Funding to Universities Reduced in UK

Worldwide trend is to reduce funding to universities forcing them to stand on their own feet. Soon this will catch trend in Gulf. Better be prepared for the worst.


Here is link to the news item
http://www.guardian.co.uk/education/2010/jan/19/university-cuts-peter-mandelson

Universities will benefit from tighter budgets in the long termThe relatively small cut in public funding does not mean a lack of commitment to higher education

In 2009, the government made it clear that higher education would have to shoulder its fair share – but not more than its fair share – of reductions in public spending in the years ahead. Critics of this decision have suggested it will bring British higher education to its knees. Figures from the Institute of Fiscal Studies have further fanned the flames. However, these figures are purely speculative and, in reality, the savings we have set out amount to a reduction of under 5% over the next three years. We need to have a reasoned discussion over how to maintain university teaching and research quality in the face of the wider fiscal realities.

A more positive view makes a virtue of fiscal necessity, especially when you look at the big trends in British higher education.

Tighter budgets can be a spur to further diversifying the funding of British universities. It can also focus minds on teaching and research excellence and new ways of delivering higher education. Both of these trends are already part of the picture of British higher education. Both need to become more so.

UK universities have never enjoyed such a long and sustained period of public financial and political support. Since 1997, we have put higher education at the centre of our strategy for building a modern knowledge economy.

In line with this, public investment in British universities has grown by 25% since 1997, reversing a decade of declining investment and standards under the Conservatives. Our research base is now one of the best in the world, and our share of world-class institutions is out of all proportion to our size.

But even with these big increases, public funds represent only a little more than half of university income in Britain. With strong government backing over the last decade, many British universities have taken a more professional approach to attracting donations and endowments. They have widened their sources of income by opening their doors to fee-paying international students and by building more collaborative relationships with business and industry to fund research and teaching. The introduction of higher fees in England has also provided an alternative source of income. These developments are not a reason for removing public funding, but they do lend perspective to the subject.

The result of this growing diversity in university income is that although the government invests £12.3bn in higher education annually, total UK university income was over £23bn in 2007-08. So the proposed £950m in reductions over the next three years affects only a small part of university resources. Even within this stream of public investment, teaching and research funding will still actually grow between 2009-10 and 2010-11. Research funding will grow in real terms this year by 7%. Farsighted universities will use a small reduction in state funding to look at avoidable costs, reinforce diversification and focus minds on what they do best.

Part of the bargain that has included unprecedented levels of support for higher education, and wide autonomy for how it is spent, is the expectation that universities develop unique missions. They should focus on excellence, even where this means withdrawing from areas of teaching or research where they are weaker. The best British universities are already doing this.

Our recent Higher Ambitions policy framework for universities encourages them to develop alternatives to the basic three-year degree, including courses and types of study that are more flexible or more vocational, but still of the highest quality. This focus on new ways of enabling people to gain higher education qualifications is part of a broader reshaping of university study, driven by the fact that school leaver numbers will fall over the next 10 years.

Because they can be based around work or study from home, these routes to qualifications are more attractive to a wider range of people. Importantly, against the backdrop of a gradual reduction in public funds, they also mean lower student support bills, and can attract contributions towards course costs from employers. Developing these alternatives can be a way of universities and colleges saving public money without reducing the quality of teaching. Some universities are already doing this successfully. Their example needs to be followed.

It has never been credible to argue that the UK can support world-class higher education purely on the back of public funding. Universities themselves have often made this case. The best university systems in the world are defined by a wide range of public and private funding and British universities need the same diversity. High levels of public funding for universities in Britain is important for our competitiveness and will always be vital, but it is only part of the picture.

I don't deny that this is a challenging agenda. But by no stretch of the imagination does a 5% reduction in public support over a number of years for universities reverse a decade of committed investment in universities, or leave our best institutions on their knees. It can, however, be an opportunity to do some clear thinking about the future of British higher education.

A good Article on how universities can be innovative

Read today a nice article on how universities can be innovative here
http://www.khaleejtimes.com/displayarticle.asp?xfile=data/opinion/2010/January/opinion_January111.xml&section=opinion&col=

Time for Universities in the Gulf to Become Entrepreneurial
Dr Alimohommed Bhayani (ISSUES)19 January 2010
Universities the world-over have jumped onto the bandwagon of becoming entrepreneurial due to the changing economic environment in which they operate.
The concept of ‘Entrepreneurial Universities’ caught the attention of academia after the publication of Burton Clark’s, Emeritus Professor at the University of California, landmark book (‘Creating Entrepreneurial Universities: Organisational Pathways of Transformation’, published in 1998) on the subject. Many universities have since become entrepreneurial or at least claim to be entrepreneurial. The Gulf region has yet to catch up on this concept, which is very new here.
In a broad sense, entrepreneurism means any activity undertaken by universities in order to diversify their income sources and this includes expanding teaching capacities, creating innovative course offerings, internationalisation, getting fee paying self supported students, research and technology transfer. However, in the strict sense, entrepreneurism is limited to the creation of university-industry relationship to capitalise on the research capacities and capabilities in universities and enhance technology transfer. Henry Etzkowitz, Professor at Newcastle University and expert on Higher Education, outlining the importance of entrepreneurial universities to knowledge economies, states that “it is this capitalisation of knowledge that is the heart of the new mission for the universities, linking universities more tightly to users of knowledge and establishing the university as an economic actor in its own right”. Traditional concept of universities as conservators and creators of knowledge has been expanded to include the practical utilisation of knowledge. An entrepreneurial university is one that has the ability to innovate, recognise and create opportunities. It is a university that works in teams and encourages risk-taking behaviour and is quick in responding to changes.
Many advantages are accrued to universities in the US and Europe, which have become entrepreneurial. Universities that have successfully patented their research outcomes and commercialised them have reaped direct advantages like increased income for both university and researcher. State governments, observing these technology transfer activities, have provided additional funds or access to proprietary technology and equipment. There are other non-monetary rewards such as prestige and the exchange of knowledge with industrial researchers. The most important advantage of this technology transfer activity is a stronger relationship between universities and industry, which in turn will help universities to train students in new techniques and also ensure that graduates are suitable to work in industry. In addition to this, it helps in creating student internship and job placement opportunities that will encourage future graduates to acquire practical knowledge.
In the Gulf, there is a need for both the broad and strict entrepreneurial activities, in order to develop a knowledge economy. Public universities in the Gulf will need to be made more accountable as they are backed by public resources and have a mandate to build the knowledge economy. The leaders in the Gulf have recognised the importance of building the knowledge economy and to that end companies, institutions, and society will need to focus on skills development. The ability to develop human resources and to ensure continuous competency building will be the dominant requirement to sustain competitiveness for companies and prosperity for society. The first priority for public universities in the Gulf is to invest in research capacity. Most of them are highly oriented towards teaching and even when they are doing research; this research is not passed to industry for commercialisation.
The main reason identified by experts as an inhibitor to entrepreneurism in (Gulf) universities is a stable funding mechanism. Universities elsewhere have been forced to find diversified funding sources as state support to them has declined over time. Public universities in the Gulf enjoy a lot of state support and this acts as a disincentive to becoming entrepreneurial. Also, the university culture (values, norms, attitudes, etc.) is central to the development of entrepreneurial activity within the institution. There needs to be a marked shift in culture, therefore, if universities are to become entrepreneurial. Rigid bureaucracies need to become more flexible network enterprises. While focusing on institutional culture, I cannot overlook the role of education leadership in the creation of entrepreneurial universities.
In conclusion, public universities need to start transforming themselves into knowledge hubs and becoming innovative. They need to rely less on public funds and become self-sufficient. One way to do this is through the encouragement of research and the commercialisation of research. This calls for flexible structures and strong and motivated leadership. With the resources derived from oil income at disposal of public universities, there is a huge potential for universities to become entrepreneurial.
Dr Alimohommed Bhayani is Chief Operating Officer of Michigan State University, Dubai. The views expressed here are his own and not of his employer