Private schools stare at financial crisis

Managements seek to clear misconceptions among public on fee payment

June 16, 2020 11:54 pm | Updated 11:54 pm IST - HYDERABAD

A financial crisis is brewing in the private schools sector with several of them struggling to keep afloat and meet the regular expenditure for running because of a steep fall in their income as a result of lockdown.

Telangana was one of the first States to impose lockdown to curb the spread of coronavirus. In April, Chief Minister K. Chandrasekhar Rao instructed private school managements not to resort to mandatory nominal fee hike this academic year and collect only monthly fees instead of annual fees at one go.

All the schools empathetic to the extraordinary situation complied with the advisory. But now three months later, with lockdown guidelines liberalised and several sectors opening up, the struggle, however, continues for many private schools with mounting fee payment defaults. Representatives of private schools told The Hindu that even while contending with fall in fee collection, they adapted to the online mode from April to prevent disruption of academic year.

The Union HRD Ministry instructed that school staff be allowed to work from home and the lockdown should not disrupt education of students.

While parents are happy with online classes, some of them withheld payment of even monthly fee.

“We coped with the situation for three months by meeting fixed expenditure towards rentals, maintenance, and electricity charges, paying salaries of staff and EMIs on loans. Our institutions may end up as non-performing assets as we can’t repay loans if we don’t get our dues,” said some managements.

“From where will the private schools mobilise resources and how long can they sustain with huge deficit revenue and still pay EMIs for buses and infrastructure?” Usha Reddy, chairperson of Hyderbad Sahodaya Schools Complex, asked.

Very few private schools have their own premises and many function from leased land in the city.

Government sources admitted that they asked school managements to collect monthly fees till the situation improved and not to increase school fees this academic year. But it was not fair on the part of people to withhold even monthly fee payments.

“ It is as much the responsibility of parents as of schools to support each other,” they said.

Sunita Rani, Director, Foster Billabong High, said some schools could not collect even 10% of their normal fee.

Members of International Schools Association, Unaided Schools Forum, Association of International Schools, and School Principals Association issued a joint appeal in public interest to “Respect teachers and Support Your School”. The managements put in public domain the fixed expenditure they incur regularly like loan repayment and , maintenance.

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