‘Conscious’ decision to separate funding from regulator: government officials on higher education reform

The Union government’s decision to take away funding powers from the regulatory authority and create separate regulatory, accreditation, and standards councils for higher education institutions under the proposed Viksit Bharat Shiksha Adhishthan Bill, 2025, was a ‘conscious‘ move in keeping with the National Education Policy 2020 suggestion to minimise conflicts of interest, senior government officials said on Tuesday (December 16, 2025).

They said that this is why the Bill has segregated the three roles of regulation, accreditation, and standards-setting. However, the officials said that the grant-disbursal function currently being exercised by the University Grants Commission is proposed to be performed by the Ministry of Education.

Without providing details, Education Ministry officials said that under the proposed law, the mechanism that will be used to disburse grants to Central Universities “will be similar to or better than the existing mechanisms”. They added that institutional performance on regulatory compliance will continue to be a “major factor” in deciding the quantum of funds to be distributed, but not the only one, citing the need for a “holistic view” while giving grants.

The VBSA Bill, introduced in the Lok Sabha on Monday amid objections from the Opposition, proposes an overhaul of India’s higher education regulatory framework, replacing the UGC, the All India Council for Technical Education, and the National Council for Teacher Education, with a single apex commission - the VBSA, which will coordinate between a regulatory, an accreditation, and a standards councils, operating “autonomously”. Most notably, it takes away grant-disbursal power from the regulatory authority, a power that UGC exercises in the current system.

A coalition of teachers’ and students’ associations and unions from across the country have raised objections, among others, about the proposition to take away funding power from the regulatory authority, noting that leaving it in the direct control of the Education Ministry would risk grants being subject to “political influence”.

Education Ministry officials explained that even though the NEP 2020 had suggested a separate Council for disbursing grants that the UGC currently disburses to Central Universities, “it was a conscious decision that this is not going to be possible” because of the multiplicity of “sources and funnels” through which higher education institutes across the country receive funding.

As soon as the government introduced the Bill in the Lok Sabha on Monday, it proposed that the Bill be sent for deliberation to a 31-member joint committee of Parliament, to be constituted by the Speaker.

Officials said on Tuesday (December 16, 2025) that the government hopes to engage in an intense discussion over the Bill’s provisions and is encouraging suggestions to be submitted to the panel. Officials said the government hopes to receive the panel’s report in time to bring the Bill before Parliament for passage by the end of the next Budget session.

On the Opposition’s concerns that this Bill will rob State Government higher education institutions of their autonomy, one senior official said this “policy reform” has made place for State representatives in the composition of the regulatory, accreditation, and standards councils, further noting that the autonomy institutes have in curriculum, syllabus, etc., currently will not be affected.

Explaining the provisions of the VBSA Bill, 2025, the official added that under the current system, regulatory, accreditation, and standards-setting are performed by multiple authorities and bodies like the UGC, All India Council for Technical Education, and National Council for Teacher Education. “In many cases, these bodies exercise all three functions of regulation, accreditation, and standards-setting, leading to conflicts of interest, duplicity of regulatory requirements, and overlapping functions,” the official said, stressing the need to bring them together.

A second official explained that through this proposed law, the government hopes to standardise rules and regulations, including how higher education institutions are categorised. “The current nomenclature of institutions, like deemed university, causes a lot of confusion,” the officials said, adding, “The institutions as they exist today will remain, but what we call them might change.”

The first official said, “Disciplines like AI are something we could not have thought of a decade ago. There are also so many multi-disciplinary courses being started now to equip the country’s start-up ecosystem; these need standards-setting. There is a need to account for the rise in skilling and upskilling. Today’s need is change.” The official added that this Bill also grants powers to impose “real penalties” for non-compliance with regulations, unlike the current system, where UGC can levy fines of up to ₹1,000, and “there were often reports of mushrooming fake universities”.

The Bill has fine ranges from ₹10 lakh to ₹2 crore and above for various violations, including repeated violations. The highest fines are set for institutes operating without the required accreditation. The officials added that this Bill also aims to keep the system and data on regulatory compliance “open to public scrutiny” and ensure “public accessibility”.