The politics of fees in higher education

OPINION | EDUCATION AND POLITICS

By Prof. A.B.K.kasozi

In countries where the state has traditionally paid most of the cost of higher education, introduction of, or changing levels of fees, or any other form of cost sharing, is a politically contentious issue. 

Students and parents (even those able to pay as evidenced by their sending kids to "first world" kindergartens and schools) are opposed to upward changes in fees levels however high the cost of providing quality education by institutions escalates. 

Elected lawmakers, sensitive to the political impact of fees on the wishes of voters, often block fees increases although they may be aware that such an action often reduces the quality of education delivered and impinge on the institutional autonomy of universities. But it is also true that the few students from poor families who make it to higher education institutions are disadvantaged if fees levels are hiked. But many able students actually hide in the umbrella of the poor to protest against raising fees to unit cost levels. As a result, raising of fees has led to adverse political consequences in the past. It is reported that one of the reasons the Labour Party in the UK was returned with a reduced majority in 2004 was its earlier decision to raise fees (Shattock:  2005). 

In Uganda, in June 2005, Parliament reversed Makerere's proposed hike of fees to align it with a reasonable percentage of what it then cost the institution to educate a student (unit cost). 

In November the same year, students at the same institution went on strike when the institution hiked examinations fees from about  (Ushs.3000)  $2.00 to about (Ushs.100, 000), $75.00.  Students were reportedly injured in the subsequent chaos. Since the realistic cost of teaching a student in most Ugandan institutions of higher learning is far higher than fees paid, it is those institutions that can freely sell their higher education products at market value that are likely to sustain the delivery of quality higher education.

Fees paid in most of Ugandan higher education institutions are lower than unit costs.
In most universities, students pay about 40% of the annual cost of the programmes they are registered for. 

Government institutions, with decreasing government budget allocations to education coupled with aging infrastructure, decreasing inability to purchase inputs and increasing student numbers are the most affected by the gap between fees paid and what it costs them to graduate a student.

In public and private institutions, fees paid are lower than the unit costs.  A study done by the National Council for Higher Education for the year 2008/9 for four public universities found the following costs:

    Bachelor of Agriculture                                              9,406,106.000
    Bachelor of Arts                                                         4,252,764.000
    Bachelor of Development Stud                                  4,019,799.000
    Bachelor of Business Administration                         4,179,822.000
    Bachelor of Education with Arts                                5,655,301.000
    Bachelor of Education with Sciences                         5,989,039.000
    Bachelor of Economics                                               4,219,708.000
    Bachelor of Medicine & Surgery                               10,565,591.000
    Bachelor of Sciences                                                  7,882,535.000
    Bachelor of Statistics                                                  4,003,911.000
    Bachelor of Information Technology                         3,364,669.000

 

The money received as fees in the universities surveyed were far lower than the above costs, meaning that there was a gap between fees paid and unit costs, which could only be filled by delivering inferior education! A subsequent study by the office of the Auditor General compared unit costs in Uganda and India. That study did not find alarming differences in what it costs to educate a student in Uganda and India in a number of programmes except the science based ones. For example, it costs more than four times to graduate a medical doctor in India as it does in Uganda.

It is true that fees are not the only sources of income for universities. But, unfortunately, in Uganda, fees constitute the major source of income for education institutions as they make up to 60% and over of annual institutional budgets. 

Donations, endowments and business activities do not, for most higher education institutions in this country, constitute a significant component of annual budgets.  Fees remain the financial lifeblood of institutions.  If universities are to deliver quality higher education, they need to receive full payment of what it costs them to educate a student from fees or the government. But this is not to say that this money should come from parents and students.

Other sources must also contribute to the funding of higher education. What is required are innovative ideas to raise money for funding higher education. A national diologue on higher education is needed to debate this issue.

Insufficient funding of university institutions is gradually lowering the quality of higher education.
An extensive survey of institutions by the National Council for Higher Education conducted in May - July 2004 observed  that "all higher education institutions do not have adequate financial resources to improve and expand the physical infrastructure, provide modern academic facilities, attract and retain qualified academic staff needed to deliver quality higher education" (Section 11.13, page 48).  Faced with lack of money, university administrators cut on educational inputs to balance budgets.  In turn, this affects quality.

Many high schools charge high fees
A number of high schools, the so-called "First World Schools" charge fees which are higher, or equal to those, paid to universities.  Yet the politics of fees that is contributing to the decay of Uganda's university system is apparently absent at the school level. Schools are be able to charge fees at market value without undue pressure from the parents, public and the political system. 

Universities need more expensive inputs in terms of skilled human resources, equipment and other facilities to deliver quality higher education than high schools. But this is not to imply that high schools do not need the money they charge. All I am pointing out is that higher education institutions should charge what it costs them to deliver required products and it is up to society to devise innovative ways of finding the money needed instead of denying these institutions the resources for the proper delivery of quality education. 

Stopping higher education institutions from setting appropriate fees is like asking a manufacturer to sell products below production costs.  Such a manufacturer will either go out of business or supply inferior products to balance his books. If we cannot ask other producers to sell products below production levels, why should we ask universities to do so?

What are the options?
To resolve the problem of funding of public schools, the following options are suggested:
-We should extend the liberalized market policy to universities. Uganda prides itself in having a liberalized economy where monopolies and the regulation of market forces have been broken down.  This policy should be extended to universities.  The market should be allowed to determine fees in higher education institutions so that administrators can sell their products at cost or with a little profit to invest in facilities and infrastructure.

-The government and its agencies should not micromanage public university institutions.  Parliament, the Ministry of Education and Sports and the National Council for Higher Education should respect the institutional autonomy of universities guaranteed in section three of the Universities and Other Tertiary Institutions Act, 2001. The setting of fees in universities and other higher education institutions should be left to each university council as the Act states.

-Although increases in fees must take into account national incomes per capita, it must be understood that the training of skilled good personnel like doctors, lawyers, engineers, vets, computer experts and other professionals is not cheap. There is a minimum cost of inputs required to train a quality professional.  Therefore in Uganda' difficult situation, fees and other funding of higher education should strike a balance between current and realistic unit cost.  However, the buyers of higher education should prepare themselves to pay the real cost of this commodity instead of pushing the cost to institutions. The culture of cost sharing must be accepted to develop however unpopular or the quality of our higher education will drop.   

-The state and parents alone cannot finance higher education.  The participation of the private sector must be boosted by more incentives such as tax relief on all education materials and user-friendly legislations.  As soon as is possible, public, chartered and statute universities should receive tax relief such as exemption from VAT payment and customs duties. Individuals and corporations donating to higher education should be exempted from tax on donations they make.
       
Scholarships and loan schemes
These should benefit able but poor students to borrow money for fees and pay back when they start to earn.  The loans scheme that is in the pipeline should be operationalized provided a mechanism to identify needy students is built in the scheme.  Since the areas of need are many, the government should continue funding key strategic areas of the tertiary sector such as science and technology and progressively move away from funding institutions to funding programmes and required skills.  A planned withdrawal of funding the welfare components of education such as boarding, lodging and travel in institutions where it exists should be started.

Ugandan taxpayers should not subsidize foreign students.  The latter should immediately pay fees based on realistic unit costs in Uganda's tertiary sub-sector.
       
The tertiary percentage share of the Ministry of Education and Sports budget should be increased from the current 9 - 15% to 25% or more.  In the past, the focus has been put only on the primacy of primary education. The policy was appropriate at that time, but UPE has now stabilized and its products are in tertiary level classes.
       
The looming financial crisis in universities, which could retard sustainable development are due to reduced skills capacity.  These skills are obtainable in well-funded tertiary institutions.  To begin to address the crisis, the country should be prepared to change its attitude towards higher education by shifting training attention from focusing mainly on universities to other sub-sectors of our tertiary education system. 

We must get our youths interested in the middle level skills obtainable from other tertiary institutions including community colleges, polytechnics, institutes of technology, diploma awarding health, agricultural, engineering, commerce and other colleges. Indeed, the Tony Blair Commission for Africa recommended that $3 billion should be set aside to develop centers of excellence in science and technology including African institutes of technology (2005:138).   

The Commission also recommends donors to focus on salary enhancement versus university expansion as a way to retain qualified staff but set only $500 million over a period of ten years to revitalize African institutions of higher Education.  The current skills capacity bottleneck in Africa is due to the inability of the tertiary sub sectors to produce skilled human resources because they are underfunded.  This bottleneck is compounded by the exodus of trained human personnel and import of skilled technical workers for:
-70,000 highly skilled Africans leave the continent each year for lack of appropriate domestic employment where their skills can be appropriately used and paid for.
-The skilled expatriate bill costs Africa $4 billion as "technical" assistance each year.
-More African scientist and engineers work in the USA than in the whole of Africa  (Commission for Africa:  137-9)

Conclusion
The government, its agencies, parents and students must accept that the cost of providing quality higher education is high and increases with increasing costs of living.  If stakeholders are not ready to accept cost sharing, institutions will cut, as they already are doing, on education inputs, which, in turn, translate into the delivery of inferior higher education.  Public universities are likely to suffer most because they are more subjected to political and student interference than private ones.  These institutions may apparently have more funding because of government allocations.  However, lack of institutional autonomy in the management of their affairs will, in the long run, to disadvantage them vis-à-vis private institutions.  The population must accept to pay for what it costs to provide higher education products. Society should find the money to educate its citizens instead of pushing the problem to higher education institutions to alone resolve the problem.