University governance in Finland: recent developments and challenges

Anita Lehikoinen, director of the Education and Science Policy Department, Ministry of Education, Finland29 October, 2010

Communications and Public Relations

Minister of Culture and Sport State Secretary

Minister of Education and ScienceState Secretary

International Relations

Department for Education and Science policy

• Department Office

• General Education Division

• Vocational Education Division

• Division for Higher Education and Science Higher Education Research

Department for Cultural, Sport and Youth policy

• Division for Cultural Legislation and Finance

• Division for Art Policy Cultural Export and Exchange Unit

• Division for Cultural Policy Copyright Unit

• Sports Division

• Youth Policy Division

Administration Department

• General Administration Division

• Human Resources Division

• Financial Planning Division

• Financial Administration Division

• Information Management Division

May 2010

Internal Audit Permanent Secretary

Themes of the Presentation

• Higher Education system in Finland• Structural Development of Higher Education• University Reform• Steering and Funding of Higher Education

Institutions• Science Policy

The Finnish Higher Education System

• The Finnish higher education system comprises two parallel sectors:– University sector

• 16 research universities, including 4 Universities of Arts• Student enrollment 140 500• All institutions run by the state

– Polytechnic sector (established in the mid-1990s)• 25 institutions• Student enrollment 113 400 • Institutions partly funded by the state, partly by municipalities• Regional development tasks• Bachelor degrees (vocational and professional degrees)• (Professional) Master’s degrees in selected fields

• The whole HE system provides study places for 65-70% of an age group

• Annual intake of students approximately 56 000 • Annual number of senior high school graduates 33 000

Key Features of the Finnish Higher Education System

• "Open and equal access" for all

• An extensive network of HE institutions covering the whole country– Regional equality

• Tuition free system– HEIs can, however, arrange made-to-order degree education to

citizens of non-EU/EEA countries– In addition, there will be a fixed-term trial of charging tuition fees

to citizens of non-EU/EEA countries in master's programmes taught in foreign languages in universities and polytechnics

• Provisions concerning university degree programmes will be enacted by a Ministry of Education Decree.

• Tuition fees are conditional on a scholarship scheme.

HEIs and Sectoral Research Institutes

Universities (blue) Polytechnics (green)Sectoral research institutes (red)

Cohorts entering (upper) secondary education and the first cycle of tertiary

education in 2007 - 2025

52000

54000

56000

58000

60000

62000

64000

66000

68000

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025

Cohort, 19-21years Cohort, 16-18 years

Themes of the Presentation

• Higher Education System in Finland• Structural Development of Higher

Education• University Reform• Steering and Funding of Higher Education

Institutions• Science Policy

Structural Development of Higher Education

• Government Programme stresses the importance to continue structural development of HEIs– To enhance the HE network in order to create more prominent

institutions with higher standards– To ensure the quality and effectiveness of HEIs' research and teaching– To allocate resources to top-level research and strategic priority areas

• The reform forms part of the European higher education reform– Communication of the European Commission "Delivering on the

Modernisation Agenda for Universities: Education, Research, Innovation" of May 2006

• Development targets for higher education recommended in the thematic OECD review– Internationalisation, clearer institutional missions and positions, and

diversification of the funding structure

Aims and measures

• In terms of full-time students, the target size for a university is 3,000, for a polytechnic 2,500 and for a strategic alliance 8,000.

• The target intake in a degree programme is 40 at the minimum. – Important special fields will adopt a system of admission in alternate years

• The department structure will be reformed with the aim of departments/units of at least five professors.

– In addition, universities and research institutes to create joint departments

• The number of higher education institutions will fall.• The new higher education institutions to be larger and

stronger.• Sufficient size of higher education institutions to boost cross-

disciplinary education and research, generate new innovations and improve student services.

• Close cooperation and partnerships will bring added value to education and research and open new opportunities for students.

Aims and measures

• Measures are taken to make sure that the higher education system covers the whole country.

• With a view to better quality of education and research, activities will be assembled into the main campuses.

• High quality of operations will strengthen the impact of higher education institutions on society and on regions.

• Only strong HEI units are attractive as cooperation partners to other higher education institutions and players in the innovation system.

Steps to this end• The HEIs to determinate their strategies, profiles and

priority areas in their renewed strategies by 2010– Clearer profiles and clearer institutional missions

– between higher education institutions – between universities and polytechnics– within universities and polytechnics

Vision 2020

• Maximum of 18 polytechnics– Intake in youth education of 22,500 students (in 2009 ~26 500)– Flexible and profiled higher education units and structures– Strong and dynamic interaction with the region and its employers– Well-established, high-quality R&D in priority areas

• Maximum of 15 universities– Intake of 17 500 students (in 2009 ~19 500)– Strong units and profiles; clear priorities in research– Internationalisation and world-class research

• Four to five strategic university-polytechnic alliances– Secured access to education and diverse education provision in the

area– Joint R&D and stronger (regional) impact

Themes of the Presentation

• Higher Education system in Finland• Structural Development of Higher

Education• University Reform• Steering and Funding of Higher Education

Institutions• Science Policy

The New Universities Act (558/2009)• The Universities Act includes

– provisions on the mission, – administration, – operational funding and steering of universities, – and matters relating to research and education, – students and – personnel.

• The reform took effect on 1 August 2009.– The public universities started to set up the new organs of the legal

person.

• The operations of universities as state accounting offices stopped on 31 December 2009.

• The personnel and students transferred to the new universities on 1 January 2010.

Means of the university reform in a nutshell Status as legal persons• 1.1.2010 universities became legal persons separate from

the State, either as corporations under public law or foundations under the Foundations Act.

• Corporation under public law (public university)– A legal person under the Universities Act whose organs and their

functions are laid down in legislation.

• Foundation under private law (foundation university)– A legal person under the Foundations Act which is assigned the

university mission in the Universities Act.

• The government will continue to be responsible for funding the public duties of the universities even though the universities are no longer within the State budget economy.

• The Ministry of Education will ensure by means of steering that university activities conform to the higher education policy aims set by Parliament and the Government.

Aims of the university reform in a nutshellAims of the university reform• Universities used to be organised as State accounting

offices• To give the universities a stronger financial and

administrative status, they were made independent legal persons and supplied with sufficient capital.

• As legal persons, the universities will be better able to operate with the surrounding society.– Having their own capital, the universities will have more scope for

operating based on their own decisions.

• Efforts will be made to gain the commitment of other actors in society to support the universities' mission.

• Measures will be taken to ensure continued international competitiveness of the university system.

The Universities Act will change...• Autonomy will strengthen: universities will have an independent legal status• Universities will take the place of the State as employers: civil-

service employment relationships will become contractual employment relationships

• Community relations will strengthen: – At least 40% of the members of the board of a public university

(incl. the chairman) must be external to the university community • The "external" members are elected by the university collegiate

body, which may also decide to have an external majority on the board, if it so wishes.

– The board of a foundation university has 7 members, three of whom are nominated by the founding members of the university foundation

• The board is appointed by the multi-member administrative body of the university.

• Greater latitude with finances: donations, income from capital and business activities

• New universities: Aalto university (HUT, HSE, UIAH), University of Eastern Finland (universities of Kuopio & Joensuu) and the new Turku University (University of Turku, Turku School of Economics)

• Performance agreement procedure between MoE and universities will be lighter

• Charging of tuition fees on a trial basis for separate Master’s programmes from students from outside the EU/EEA

The Universities Act won't change...

• The freedom of research, art and education • Self-government and academic decision-making• Research and higher education remain as the main tasks of

the universities• The State will guarantee core funding, taking into account

the development of costs• Education leading to a degree will continue to be free of

charge

Further informationwww.minedu.fi > Education > Education Policy > University reform

Themes of the Presentation

• Higher Education System in Finland• Structural Development of Higher

Education• University Reform• Steering and Funding of Higher Education

Institutions• Science Policy

Steering and funding of HEIs• State funding for HEIs

Universities € 1,7 bnPolytechnics € 0,9 bn+ Public research funding (Academy of Finland &

Tekes) € 0,3 bn

• External funding for universities

1 000 euro

% of the external funding

% of the total university

budget

Academy of Finland 174 748 21,2 7,2Finnish Funding Agency for Technology and Innovation, Tekes 105 635 12,8 4,4Finnish enterprises 104 709 12,7 4,3Other Finnish sources 316 990 38,4 13,1EU funding 93 604 11,3 3,9Foreign enterprises 14 093 1,7 0,6Other international sources 14 987 1,8 0,6Total 824 766 100 34,2

(2009, expenses)

Allocation framework

• Legal basis of the university funding– Universites Act (558/2009) 49 § sets the framework– MoE Decree (771/2009) elaborates details

• Legal basis of the polytechnics funding– Part of the Government subsidy system - linked to municipality

funding – Decree on the Financing of the Provision of Education and Culture

(806/1998 + amendments)

• Public research funding to be allocated through competition

Performance Agreements Between MoE and HEIs 2010-2012

Structure of the agreement: 1. Aims Common to Higher Education System

– Verbal goals incl. statutory university/polytechnic missions, internationalization, student & HR issues as well as cost-efficiency and effectivness of operations

– Societal impact a priority in all universities' operational targets

2. Mission, Profile and Focus Areas of the HEI– To reflect university's overall strategic plan as well as national HE and science policy

goals– To set appropriate strategic targets = to condense a message of the strategy into

the essential – To set university / field specific quantitative goals (7)– Indicators (13)

3. Foremost Development Targets – 1-5 projects per university linked to the implementation of the HEI's strategy

4. Financing– The government funding in total

5. Monitoring and Evaluation

Quantitative targets for universities 2010-2012UNIVERSITIES Actual

number 2007

Actual number

2008

Target 2007-2009

University

Offer 2/09

2010-2012

Target

2010-2012

Bachelor degrees 5 879 13 876 10 170

13 904 13 815

Master degrees 13 884 21 825 14 518

15 244 14 893

PhDs 1 526 1 526 1 594 1 755 1 624

Number of pupils at the schools for practice of teachers

7 848 7 833 7 900 8 026 7 920

ECTS completed under teacher training guidance at the schools for practice

41 352 38 273 42 318

34 8901) 42 020

Foreign degree students 5 897 7 921 8 245 8 950

Exchange students (incoming & outgoing, > 3 months)

9 254 9 799 11 325

11 615 11 200

Quantitative targets for polytechnics 2010-2012

POLYTECHNICS Actual numbers

2007

Actual numbers

2008

Polytech.

Offer2010-2012

Target set (MoE)

2010-2012

Polytechnic degrees 20 276 20 951 22 588 21 650

Vocational teacher education

1 397

1 519 1 544 1 530

Polytechnic Masters 362 681 1 798 1 808

Foreign degree students 5 299 6 294 7 412 8 500

Exchange students (incoming & outgoing, > 3 months)

7 182 7 473 8 705 8 800

Performance indicators 1(2)

Education• Students (FTE) / teaching and research personnel• Masters' degrees/ teaching and research personnel• Doctoral degrees/ professors• Percentage of graduation after seven years studies• Percentage of students who have passed more than 45

study credits• Percentage of graduates compared to drop-out

Performance indicators 2(2)

Research• International publications / teaching and research personnel• Scientific publications (not including int. publ.)/ teaching and

research personnel• Percentage of national competive funding from the university

total funding• Percentage of international research funding from the

university total funding

Internationality• Staff international mobility / teaching and research personnel

Societal interaction/impact• Percentage of complementory funding from the university

total funding • Percentage of employed from graduates

Core funding for universities from 2010

Government funding EUR 1.7 billion

Education 55%

Other education and science

policy considerations

25%

Exten

t of activities

85%

Qu

ality

an

d

effe

ctiv

en

es

s1

5%

Formula-based core funding based on the quality, extent and impact 75%

Exten

t of activities

75%

Qu

ality

an

d e

ffec

tive

ne

ss

25%Research and researcher

education 45%

Ed

ucatio

n an

d

discip

line stru

cture

75%

Strateg

icd

evelop

men

t 25%

Core funding for universities – Education

Quantity of operations

85%

Quality and efficacy

15%

Calcu

lated

nu

mb

er of

stud

ents

30%

Targ

et nu

mb

er of

Bach

elor an

d

Master's d

egrees set

in th

e Mo

E-

Un

iversity ag

reemen

t35%

Nu

mb

er of

Bach

elor an

d

Master's d

egrees

award

ed b

y tthe

un

iversity 35%

Quality of education and efficiency of study processes (80%)-The Centres of Excellence in education (300 000 euro annually / centre)-Percentage(%) of degree students who complete at least of 45 ECTS in a year- % of degree students graduating (Master's) within 7 years of enrolmentInternationalisation (20%)-Student mobility from and to Finland (>3 months in duration)- Nr of credits completed in foreign language instruction&earned abroad - Nr of international degree students

Education

Core funding for universities - Researcher training and research

Extent of activities75%

Quality and impact

25%

Teach

ing

and

research

perso

n-

years50%

Targ

et nu

mb

er of

Ph

D d

egrees set in

th

e Mo

E-u

niversity

agreem

ent

25%

Nu

mb

er of P

hD

d

egrees

25%

Nationally competed research funding (60%)- Academy of Finland funding- AoF funding for Research Centres of Excellence- Tekes fundingScientific publications (20%)- Number of refereed international publication- Number of other scientific publicationsInternationalization (20%)- Internationally competed research funding- Extent of teacher and researcher mobility (incoming+outgoing, min. 2 wks)

Research and researcher education

Core funding for universities – Other education and science policy considerations

Education and discipline structure 75%

Strategicdevelopment 25%

- Disciplinary structure- Special national duties- Teacher training schools- Graduate schools- National Library of Finland

Strategy of the university-national education and science policy aims- concrete development goals, measures for attaining them, and means of monitoring implementation of the strategy-2010-2012 key development targets are internationalisation and development of researcher career path

Other education and science policy considerations

Funding formula of polytechnicsState funding comprises approximately 60% of polytechnic funding. Additional 40% is allocated by municipalities to the polytechnic's operations.

Discretionary government

grant

22 M€ in 2009

70 % (594 M€)• Calculated number of students by polytechnic’s different fields of education • Based on the number of study places and number of students set in the MoE-polytechnic agreement

Government core funding

(A unit price per student* x Number of students)

849 M€ in 2009

30 % (255 M€)• Number of degrees awarded by the polytechnic• Average of past two years

Project funding 19 M€

Performance based funding 3 M€

Discretionary increase in unit price

*) unit prices are calculated every four years on the basis of actual costs

Polytechnics: Unit prices by field of education

Calculated number of

students

Average price of field of education

Average price of field of study

Field of education youth adults total in 2009 in 2008

 

1 Humanities and education 1 039,5 204,7 1 244,2

10 670,56

10 264,27

2 Culture 8 412,01

381,2 9 793,210

870,4210

456,63

3 Social sciences, business and administration

17 017,0

4 389,8

21 406,8 6 066,07 5 832,62

4 Natural sciences 4 900,0 978,1 5 878,1 6 150,45 5 913,83

5 Technology, communication and transport

31 644,0

4 859,0

36 503,0 6 911,88 6 646,68

6 Natural resources and the environment 3 104,0 687,9 3 791,9 8 407,78 8 086,43

7 Social services, health and sport

20 555,5

5 815,4

26 370,9 7 714,53 7 419,20

8 Tourism, catering and domestic services 5 435,5

1 224,0 6 659,5 6 876,75 6 612,87

Monitoring• From 2010 universities close the books according to the accounting

legislation– financial statement is a public document

• The HEIs must provide the information requested by the Ministry for the purpose of evaluation, development, statistics and other information needed for monitoring and steering insofar as this information is not otherwise available.

• The HEIs have to present correct information on their performance and finances in a way that enables their progress be evaluated against the set goals. – Development is annually monitored through indicators which

gauge effectiveness and quality – The universities must manage their finances efficiently and use

their resources to good effect • The Ministry of Education gives feedback to the HEIs on their activities

and development needs during the agreement period. As a rule, more comprehensive feedback is given during the intervening years between negotiations. – The feedback procedure is used to steer and monitor the

implementation of higher education policy objectives during the agreement period.

Evaluation

• The HEIs are responsible for the quality of their education, research and other activities, and for their continuous development and utilisation.

• The quality of performance is indirectly taken into account in the MoE indicator targets and in the monitoring of their attainment.

• Regular evaluations and external audits of quality assurance systems are undertaken to enhance the quality and impact of the educational, research and artistic activities of the universities. The findings of the evaluations are published.

• The evaluations are organised by the Finnish Higher Education Evaluation Council (FINHEEC), and the Academy of Finland. – The findings of the evaluations are published.

• The HEIs, the National Union of University Students in Finland (SYL) and the Ministry of Education are looking into possibilities for a university student feedback system

19.04.23External funding: Academy of Finland

• Public financing and expert organisation for scientific research

• Competitive funding with external evaluation• Promotes

– High-quality scientific research– Diversity and renewal of research– International co-operation

• Research Councils within Academy of Finland– Biosciences and Environment– Culture and Society– Natural Sciences and Engineering– Health

• Budget 309 million euro (2009)

19.04.23External funding: Tekes –

Funding Agency for Technology and Innovation

• Public financing and expert organisation for technological research

• Promotes – the competitiveness of Finnish industry and the service

sector• Aims

– To diversify production structures,– increase production and exports, and – create a foundation for employment and social wellbeing.

• Finances– R&D in companies, but also in research institutes and

universities• Budget 650 million euro (2009)

Source: Statistics Finland

Budgetaryfunding 439 M€ 50 %

Externalfunding 433 M€ 50 %

Academy of Finland 32%

Tekes, 18%

Other public, 17%

Finnish Enterprises, 12% EU, 9 %

Other foreign, 4 %

Foundations, 5 %

Ow n funds, 3 %

Distribution of external funding,

433 M€

Total 872 M€ (2005)

Distribution of research funding in universities

Enterprises Universities Public Sector Total

OECD 1.55 0.40 0.30 2.25

U.S.A. 1.85 0.35 0.40 2.60

EU-27 1.10 0.40 0.25 1.75

Japan 2.60 0.45 0.35 3.40

Canada 1.05 0.70 0.20 1.95

Finland 2.45 0.65 0.35 3.45

Source: OECD

Breakdown of investment in R&D in 2006 by sector (% of GDP)