Dubai: Some of the oldest private schools in Dubai — such as Our Own English High School, which is not financially viable — will face closure unless fee restructuring is permitted to meet rising costs, education provider GEMS has said.
In an ardent plea to the government authorities to lift the fee freeze, GEMS, one of the biggest private education providers in the UAE, said the Asian schools that have been operating for more than 40 years are still charging an average fee of Dh5,000 while many new schools are allowed to charge as much as Dh15,000.
"Today, we have come to a stage where it is impossible to run old schools at less than half the price of the new ones because we have been losing our quality teachers to the new schools on account of our inability to offer competitive salaries," Sunny Varkey, Chairman of GEMS, said in a letter addressed to the Knowledge and Human Development Authority (KHDA) that oversees schools in Dubai.
He added that since the fee increases permitted by KHDA have been far too little to fully absorb the increasing operating costs, they have been carrying on with the old schools by delaying certain critical maintenance capital expenditure, class size increases and high cost bank debts. KHDA recently denied permission to eight Asian schools, including GEMS-run schools, to raise fees for the academic year 2010-2011 that starts in April.
Average increase
The education authority told the schools that fee increases are not justifiable as the market has stabilised and, concurrently, rents have come down.
However, GEMS maintains that the running costs of schools are on the increase as commercial rents have not fallen, unlike residential rents. The private operator said over the last six years the average increase in operating costs has been 57 per cent, while the average increase in tuition fees has been 27 per cent.
Adding to their woes, according to Varkey, is the forced relocation of schools due to rent increases, as in the case of Dubai Modern High School. The school had to relocate from its campus in Al Safa to a newly built campus in Nad Al Sheba with a 90 per cent fee increase, leading to protests by parents.
Varkey said the building that was occupied by Dubai Modern High School before is now available for lease to new school operators who are allowed to charge appropriate fees to meet the landlord's rental demand.
He added that two more of their schools — Our Own English High School (Oud Mehta) and Cambridge International School (Al Garhoud) — are facing similar issues with its landlord, and will be forced to relocate with higher fees. These schools that charge an average of Dh5,000 for tuition annually cater to middle-income Asian parents.
"Certainly, the cost of relocating will be much higher than implementing a one-time fee adjustment to reflect the increased rent within the same location. Otherwise, in the current circumstances, a number of our schools have been driven to breaking point and we as GEMS can no longer commit to maintaining our own internal and KHDA quality standards. Consequently, it is highly likely that we will have no choice but to begin to close down unviable schools over the next two years," Varkey added.
