Capitation fee
Encyclopedia
Capitation fee is a fee or payment of a uniform amount charged per person. In medicine, Capitation (healthcare)
is one mechanism to pay physicians, where in a fixed payment remitted at regular intervals to a medical provider by a managed care organization for an enrolled patient. In education, it is an additional fee collected to cover expenses not included in other fees such as tuition.
n law, capitation fee refers to the collection of payment by educational bodies not advertised in the prospectus of the institution, usually in exchange for admission to the institution.The Prohibition of Unfair Practices in Technical Educational Institutions, Medical Institutions and Universities Bill, 2010 defines Capitation Fee as - any amount (by whatever name called)—
behalf of any institution, or paid by any person in consideration for admitting
any person as student in such institution; and which is in excess of the fee
payable towards tuition fee and other fees and other charges declared by any
institution in its prospectus for admitting any person as student in such
institution; or
on behalf of any institution, or paid by any person in consideration for admitting
any person as a student in such institution.
In one aspect or point of view, the capitation fee comes as a surprise to the student at a time when the student may have forsaken admission deadlines at other institutions. Choosing not to pay may even lead to a form of extortion by withholding the degree. Parents often cough up money so that there is no ill bearing that affects their wards scores or standing. The fee might not be uniformly applied. The donation money is often not accounted, its usage and allocation are mismanaged and not reported to Income Tax. In such cases of malpractice, students over pay for sub-standard education.
Capitation fee are generally seen as a main revenue generator in the private private institutions may charge, contending that admissions that cater to affordable sections of society somehow affects the overall number of students educated. The government also controls the seat allocation, number and ratio of management, payment and free seats. This limits the institutions' ability to raise money through tuition, leaving institutions in need for money. Collecting donations becomes a side effect of the government laws that disallow institutions from setting their fees. Some parents do genuinely donate to improve the infrastructure of their wards' college.
, Supreme Court declared that charging of capitation fee was arbitrary, unfair and therefore in violation of the fundamental right to equality contained in article 14 of the Constitution. The Prohibition of Unfair Practices in Technical Educational Institutions, Medical Institutions and Universities Bill, 2010 recognized capitation fee as a cognizable offence. On the other hand, various private colleges have defended capitation fee on the ground that it avails institutions with funds to re-invest in the institution which can be utilized for imparting quality education. V Raghunathan, former professor, IIM-Ahmedabad said “For engineering colleges in most states, the permitted fee for unaided private colleges is in the vicinity of Rs 30,000 per student per annum. Given that even most kindergarten schools charge a higher fee in the cities, one wonders exactly how the private institutions are expected to provide high quality technical education for this fee”
Capitation (healthcare)
Capitation, is a method of paying health care service providers a set amount for each enrolled person assigned to that physician or group of physicians, whether or not that person seeks care, per period of time....
is one mechanism to pay physicians, where in a fixed payment remitted at regular intervals to a medical provider by a managed care organization for an enrolled patient. In education, it is an additional fee collected to cover expenses not included in other fees such as tuition.
Capitation Fee in India
In the context of IndiaIndia
India , officially the Republic of India , is a country in South Asia. It is the seventh-largest country by geographical area, the second-most populous country with over 1.2 billion people, and the most populous democracy in the world...
n law, capitation fee refers to the collection of payment by educational bodies not advertised in the prospectus of the institution, usually in exchange for admission to the institution.The Prohibition of Unfair Practices in Technical Educational Institutions, Medical Institutions and Universities Bill, 2010 defines Capitation Fee as - any amount (by whatever name called)—
- Demanded or charged or collected, directly or indirectly, for, or, on
behalf of any institution, or paid by any person in consideration for admitting
any person as student in such institution; and which is in excess of the fee
payable towards tuition fee and other fees and other charges declared by any
institution in its prospectus for admitting any person as student in such
institution; or
- Paid or demanded or charged or collected, by way of donationDonationA donation is a gift given by physical or legal persons, typically for charitable purposes and/or to benefit a cause. A donation may take various forms, including cash, services, new or used goods including clothing, toys, food, and vehicles...
, for, or,
on behalf of any institution, or paid by any person in consideration for admitting
any person as a student in such institution.
- A submission by counsel, F.S. Nariman, in the P.A. Inamdar case (August 2005) defines capitation fee as "something taken over and above what the institution needs by way of revenue and capital expenditure plus a reasonable surplus."). It also goes by the name donations that are not of the voluntary type. This practice is widely prevalent in private colleges and universities in India, especially those that grant baccalaureate degrees in Engineering, IT and the sciences, for which the demand for admissions exceeds the supply.
In one aspect or point of view, the capitation fee comes as a surprise to the student at a time when the student may have forsaken admission deadlines at other institutions. Choosing not to pay may even lead to a form of extortion by withholding the degree. Parents often cough up money so that there is no ill bearing that affects their wards scores or standing. The fee might not be uniformly applied. The donation money is often not accounted, its usage and allocation are mismanaged and not reported to Income Tax. In such cases of malpractice, students over pay for sub-standard education.
Capitation fee are generally seen as a main revenue generator in the private private institutions may charge, contending that admissions that cater to affordable sections of society somehow affects the overall number of students educated. The government also controls the seat allocation, number and ratio of management, payment and free seats. This limits the institutions' ability to raise money through tuition, leaving institutions in need for money. Collecting donations becomes a side effect of the government laws that disallow institutions from setting their fees. Some parents do genuinely donate to improve the infrastructure of their wards' college.
Arguments For and Against The Capitation Fee
The practice of charging capitation fees by various institutions and universities has been subjected to criticism on various grounds. It has been often referred as ‘killing of merit’. In its emphatic judgement in the Mohini Jain V/s State of Karnataka caseMohini Jain V/s State of Karnataka case
In 1989, the Government of Karnataka issued a notification that permitted the private medical colleges in the State of Karnataka to charge exorbitant tuition fees from the students admitted other than the ‘Government seat quota’. Miss Mohini Jain, a medical aspirant student filed a petition in...
, Supreme Court declared that charging of capitation fee was arbitrary, unfair and therefore in violation of the fundamental right to equality contained in article 14 of the Constitution. The Prohibition of Unfair Practices in Technical Educational Institutions, Medical Institutions and Universities Bill, 2010 recognized capitation fee as a cognizable offence. On the other hand, various private colleges have defended capitation fee on the ground that it avails institutions with funds to re-invest in the institution which can be utilized for imparting quality education. V Raghunathan, former professor, IIM-Ahmedabad said “For engineering colleges in most states, the permitted fee for unaided private colleges is in the vicinity of Rs 30,000 per student per annum. Given that even most kindergarten schools charge a higher fee in the cities, one wonders exactly how the private institutions are expected to provide high quality technical education for this fee”