rom a nia minist ry of education, research and youth

RomaniaMinistry of Education, Research and Youth

Higher Education fundingas a strategic tool

Sorin Gabriel PopescuGeneral Director

responsible for Higher Education Funding Management

MECTHigher

Education

Starting from a structured description of the Romanian higher education funding system, the presentation intends to focus on:

the role that funding has in the development of higher education and universities’ performance, in the EU and national strategic framework;

the Romanian higher education funding dynamic in the last 4 years (2005-2008);

the main domains and directions for strategic interventions connected with the funding of higher education;

the already undertaken, current and intended measures of the Romanian Ministry of Education Research and Youth in the mentioned domains and directions;

the ways in which this strategic interventions and measures could be sustained by EU structural funds.

Presentation objectives

MECTHigher

Education

Industrial economy / society

Capital Labor

The industrial and knowledge economy/society

In the past two centuries, only labor and capital have been considered to be production factors and sources of development.

In the past two centuries, only labor and capital have been considered to be production factors and sources of development.

MECTHigher

Education

LaborKnowledge

Knowledge economy / societyIndustrial economy / society

Capital

In the past decades, knowledge, associated with technology, has become the third, and for the developed economies the main production factor.



MECTHigher

Education

Knowledge

Knowledge economy / society

Capital Labor

In such a society, knowledge – in the form of competence – offers to the individuals access to welfare, and, on the national level, together with technological progress, forms the basis for economical growth.

In such a society, knowledge – in the form of competence – offers to the individuals access to welfare, and, on the national level, together with technological progress, forms the basis for economical growth.




MECTHigher

Education The University in the knowledge-based society

In this context:

universities, as main sources of knowledge within society, become key factors of its wellbeing;

for Romania, as for any modern country, investment in Higher education should ensure maximum benefits in the long term, as it is one of the most efficient mechanisms of sustainability in the global competition for resources and development.

The mission statement of universities should be re-written for the knowledge-based society like this:

To contribute to the economical development and to the wellbeing of the society by transferring knowledge towards individuals and the socio-economic environment that it serves

MECTHigher

Education Relationship between funding and performance

There is a proven correlation between the funding and the performances of universities.

The Report entitled “An Agenda for Reforming European Universities”, prepared and published in July 2008 by a group of international experts (professors of economics from universities as Harvard, Stanford, Oxford and Université Libre de Bruxelles) for the Bruegel Foundation determines the influencing factors of the research performance of European universities (the Shanghai Index):

average level of the expenditure per student;

financial autonomy of universities and the entrepreneurial behavior of the universities’ leaders;

the methodology for the distribution and allocation of funds: encouraging a minimal standard (equal distribution for all universities) or the orientation towards excellence (preferential financing of universities with relevant potential);

international mobility of students, but especially the mobility of teaching and research staff.

MECTHigher

Education

0

50

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0 5 10 15 20 25 30 35 40

Shanghai 500 Index

Expenditure / student [x1000EUR]

US

SW

DE

SE

NEUK

BE

HU

CZGR SP

ITFR

EU

FI

GE

IRAU

The average yearly expenditure/student in the EU is 8700 EUR, with most of the countries grouped around the same funding-performance index. The champions are Sweden and Switzerland, while the countries in Eastern Europe have worse positions in this graph.

Romania has in 2008 about 4000 EUR as level of expenditure/student from public funds and it is present with any university in the Shanghai 500 ranking.

Relationship between funding and performance

MECTHigher

Education

REGULATORY, STRATEGIC AND STEERING FRAMEWORKREGULATORY, STRATEGIC AND STEERING FRAMEWORK

EU regulationsEU regulations

National Regulations & ProgramsNational Regulations & Programs

SOURCESSOURCES ALLOCATIONALLOCATION MANAGEMENTMANAGEMENT

Public funds exp.Public funds exp.

Univ. regulationsUniv. regulations

PERFORMANCEPERFORMANCE

Instit. capabilityInstit. capability

ProcessesProcesses

Entrepreneurial skills & behavior of universities’ leadersEntrepreneurial skills & behavior of universities’ leaders

NEED-REQs.NEED-REQs.

National SE Env.National SE Env.

End beneficiariesEnd beneficiaries

National&Europ.

Academic Env.

National&Europ.

Academic Env.

SATISFACTION &

EFFICIENCY

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MethodologyMethodology

Direct contractDirect contract

Grant/ProjectGrant/Project

National BudgetNational Budget

Structural FundsStructural Funds

Economic Env.Economic Env.

Individuals-Fees Individuals-Fees

EU Strategic and Steering DocumentsEU Strategic and Steering Documents

National Strategic & Steering DocumentsNational Strategic & Steering Documents

Romania – HE funding framework

MECTHigher

Education


National SE environment


Endbeneficiaries

Endbeneficiaries

National&EuropAcademic Env.

National&EuropAcademic Env.

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The national socio-economic environment is the main beneficiary of the HE system: education (bachelor/master/doctoral/life long learning), scientific research results and direct assistance (consultancy and professional services).

The individual/end beneficiaries are persons (students) who want to study to gain competences and recognition and their requirements range from the study program characteristics and its international recognition, to the accommodation and transport facilities offered by universities.

The members of the national and European academic environment express needs/requirements that are specific to their level: from the institutional level (e.g. compatibility) to the individual level (e.g. opportunities and funding of mobilities).

These needs and requirements have to be identified both at the entire HE system level and at the individual components (universities) level.


SATISFACTION &EFFICIENCY

MECTHigher

Education

The regulatory, strategic and steering framework:

• assembles the regulations, strategies, and plans both at the EU and National levels and

• provides the reference framework for the HE system and for its funding.

Its functions are:

• system planning: establishing policies, priorities, objectives, measures, resources, responsibilities for medium and long term;

• system control: regulations that have as aim to put in practice these instruments at different action levels.




EU Strategic and Steering documentsEU Strategic and Steering documents

National Strategic & Steering documentsNational Strategic & Steering documents


Endbeneficiaries

Endbeneficiaries

National&Europ.Academic Env.

National&Europ.Academic Env.

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SATISFACTION &EFFICIENCY

MECTHigher

Education

ALLOCATIONALLOCATIONSOURCESSOURCES







Individuals-FeesIndividuals-Fees

EntrepreneurshipEntrepreneurship

The State budget provides two main components: •Basic funding: current expenditure (staff and operating costs) - 70% provided according to the equivalent number of students and 30% based on the quality indicators (2008);•Complementary funding: investments and repairs, students’ scholarhsips, eating/accomodation/transport subsidies, special programs, cultural and scientific events, scientific research (by competition).

European and international funds allocated as grants for projects obtained through competition in accordance with strategic priorities.

Funds from private organisations and persons coming mainly in return for services such as: training, consultancy or research. These funds are based on service or study contracts with economic agents or institutions. A very small percentage is constituted in present from sponsorships, donations and private scholarships.

The entrepreneurial skills and behaviour of universities’ leaders are key elements in identifying and attracting extrabudgetary funds.


MECTHigher

Education

SOURCESSOURCES MANAGEMENTMANAGEMENT





ProcessesProcesses


• Universities are autonomous in deciding how they manage and spend funds;• Autonomy has to be integrated to the national and European legal and

regulatory framework;• Universities may also add internal regulations;

ALLOCATIONALLOCATION










• The leadership’ s entrepreneurial skills and behaviour plays an important role in motivating people and in the efficient spending of funds and the generation of performances according to the spent resources.

MECTHigher

Education Data regarding HE financing dynamics in Romania

526.

062.

271

668.

782.

142

819.

127.

251

1.08

1.69

9.83

2

1.31

6.77

6.58

3

2.14

2.90

0.58

7 3.45

2.02

2.43

1

3.76

1.88

3.44

2

0

500.000.000

1.000.000.000

1.500.000.000

2.000.000.000

2.500.000.000

3.000.000.000

3.500.000.000

4.000.000.000

2001 2002 2003 2004 2005 2006 2007 2008

Le

i( R

ON

)

Financial year

Total financing Higher Education

121,

73%

198,

10%

319,

13%

347,

78%

100,00%

150,00%

200,00%

250,00%

300,00%

350,00%

400,00%

2005 2006 2007 2008

Pe

erc

en

t c

om

pa

red

to

20

04

Financial year

Total financing Higher Education

2008 compared to 2000

7.2 times increase


7.2 times increase


cca. 3.5 times increase


cca. 3.5 times increase

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Education

270.

000.

000

380.

000.

000

477.

490.

371

633.

146.

957

847.

263.

511

1.04

1.34

6.21

7

1.18

1.33

6.00

0

1.68

0.72

8.00

0

1.94

7.26

7.00

0

0

500.000.000

1.000.000.000

1.500.000.000

2.000.000.000

2.500.000.000

2000 2001 2002 2003 2004 2005 2006 2007 2008

Le

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ON

)

Financial year

Base financing

2008 compared to 2000 - 7.2 times increase




Data regarding HE financing dynamics in Romania

MECTHigher

Education

12.7

81.7

00

22.7

53.0

00

23.4

70.0

00

26.5

00.0

00

5.20

0.00

0

14.4

09.5

50

254.

121.

000 38

3.17

9.00

0

415.

995.

000

-50.000.000

0

50.000.000

100.000.000

150.000.000

200.000.000

250.000.000

300.000.000

350.000.000

400.000.000

450.000.000

2000 2001 2002 2003 2004 2005 2006 2007 2008

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ON

)

Financial year

Investments

2008 compared to 2000-2004 average - 23 times increase2008 compared to 2000-2004 average - 23 times increase


MECTHigher

Education

6.08

6.00

0

92.9

50.7

00

103.

968.

000

104.

766.

000

0

20.000.000

40.000.000

60.000.000

80.000.000

100.000.000

120.000.000

2005 2006 2007 2008

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i( R

ON

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Financial year

Educational facilities

7.59

3.54

0

59.0

16.0

00 94.6

85.0

00

156.

863.

000

0

20.000.000

40.000.000

60.000.000

80.000.000

100.000.000

120.000.000

140.000.000

160.000.000

180.000.000

2005 2006 2007 2008

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ON

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Financial year

Consolidations

6.62

2.92

0

105.

389.

300

483.

403.

000

453.

877.

000

0

100.000.000

200.000.000

300.000.000

400.000.000

500.000.000

600.000.000

2005 2006 2007 2008

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ON

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Financial year

Rehabilitations (total)


MECTHigher

Education

Accomodation and eating subsidies 39

,600

,000

43,4

27,4

21

51,2

52,5

60

67,4

74,7

00

78,0

74,8

00

96,8

54,4

95 132,

476,

025

153,

014,

160

0

20,000,000

40,000,000

60,000,000

80,000,000

100,000,000

120,000,000

140,000,000

160,000,000

180,000,000

2001 2002 2003 2004 2005 2006 2007 2008

Financial year

Le

i( R

ON

)

102.

729.

831

118.

702.

530

130.

570.

859

144.

945.

514

171.

545.

710

189.

634.

218

80.000.000

100.000.000

120.000.000

140.000.000

160.000.000

180.000.000

200.000.000

2003 2004 2005 2006 2007 2008

Le

i( R

ON

)

Financial year

Student scholarships fund


MECTHigher

Education Systemic overview of the national HE system

Quality is resulting from the measure in which the entire systemand its institutional entities (universities, Ministry,

national agencies / councils etc.) answer to specific needs/requirements.

Quality is resulting from the measure in which the entire systemand its institutional entities (universities, Ministry,

national agencies / councils etc.) answer to specific needs/requirements.

NEEDS-REQUIREMENTSThe leading axis, defining the

independent variable of the entire academic demarche

Needs for knowledge: competence, innovation, assistance in solving problems of the socio-economic

environment

PROCESSES Develop processes needed by the

generation of educational products

Main: education, research, consultancyManagerial: strategic/quality/

human resource/financial/ managementSupport: maintenance, investment,

procurement etc.

PRODUCTSDevelop products in

accordance with the needs-requirements

Study programs, Research projects, Assistance

contracts

SYSTEM AND INSTITUTIONAL COMPONENTS

Institutional capability for answering to the need-

requirements

Structure, rules, managerial paradigm, human resources/

infrastructure/financial resources etc.

MECTHigher

Education Romanian HE system – Vision building

Two possible visions, that must be mergedTwo possible visions, that must be merged

NEED FOR EDUCATION

Orientation towards minimal standards

NEED FOR EDUCATION

Orientation towards minimal standards

NEED FOR RESEARCH AND

INNOVATIONOrientation towards

excellence

NEED FOR RESEARCH AND

INNOVATIONOrientation towards

excellence

Generate new knowledge through research and innovation, pertaining to top technologies, and develop international prestige. The overall performance of the HE system is given mainly by the top results of some universities, with focus on excellence.

Satisfy the need for education of people and for competent specialists of the socio-economic environment. The overall performance of the HE system is given by the sum of the performances of individual universities and the quality orientation is to assure the minimal standard for each of these institutions.

MECTHigher

Education

A possible vision for the Romanian HE systemA possible vision for the Romanian HE system

• Competitive and capable to contribute to the economical growth and country’s welfare, generating and transferring knowledge towards the socio-economic environment;

• Socially equitable, offering accessibility to everyone who wishes to study, independent of background;

• Presents an attractive and diversified educational offer oriented towards the medium and long term needs of the country;

• Participant in the European HE Area reform process and an integral part of the HE internationalisation process;

• Accountable to the citizen (tax-payer), ensuring a transparent and justified usage of funds.

■ Strategic project Quality and leadership in Romanian Higher Education - 2025 Visionand strategic recommendations for 2009-2013 . International partners: Fraunhofer Inst. for Systems and Innovation Research, Institute for prospective Technological Studies, UNESCO- European Centre for High. Educ., EUA.

■ Strategic project Quality and leadership in Romanian Higher Education - 2025 Visionand strategic recommendations for 2009-2013 . International partners: Fraunhofer Inst. for Systems and Innovation Research, Institute for prospective Technological Studies, UNESCO- European Centre for High. Educ., EUA.

Romanian HE system – Vision building

MECTHigher

Education




SOURCESSOURCES ALLOCATIONALLOCATION MANAGEMENTMANAGEMENT





ProcessesProcesses



National SE Env.National SE Env.

End beneficiariesEnd beneficiaries

National&Europ.

Academic Env.

National&Europ.

Academic Env.

SATISFACTION &

EFFICIENCY

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EU Strategic and Steering DocumentsEU Strategic and Steering Documents

National Strategic & Steering DocumentsNational Strategic & Steering Documents


MECTHigher

Education Directions for strategic intervention – Sources


Objective: Increase Romanian HE financing towards levels comparable to the European average of 8700 EUR/student Budgetary financingIn 2008, the total budget for education has reached 6% of GDP, with HE financing arround 4000 EUR/student. In the context of the current economic crisis, a slower rate of GDP increase is to be expected.

Possible future measures for increasing the budgetary component:•The restructuring of the budget for education, allocating a larger part for HE;

•The increase of the research budget up to 1% from GDP by 2010 from 0,7% in 2008.

MECTHigher

Education


Individuals-FeesIndividuals-Fees

Objective: Attraction of private capital in HE institutions (from individual participants and companies) Current and evisioned measures:•Improving the antreprenorial abilities and behavior of the universities’ leadership; •Creating financial attractiveness for investments in HE within public-private partnerships;•Encouraging organizations to invest in the development of their own human resources (1.5% of the total salaries invested in training or collected as tax);

■ Current ESF strategic project Improving universities management – managerial training of the universities’ leadership in partnership with Institute of Education – London Univ.■ Set-up of the Agency for Internationalization of HE (working group created in June 2008 aimed to develop the strategic and regulatory framework, a strategic project for financing intended to be launched in 2009, International partners: ACA and British Council).

■ Current ESF strategic project Improving universities management – managerial training of the universities’ leadership in partnership with Institute of Education – London Univ.■ Set-up of the Agency for Internationalization of HE (working group created in June 2008 aimed to develop the strategic and regulatory framework, a strategic project for financing intended to be launched in 2009, International partners: ACA and British Council).

• Increasing the revenues from individual fees by attracting international students outside the EU.

• Increasing the revenues from individual fees by attracting international students outside the EU.

Directions for strategic intervention – Sources

MECTHigher

Education

Public funds exp.Public funds exp.National BudgetNational Budget

Current strategic projects: ■ Quality assurance in higher education in Romania ■ Structuring of doctoral schools■ Doctorates in excellence schools - evaluating quality of research ■ Doctoral scholarships

Current strategic projects: ■ Quality assurance in higher education in Romania ■ Structuring of doctoral schools■ Doctorates in excellence schools - evaluating quality of research ■ Doctoral scholarships

Directions for strategic intervention – Expenditure

Objective: Encouraging performance of universitiesCurrent and evisioned measures:• Introduction within the funding framework of new fund for institutional

development, addressed to a reduced number of universities, that can prove relevant academic and research performances, according to international ranking systems

• Encouraging concentration of resources within consortiums of universities, student campuses and common research units;

• Improving financing framework based on existing quality criteria and indicators (30% of base financing);

• Improving the quality of education provided by universities within all Bologna cycles.

MECTHigher

Education Description of the strategic projects

■ Quality assurance in Higher Education in RomaniaEnvisioned results: Improvement of the ARACIS (Agency for Quality Assurance in HE) evaluation methodology; Institutional evaluation of 45 universities; Transversal evaluation of bachelor programs.

International partners: EUA.

■ Doctoral studies in Romania – Structuring of doctoral schools

Envisioned results: Recommendations for establishing doctoral schools; Indicators for evaluating the quality of doctoral programs; Procedures for the accreditation of doctoral schools.

International partners: UNESCO- European Centre for High. Educ., EUA.

■ Doctorates in schools of excellence – evaluating quality of research

Envisioned results: Methodology for international evaluation of the quality of scientific research in Romanian universities; A program entitled Universities of Excellence in Romania; 30 new ISI indexed journals.

International partners: UNESCO- European Centre for High. Educ.

■ Doctoral scholarships (26 projects in 2008, 23 universities)

Envisioned results: 2312 PhD. students with scholarships of 500 EUR/month while in Romania, and 1000 EUR/month for 8 months while at a university within the EU.

MECTHigher

Education

Public funds exp.Public funds exp.Methodology Methodology

Strategic project■ Set-up of the Agency for students’ loans with assistance from the World Bank. In 2009, the Agency will be launched and, for becoming operational, another yearwill be needed.

Strategic project■ Set-up of the Agency for students’ loans with assistance from the World Bank. In 2009, the Agency will be launched and, for becoming operational, another yearwill be needed.

Obiective: Equal opportunities to access higher education

Current measures:• Increasing the amount of funds and the program attractiveness for

facilitating the access to HE of disadvantaged categories of young people (e.g. rroma minority, scholarships for students from rural areas);

• Set-up of an Agency for students’ loans (World Bank Experts have developed possible scenarios and the Agency has been initiated through an emergency Ordinance that is awaiting approval);

Envisioned measures:• Improvement of the legal framework in order to encourage the students’

financial support by private funding (private scholarships, private loans, summer employment).

Directions for strategic intervention – Methodology

MECTHigher

Education




Strategic project launched in May 2008■ „Improving universities management”■ „Students’ Register”

Strategic project launched in May 2008■ „Improving universities management”■ „Students’ Register”

Directions for strategic intervention – Management

Objective: Improving the entrepreneurial competences, skills and behavior of universities’ leaders and the development of ICT infrastructure for managerial support.

Current and evisioned measures:• Training of the universities leaders in the next 2 years within 6 centers with assistance from the Institute for Education – London University. In these centers, there will be set up master programs in university management, in order to train the future leaders of Romanian universities;

• Encouraging universities to develop their own solution of computerized management;• Creation of the ICT infrastructure/facilities for managing the educational system at national level.

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Education

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Obiectiv: Development of methods and tools for the identification of society’s needs and requirements and for the measurement of the efficiency of investments in education

•In present, the identification of the number of specialists needed by the national socio-economic environment is difficult and costly, with low relevance (very few companies use a strategic planning of their human resources);

•A possible method for measuring the efficiency of the investment in higher education is to track graduates and to gather feedback from hiring organisations from different fields.

Strategic projects■ PHARE project finalized in October 2008, assisted by German experts from University of Kassel, has developed institutional and system wide methodologies, as well as the needed instruments,for tracking graduates and feedback.■ ESF project to be forwarded for financing in November 2008 by CNFIS in order to applythese instruments within a pilot study for validation at national level and for 20 universities.

Strategic projects■ PHARE project finalized in October 2008, assisted by German experts from University of Kassel, has developed institutional and system wide methodologies, as well as the needed instruments,for tracking graduates and feedback.■ ESF project to be forwarded for financing in November 2008 by CNFIS in order to applythese instruments within a pilot study for validation at national level and for 20 universities.

Directions for strategic intervention – Ident. & meas.

MECTHigher

Education Conclusions

1. HE is a strategic priority in a knowledge based economy and between quality and funding there is a proven correlation.

2. Funding is the main tool of the Ministry of Education for managing the strategic development of the HE system. Thereby, it has to be correlated with the national development strategic plans and with the domain specific vision.

3. HE funding improvement has to be focused on its final aim: answering to the society’s needs and requirements. A structured approach addresses: the funding sources (public and private), their allocation and distribution as well as their management and expenditure. A measurement of the investment efficiency is needed.

4. Although they cannot replace other funding sources, coherent usage of EU structural funds within the Ministry’s vision and strategy could bring a relevant contribution to the improvement the HE structure and capability and finally to the entire system performance.

rom a nia minist ry of education, research and youth

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knowledge economysocietyin

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