Delhi School Fee Regulation: Tuition, annual & development fees capped; 15% parent support needed to raise fee complaint

Delhi School Fee Regulation: The 'Delhi School Education (Transparency and Fee Regulation) Act, 2025', which has been officially notified by the Delhi Lieutenant Governor, V K Saxena, has made radical changes to the fee fixation, collection, and revision methods of more than 1,600 private schools that are recognised in the capital.

The law, which was published in the Delhi Gazette, is now in force, and it sets up an uncharted territory with respect to preventing the increase of school fees, providing financial transparency, and keeping the schools accountable.

Major impact of Zee Business campaign

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This significant move comes after Zee Business’s campaign, which made a significant impact and has resulted in the Delhi Government's decision to establish a clear and regulated school fee structure. The new framework prohibits the inclusion of any extra charges in the tuition fee and has set the amounts for caution money and registration fees, which is a move made in the direction of transparency.

Under the new regime, no private school can even increase its fees by one rupee without the prior consent of the designated Fee Regulation Committees. Any such unauthorised increase will be considered unlawful, and consequently, the school will have to refund the amount within a period of 30 days.

Fee components strictly limited

The Act defines the various fee categories, along with the maximum limits and total prohibitions on any extra or arbitrary charges.

1) Registration and one-time charges

• Registration fee: Limited to Rs 25 per student
• Admission Fee: Rs 200 per student, payable just once and not chargeable in case of readmission
• Security Deposit (Caution Money): Rs 500, to be kept in a bank and returned with interest when the student leaves. It is not to be utilised for routine school expenses.

2) Tuition Fee

Tuition fee is classified as the main academic fee covering:

• Staff salaries
• Class and curricular activities
• Resources for digital learning
• Laboratories and libraries

Tuition fee cannot cover capital expenditures like construction costs. The fee should be charged monthly and the amount should not be more than one month’s tuition fee at any time.

3) Annual charges and development fee

• Annual charges: For regular administration and maintenance, limited strictly to essential non-tuition expenditures.
• Development fee: For infrastructure improvements only, capped at 10 per cent of the annual tuition fee.
• The schools that charge the development fee are obliged to keep a 'Depreciation Reserve Fund' in a bank account separate from the school's general account.

4) Earmarked charges for optional services

• Specialised services—like transportation, optional sports, or extracurricular programmes—may be billed exclusively on a 'no profit, no loss' principle.
• Only the users of the service will receive charges.
• No additional fee can be imposed for the shared facilities, such as the library or playground.

5) Total prohibition of capitation fee

• Any type of capitation or arbitrary fee—under any name—cannot be collected.
• Charging without proper approval or justification is a serious violation.

Mandatory disclosure and transparency requirements

The law puts a significant emphasis on financial transparency:

• Schools have to submit their fee structure proposal—with audited financial statements—by July 31 each year for the three following academic years.
• Unaudited financial documents will not be accepted.
• Schools have to put the fee structure approved by the committee on their notice boards and websites.
• All documents related to fees must be made available to parents within 7 working days of the request, at a rate of Rs 1 per page (soft copies free).
• Surplus funds must either be returned or credited towards future fees.
• Funds collected by the student cannot be passed on to the managing society or trust.

Financial management: GAAP, asset registers, and accountability

The financial resources of educational institutions should not be misused; hence, schools have to:

• Maintain different accounts for every component of the fee.
• Adopt the Generally Accepted Accounting Principles (GAAP).
• Keep up a fixed asset register and account for depreciation.
• Make arrangements for retirement benefits for employees, like gratuity.
• If the schools do not maintain accurate and complete accounts, they will be liable to penalties and administrative action.

Three-Tier fee regulation system

There is now a strong multi-layered regulatory mechanism that is:

1) School-Level Fee Regulation Committee (SLFRC)

Each academic institution should form an SLFRC whose members are:

• Principal (Secretary)
• Representative of the school management (Chairperson)
• 3 teachers
• 5 parents (chosen through a visible lottery; women and disadvantaged groups have to be adequately represented)
• A designated officer from the Directorate of Education to act as an observer

It is a must to video record the lottery process, and a 7-day advance notice has to be given. A minority school must have at least one member from the minority community.

Function:

SLFRC will assess and sanction the fee proposals for each three-year cycle, review the audited accounts, raise objections, and send decisions to the District Education Office.

The position that is vacant must be filled in 15 days, or else the committee may be dissolved.

2) District-Level Appeal Committee

Parents can make an appeal against the fees that have been approved; however, this is only possible if at least 15 per cent of the parents affected (for the particular class/school) are in favour of the appeal.

3) State-Level Final Appeal and Penalty Authority

This highest authority will make the final decision and define the penalties for the offenders.

Penalties and enforcement

The new law comes with strong deterrents:

• Illegal fee hikes have to be refunded within 30 days (20 days if specifically instructed) through digital payment or cheque.
• The monetary penalties range from Rs 1 lakh to Rs 10 lakh.
• Repeated offenders will have to pay double the penalty.
• In cases of continual breaches, the committee may suggest the withdrawal of recognition.

The chairperson of the Revision committee will receive honorariums:

• Rs 10,000 for every meeting
• Rs 2,000 for conveyance
• Rs 1,500 as a monthly mobile allowance

Impact on parents and schools

The law reforms empower parents significantly, who now have:

• A structured platform for objections
• Full access to financial documents
• Representation in fee-setting mechanisms
• Assurance against arbitrary fee hikes

On the other hand, schools will need to prepare for transparent budgets backed by audits and justify every item in their tuition fee proposals.

The government will soon publish detailed guidance on the formation of committees, online complaint systems, and enforcement processes in the Educational Directorate.