latest trends in university funding

Thomas Estermann

Director Funding, Governance and Public Policy Development

European University Association

Porto

6 October 2016

Latest trends in University Funding

EUA Sources

Annual monitoring of trends in public funding since 2008

30 higher education systems

Midterm review of European fundingprogramms

Campaign on sufficent, sustainable andsimple funding

Latest trends in public funding

Cuts on all

fronts

Higher costs

for students

Stronger

competition

for EU money

More

efficiency

Less money

for teaching &

infrastructure

More

performance-

based

funding

Stress test

for the

frontrunners

Growing

differences

between the

systems

Focus

Recent changes and outlook

Challenges and Impact

Long-term funding trends

2015/2016 changes

Growth TR (27%), AT (9%), IS (7%), HR (6%), NO (6%), ES (3%), BE-fr (2%), PT (2%), DE (2%)

(+1%) HU, LV, NL, SE, SK

(-1%) BL-fl, IT, PL, RS

Decline UK (2%), IE (3%), CZ (5%), SL (9%), GR (16%)

Mixed Outlook for the Nordic model

Some of the frontrunners in the North show a slowdown of investment or a negative outlook:

FI has been reducing funding since 2014 and inflationary increases are frozen through to 2019

DK shows negative outlook through approved cuts through 2019

Iceland has still not closed the gap accumulated in the early phase of the financial crisis

In SE the annual growth rate slipped under 1% in 2016

Norway increases 5.6% in 2016, following a temporary slowdown in 2015 year

Challenges

Year on year fluctuations make rational strategic planning for universities very difficult

Discrepancies are growing between the systems in the EHEA and ERA

Reduction in infrastructure investment reduces competitiveness

Growing expectations from European Funding which is under pressure

Impacted areas

Teaching DK reduction 2%/year

till 2019 NL efficency cuts Decline in funding per

student in UK and IE

NO and SE increase

in funding per student

Research DK reduction of funding

1.09 % to 1.01% of GDP as of 2016 IE Programme for

Research in 3rd Level Institution has declined by approx. 80%

CZ, PL, SI, SE and

UK safeguard or even increase their research budgets

Impacted areas

Infrastructure Several countries

reduce investment and expect institutions to fund from other sources, even countries like SE

Staff Layoffs, lower

replacement rates and reduced benefits (e.g., DK, FI, IE, IT,..)

Pay rises in LV and

SK and staff replacement ratio stabilisation in ES

Shifting costs to students

In 2016, several countries introduced or discussed higher tuition fees for non-EU/EEA students:

FI will charge tuition fees for non-EU/EEA students enrolled in English-taught BA and MA programmes from 2017/2018

Tuition fees for non-EU/EEA students might go up to EUR 12,525 per year in BE-fr(current max. of EUR 4175)

New provisions in CH will allow Swiss universities to charge foreign students significantly higher tuition fees

Discussions on introduction of tuition fees for undergraduate students in IE.

Support for domestic students is reduced in some systems England expansion of loans and abolition of student support for living costs

Only ES has reported minor increase in funding for students through scholarships in 2016.

Growing competition for limited European funds

Pressure on universities to increase funding from EU sources The amount of EU funding attracted by a university is one of

the elements of performance-based funding in many systems.

Universities find it increasingly hard to obtain EU grants given the oversubscription of EU programmes and record low success rate (e.g., ca. 14% in first 100 calls of H2020).

Reduced public funding for universities affects their ability to keep up the investment in top research staff, support services and infrastructure and thus compete successfully for European funding.

Universities might gradually lose their attractiveness as partners for consortia and collaboration networks, which grow in importance.

Performance-based funding and efficiency

Governments pay closer attention to performance-based funding, efficiency measures and a more active use of output indicators:

Graduate employability is gaining importance in DK and SI

Additional funds were allocated for PBF in Latvia

Efficiency cuts are implemented in NL to reduce indirect cost coverage and optimise academic offer.

EUAs project USTREAM aims to explore measures pursued by universities across Europe in order to enhance efficiency.

A key success factor for efficiency of higher education institutions is

Please complete this sentence now online!

http://www.eua.be/activities-services/projects/current-projects/governance-funding-public-policy/ustream

Please open the following link on your device

PollEv.com/fundingforum

Long-term funding trends

Key factor Inflation

Inflation rate between 2008 and 2015

(*) Data partly sourced from the World Bank

Long-term funding trends

Key factor student numbers

Growth in 10 systems

Decline in 8 systems

Decline in particularin Eastern Europe

Growth in particular inNorth and West, and

Turkey

NB: Growth in Turkey +285%

Long-term funding trends

Key factor economic growth

Evolution in public funding to higher education institutions as a percentage of GDP between

2008 and 2015

Long-term public funding trends (2008-2015) I

Public funding to universities was growing in 11 systems.

In 7 systems student numbers were growing faster than public funding.

Frontrunners NO and SE

PT and PL cuts before 2008 and lower funding base

Rest are systems under pressurewww.eua.be/activities-services/projects/eua-online-

tools/public-funding-observatory-tool.aspx

Long-term public funding trends (2008-2015)

Public funding to universities declined in 13 systems in Europe

On top of the funding cuts, in 7 systems the student numbers were growing

In 6 systems the decline in funding was faster than the decline in the student body

England special case through tuition fee increase

What is needed

Universities, national and European policy makers need to work closer together and openly discuss and address problems

Funding needs to be aligned with expectations More focus on communicating that universities help

addressing Europes challenges like integration, social and economic crises, youth unemployment and unprecedented migration flows

Show universities direct economic impact and contributions to society

Reduce growing funding gap between the systems

Exchange and Input

Sufficient, sustainable and simple funding for

efficient universities

POLL RESULTS

https://www.polleverywhere.com/free_text_polls/q8fRofmYxYFVVke?preview=true

University Efficiency Focus Group Session:

TODAY At 17.45 18.30

Room: Sala -2 Level -2

https://www.polleverywhere.com/free_text_polls/q8fRofmYxYFVVke?preview=true

Public funding

observatory report

online now

Contact:

Thomas.estermann@eua.be

www.eua.be

@ThomasEstermann / @euatweets