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Sun 5 Jul 2020 11:19 AM

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GEMS CEO says parents received up to a third off tuition fees

Exclusive: Dino Varkey said decision to means-test discounts avoided negatively impacting quality of education provided

GEMS CEO says parents received up to a third off tuition fees

GEMS CEO Dino Varkey has revealed that 90 percent of parents were able to pay the fees for the third term, and the means-tested relief package benefited over 30,000 students and families.

Dino Varkey, the group chief executive officer of under-fire GEMS Education has claimed that parents received discounts on their school fees of up to 33 percent for the last term.

Varkey also said that, with teacher salaries, rents and other essential costs accounting for 90 to 95 percent of the total fixed cost of operating a school, the call for reduced tuition fees could only lead to a “difficult trade-off” and impact the quality of education.

In an exclusive interview with Arabian Business, he said: “Independent of the discount, the level of support we provided is more significant than the rest of [the operators] in the sector combined, and we are proud of that.”

The education giant, which owns and operates nearly 50 schools with over 124,000 students in the UAE, has come in for strong criticism since the switch to online learning.

The Covid-19 pandemic has had a devastating impact on the global economy and the UAE has not escaped, with many losing their jobs, being forced to take salary cuts or unpaid leave during the crisis.

Over 15,000 parents signed an online petition calling for the world's largest operator of kindergarten-to-grade-12 schools to ease the financial burden and follow the example of other operators across the region by providing a 30 percent discount across the board for the third term.

In April, GEMS said it would offer parents a reduction in fees, but only after they handed over details of their financial situation.

Fair system

Varkey has revealed that 90 percent of parents were able to pay the fees, and the means-tested relief package had benefited over 30,000 students and families.

“I am happy to say that by adopting this fair system we have been able to provide an average of 33 percent discount on tuition fees for the last term for eligible parents,” he said.

For GEMS parents who did not pay the third term fees, for whatever reason, they were threatened with pulling the plug on their child’s online education, as well as a host of other measures including withholding the final report card, not promoting students with a risk of repeating the years, and refusing to issue a transfer certificate for any new school admission.

Varkey said: “When we see that over 90 percent of the parents have paid fees, we believe the decision we took was the right one. Parents have seen the value and there is a small minority of parents who have chosen not to pay, which, however, has an impact on us.

“Several of these parents have not paid fees for two terms starting from January and we thought it was unfair on parents who have paid full fees or at discounted rates.”

He added that the decision to cut online education was done after they had “exhausted all means to reach an amicable settlement”, and was executed in conjunction with regulators.

As previously reported, some parents characterised the distance learning programme as “unorganised and inadequate”.

Satisfaction levels

However, Varkey revealed the group has invested over AED1.8 billion in technology platforms and systems over the last two decades and defended the quality of lessons delivered over the last three months.

“We have already delivered 30 million remote learning sessions, with satisfaction levels of our parents and students at over 95 percent,” he said. “Attendance in the remote learning session is in the nineties which at times is higher than daily attendance compared to our brick and mortar schools when running normally.”

With the onset of the summer holidays, the thoughts of school operators across the country are now very much focused on September, when it has been announced that – in line with health regulations at the time – physical schools will reopen for students.

There are currently 209 schools operating in Dubai with a further four set to open for the start of the new term.

Consolidations, mergers and closures

Varkey admitted he is expecting a decline in student numbers for the next academic year as the industry comes to terms with expats impacted by the Covid-19 economic crisis leaving the UAE.

He said: “It is important to know that in the history of the UAE even during the global financial crisis there has never been a time when enrolments have declined. In the current scenario, there are estimates that the reduction may be in double digit percentages and we have to plan for that.

“In these scenarios if you don’t have the strength of a network of schools, if you don’t have the deep experience of many decades, as we have, then it will be more difficult for individual schools to continue to operate. 

“In Dubai specifically, pre Covid-19, the sector was continuously growing but now the demand and supply gap is becoming more acute. I see consolidations and mergers of schools and in some cases inevitable closures.”

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