investment in higher education: new directions finance ict... · prof. chacha nyaigotti-chacha and...
TRANSCRIPT
Prof. Chacha Nyaigotti-Chacha and Dr. Cosam C. Joseph
Inter-University Council for East Africa
Investment in Higher Education:
New Directions
Presentation made at the SARUA Leadership Forum, University of
Dar es Salaam, Tanzania, 5th August 2010
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Outline
Global Trends on Higher Education
Chronological Landscape Higher Education in
Sub-Saharan Africa
Dynamics of Policies on Funding of Higher
Education in Africa
A university in the Current Context
Challenges of Universities
Why Invest in Higher Education?
Who should pay?
Models of Payment: Global Lessons
Innovative fund raising
Opportunities for African Universities
Conclusion
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Global Trends
Financing HE
Human Capital
Theory
• Shift part of burden of HE costs from
governments to students, families and other
stakeholders
• Investing in education had both private and
social rates of returns.
• More educated society may translate into
higher rates of innovation, higher overall
productivity and assimilation of new
technologies.
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Global Trends (Contd…)
Shift from Elitist
to Universal
access to HE
Elite Mass Universal(EFA)
< 15% 15-50% > 50%
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Chronological landscape of HE in Sub-Saharan Africa1. Colonial/Pre-Independence Era
-Colleges affiliated to Colonial power universities
-Emphasis on agriculture and teaching
2. Post-Independence
-Expansion of HE with support from former rulers and
donors
-Agenda was on nationalism & National development
3.1990s-todate
-Revitalization of HE in SSA
-Globalization
-Internationalization
-Private Higher Education
-Demand for Quality Assurance from Stakeholders
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Policy dynamics on Funding HE for
AfricaThe World Bank and other international financial
institutions
1980-1990s
Education is an economically and socially productive
investment…The current financing arrangement…
result in the misallocation of public spending on
education…There is evidence, deriving from the effect
of schooling on earnings and productivity, that in
countries the average dollar invested in primary
education returns twice as much as the one invested in
HE. Yet governments in these countries heavily
subsidize HE at the expense of primary education.
(World Bank 1986)
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Policy dynamics (Cont'd)..........
World Bank: 2000s
“In fact, it is doubtful that any developing country could not make
any significant progress towards achieving the United Nations
Millennium Development Goals foe Education-universal enrolment
in primary education and elimination of gender disparities in
primary and secondary education-without a strong tertiary
education system”.
“Because skills for the knowledge economy are built at the tertiary
education level, improving tertiary education systems should be
high on SSA’s development agenda. And African tertiary
education institutions and policy makers must ensure that the
workforce acquires the skills to compete, innovate, and respond to
complex social, environmental, and economical situations”.
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Impacts of HE Policies of the 1990s
Decline of HE institutions in Africa
-Enrollment
-Infrastructure
-Research
-Brain drain
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Challenges to Governments and HE Institutions
Governments
Institutions
• Reform HE in response to twin pressures of
rising private demand and heavily
constrained public budget constraints.
• Ensure that increasingly autonomous
institutions respond to public interest
agendas while taking great responsibility of
their financial sustainability
• Manage an increasingly complex portfolio
of aims and funding to satisfy stakeholders
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A University: The current context
The University is no longer a quite place
to teach and do scholarly work at a
measured pace and contemplate the
universe as in the centuries past.
It is a big, complex, demanding,
competitive business requiring large
scale ongoing investment.
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Multitude Stakeholders and Requirements....
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Some challenges to universities
Accountability: Public agendas have become more
complex and demanding and institutions need to
respond to a broader range of stakeholders .
Rapid growth and complexity of volume of HE activities
( teaching, research and outreach services)
Core funding from governments has not kept pace with
this growth
Investment in institutional infrastructure has fallen
below the levels needed for sustainability
Increased market pressures and in a more competitive
environment.
Why invest in Higher
Education/University?
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Purpose“I do believe that it is necessary to stress
that most countries today, human resource
development and human capital formation
are either extremely important, absolute
vital, or a matter of life and death. In the
case of Malaysia … we think it is a matter
of life or death”
Abdullar Bin Ahmed Badawi, Prime Minister of Malaysia
(Opening Speech of the 2006 Meeting of the Association
of Commonwealth Universities)
Conceptual Links from HE to Economic Growth
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University Funding Modelling System: Impact
Based
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University Funding Model
Economy Wide Impacts
University Research and Productivity Model
Educational Attainment and Productivity Model
Research Funding
Productivity byIndustry
Overall LabourProductivity
Governmentexpenditure, exports andlabour force size changes
Graduating domesticestudents and international students who obtain permanent visas
The system of University Models
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MUST
MUST
Account for Economic implications of
expanding the university sector
MUST, TO RECEIVE A GRANT
(a) Higher government funding
(b) Changes in the size of labour force
(c) Gains in productivity from having a more highly educated workforce,
and
(d) Gains in productivity from additional research funding
Including
Value on Investment (VOI) perspective and
Institutional Financial Sustainability
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1. Shape the development of enterprise technology and
human resources, infrastructure, focusing on the need for
commitment to transformative change, not just greater
productivity (Culture of Change).
2. Can be an essential element in resourcing the institution’s
business process portfolio and creating innovative
solutions.
3. Can inspire and guide the efforts of institutions to craft
strategic responses to the mixture of challenges and
opportunities that currently confront HE.
Example: ICT can be conceived as a strategic integrator
and enabler of collaboration and innovation, yielding
strategic differentiation and prosperity.
Government Funding Model: Global
Lessons: Performance Based
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Output-oriented Research Funding
Input-oriented Research Funding
Input-oriented Teaching Funding
Output-oriented Teaching Funding
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Economic Thinking
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Optimal Financing of HE: Global Lessons
Economic
Thinking
(i) Public financing through
-grants to HE institutions
- income related grants
-guarantees for students Loans
(ii) Private financing through
-tuition fees
-repayment through Student Loans
-Contribution through business
-Contributions through endowments
(iii) Philathropists/international organizations
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Typology of Allocation Mechanisms: Global
Lessons
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Typology (Contd….)
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Typology (Contd….)
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Typology (Contd….)
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Typology (Contd….)
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Typology (Contd….)
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Typology (Contd….)
Some Innovations on institutional fund
raising
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Endowment Fund
An investment fund set up by an institution in which regular
withdrawals from the invested capital are used for on-going
operations or other specified operations or other specified
purposes.oluntary contributions from alumni, employers and other
benefactors.
Voluntary contributions from
-alumni,
-employers and
-other benefactors.
Internationalization Dimension
Student Exchange
-Ocassional
-Fulltime
Research
Consultancy Services & Contractual research
Business ventures (Public-Private-Partnership)
Opportunities for African universities
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Exploitation of Regional initiatives
There is utmost need for realization of concerted efforts of inter-governmental bodies such as AU, NEPAD and AU and universities such as SARUA, AAU
World Bank support in Tertiary Education (Accelerating Catch-up)
Optimize the current WB initiative as a breakthrough to the new era
International Partnership in HE
Exploit existing opportunities from donor organizations, foundations/philanthropists
Diaspora contribution Need for networking and linkage with Africans in the diaspora for expertise and resources mobilization (The case of India $ China)
CONCLUSIONS
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Remember, if you cant invest in your institution
adequately and rationally,
You can’t measure the Quality of your academic business!
If you cannot measure it, you cannot control it.
If you cannot control it, you cannot improve it.
If you cannot improve it, you cannot compete.
If you cannot compete, you cease to exist.
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Thank you very much for your
attention
Ahsanteni sana