By Jai Decosta, CEO, K12 Techno Services Pvt. Ltd.
The year 2020 was not easy and as expected, the effects of it can be seen through 2021 too. Everyone in the world was directly or indirectly affected by Covid-19. None of the previous pandemics affected the global population in the way Covid-19 has done. Even if people escaped the physical effects of the virus, they were mentally affected by the isolation, joblessness or loss in business.
One of the industries affected was the private school industry because there was a vast amount of disparities in the system. A lot of private schools were shut down because they were unable to afford the technology to move their teaching to the virtual space. However, schools, such as Orchids – The International School, were able to make this switch from physical classes to online classes, faced a challenge with collecting fees from the parents. Technological changes don’t happen in a vacuum, and by not paying fees simply because the child was studying from home, adversely impacted the financial situation of the schools. This additional burden along with the regular expenditure to run a school, pay bills, repay loans and give salaries has massively added to the financial burden.
With the budget just around the corner, here are the top expectations that the government could accommodate:
- Exclusion of GST – One of the big challenges for private school players is the inclusion of GST. Reforms in terms of GST credit inputs on infrastructure developments will help in facilitating quality education by the diversion of funds.
- Loans for Private Schools – Private schools have very little scope to avail loans and unfortunately even where loans are available, the interest rates are over 16% and vary between lenders. Loans are necessary to constantly upgrade the infrastructure, and even maintain them in some cases. Very few schools are able to avail loans since the management has to provide proof of steady cash flow for the future. Considering the pandemic, and the uncertainty over fee collection, subsidies, or support from the government will be greatly beneficial.
- Digital Infrastructure – The pandemic has brought out the digital divide existing in the country. Education is no longer restricted to books and pens. It has moved beyond the classroom too. Technology once aided teaching and learning, but it is now solely the source of education. Thus it is important for the government to provide and grant schools financial aid to develop this infrastructure. The dream of a Digital India also needs to be extended to the education sector.
The year 2020 saw a drastic drop in the fee collection and new admissions. These coupled with upgrading schools to support classes digitally and retain staff, have created a huge financial burden on the schools. The reality is harsher where schools succumbed to the pressures of distress and shut down, causing unemployment and an abrupt break in the teaching-learning process. The government therefore needs to look at ensuring the education sector is supported and aided in order to secure the lives of millions of children.
Jai Decosta, Chief Executive Officer, K12 Techno Services Pvt. Ltd.
Jai Decosta is the founder and CEO of K12 Techno Services Pvt. Ltd. He has been instrumental in building the company ground up to its current position as India’s leading education service provider since 2010. With his vision to take Indian Education System to a different horizon, he is looking forward to giving a special touch of “Experience Learning” to the ed-tech sector. He plays a key role in the Profit & Loss management, investor relations and future growth areas of the company. A Chartered Accountant and an alumnus of IIM, Bangalore with experience of over two decades, Jai has been associated with several organisations in the past such as the Tata Group, ITC, the Times Group and more across multiple leadership roles. He brings Change Leadership to the board and inspires young and dynamic minds.