Private schools charging more than allowed 8% now have to cut their fees by 20%


ISLAMABAD: The Supreme Court ordered on Thursday a 20% reduction in fees of private schools that had been increasing their fees by more than the allowed 8%. Some schools were increasing their fees by 20 to 25%, the court was told.
The court, while hearing a case regarding exorbitant fees charged by private schools, had in October ordered the institutes to furnish their respective audit reports, and formed a committee to find an amicable solution to the issue of exorbitant fees being collected from parents.
The audit reports for Lahore Grammar School (LGS) and Beaconhouse School System (BSS), which were submitted in court today, said that the directors and top officials of the schools had received Rs62 million in salaries in 2017. A total of Rs512m was spent on employees’ salaries in one year, while Rs5.2 billion was spent in five years, the report said, adding that various facilities were also provided.
The chief justice, commenting on the large amounts, wondered, “Have these schools bought uranium mines or gold mines?”
“Each director gets a salary of Rs8.3m,” Justice Nisar said. He observed that the LGS audit report appeared to be incorrect, and expressed his displeasure with the auditor, saying they should be caught and handed over to the Federal Board of Revenue (FBR). “Children are not getting relief of even Rs2,” the judge said. “The FBR should investigate.”
The court ordered the FIA to freeze the accounts of LGS and BSS, and summoned the chairmen of FBR and FIA immediately. “They’ve opened schools in rented bungalows and earn huge amounts off each room,” the chief justice observed.
The court was told by Ayesha Hamid, a lawyer for the schools, that all were ready to reduce their fees by 8 per cent, to which the top judge responded that the decrease was much too small.
Justice Ijazul Ahsan noted that the schools had provided incorrect figures in their audit reports. “Look at how directors are receiving Rs8.3m in salaries,” he said.
BSS counsel Shahid Hamid argued that Beaconhouse had paid Rs764m in taxes.
“You may have paid a lot of taxes, but the students are not getting any benefit from them,” Justice Ahsan responded. “They will only be benefited when the fees are lowered.”
“If childrens’ education is being affected, then the court will play the role of a parent,” Justice Nisar asserted.
The court subsequently ordered a 20pc reduction in the fees of all private schools, and directed them to return the fees they had charged for summer vacations.
Additionally, the court passed the order that private schools can only increase their fees by 5pc each year, and ruled that no private school would be shut.
The court directed the FBR chairman to scrutinize the tax records of all schools and to seize the details of their accounts, their ledger books and electronic records for this purpose.


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