Plans to improve varsities in motion

PETALING JAYA: Malaysia is one of the biggest spenders in higher education, but yet, its performance is still less than ideal.

A recent report on 50 countries showed that while Malaysia was one of the top spenders on higher education, it was one of the weakest in terms of research output, institutional ranking, enrolment and employability.

Acknowledging this, Higher Education Minister Datuk Seri Idris Jusoh has set a plan to whip public universities into shape, by getting the most out of the money spent.

“According to U21, Malaysia is number 12 in the world for input to higher education, but 44 for output. This means we must improve our expenditure efficiency,” Idris said.

The U21 is an international consortium of universities led by Australian institutions and its network encompasses more than 1.3 million students and 220,000 staff and faculty.

According to the United Nations Educational, Scientific and Cultural Organisation (Unesco), Malaysia spent 7.7% of its annual budget on higher education in 2011, a percentage much higher than that of peers such as Hong Kong, Singapore, South Korea and even Japan.

In fact, Malaysia has not always been spending this much on education. Public expenditure on higher education has tripled in just over a decade (see bar chart).

As a matter of fact, in 2004, public expenditure for higher education was only RM4.3bil but it soon doubled to RM10.9bil in 2008.

It finally reached a peak of RM15.7bil in 2015 before being slashed the following year.

Idris pointed out that universities have grown too dependent on public funding.

According to him, the budget reduction was in line with the ministry’s planning since 2007.

“Public universities are too dependent on public funding and this is not sustainable.

“In our 2015-2025 Malaysia Education Blueprint for Higher Education, financial sustainability was re-emphasised,” he said.

Financial Sustainability is one of the main sections of the latest blueprint.

Listed under Shift #5, the section aims to help diversify the sources of funding for both private and public universities and to encourage more “prudent and innovative use of their resources”.

The investment-output inefficiency among universities has led to the Higher Education Ministry to outline four strategies to help them achieve financial sustainability.

One of it was to focus on performance funding instead of giving a block grant to universities based on a national annual allocation of seats and programmes, which, according to the blueprint, stifles growth of successful institutions and insulate poor performers from competition.

Other measures include diversifying university revenues as well as improving productivity and cost efficiency.

In fact, the agenda in managing university finances is so important that the ministry came up with another document called the University Transformation Prog­ramme – also known as the Purple Book- to assist public universities in creating and implementing their own tailored transformations to ensure long term financial sustainability.