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					Financing, resources
diversification, private funds
                       Daniel Münich
                      (CERGE-EI, MŠMT)
 TRENDS

        ~1995 – 1999                      ~2000 – 2006
Slow growth of funding            Fast growth of funding
Growth of enrolment               Rapid growth of enrollment
Real per student funds fell 26%   Growing real funding per student
                                  Spending per student still bellow
                                  1995 CR levels and bellow OECD
                                  average
                                  Lack of private funding
                                  ..and efficiency of spending?
  STRENGHTS &CHALENGES

              Strengths                        Challenges
Normative funding formula            Lack of transparency
(should be costs not actual costs)   Little emphasis on soc-econ needs
                                     Growing real funding per student
Weight put also on graduation rate   Effective control of budgets
                                     and allocations within institutions
Development programs (competitive)   Over-reliance on public funding
                                     Small share of private providers
OVER-RELIANCE ON PUBLIC FUNDING
• Private funding from:
  – Students (domestic, EU, non-EU)
  – Firms (R&D, innovations, students)
  – Other

• Consequences
  – Constraint of faster growth of the system
  – Inefficient behavior of students and schools (incentives)


           …introduce fees and attract private sector
FRAMEWORKS FOR PRIVATE FEES/TUITION (1)


• Student loan system, need-based scholarships

• Differential fees by level of studies
   – BA, MA, foreign students: pros & cons, Irish experience?


• Encourage growth of private tertiary sector
   – make students eligible for public loans/scholarships
   – real estate endowment (?)
FRAMEWORKS FOR PRIVATE FEES/TUITION (2)


• Dual fee system
  – Charge more market based programs, non-EU students.
  – Higher tuition subsidies (public) to priority fields


• Parallel fees structures – not recommended

• Attract support from industries (students and R&D)
REFORM OF FINANCING
• Current funding mechanism
  –   streamlined and transparent
  –   according to normative (current) costs) (?)
  –   according to labor market needs (?)
  –   more responsive to soc-econ needs (?)
  –   consolidate graduate-base component
  –   who will decide?
  –   is there a space left for customer’s preferences and
      competitive forces?
• Greater governance power to management
  – priorities setting (feedback?)
  – allocation of funds
INCENTIVES, INFORMATION, COMPETION

                                 Government

    Rules, goals,
                                     Information flows
  incentives setting




                       Schools                     Students




                                   Firms


   Can we afford relying on smart central planning?
  Is there a space for disciplining competitive forces?

				
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posted:2/8/2010
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