Will search for self-financing distract varsities from education?

Concern over amount of money public universities can collect in face of budget cuts by government.

KUALA LUMPUR: Faced with significant budget cuts, public universities have taken steps to increase their funding.

Universiti Utara Malaysia has set up subsidiary companies that organise tours while Universiti Putra Malaysia has its “Dana Wakaf Ilmu” to encourage charitable giving by individuals and corporations.

Universiti Malaya has also established a for-profit private university called International University of Malaya-Wales to get more revenue.

Institute for Democracy and Economic Affairs (Ideas) chief operating officer Tricia Yeoh said all these measures were commendable but felt the government had failed to properly prepare public universities for financial independence.

“Some observers have voiced concerns that these activities may distract the universities from their main objectives of teaching and research.”

Yeoh was speaking at a roundtable discussion on autonomy and accountability in higher education institutions in Malaysia, held by Ideas here today.

Her concern was echoed by DAP’s Ong Kian Ming, who said not all public universities were capable of coming up with non-government revenue.

This was one of the reasons the government’s decision to slash funding to 20 public universities had not gone down well with the public, the Serdang MP added.

“The budget cuts to IPTAs were done in a very sudden and haphazard fashion. They were not prepared to significantly increase non-government revenue sources,” he said, using the Malay acronym for public institutions of higher learning.

“This can potentially result in the IPTAs losing sight of their primary purposes which are education-related, teaching and research,” said Ong, who is also general manager of Penang Institute’s KL branch, another think tank.

Ong said although the government had boasted about the universities’ success in generating their own funds after the budget cuts announced last year, the truth was quite the opposite.

Ong said Higher Education Minister Idris Jusoh had claimed earlier last month that despite the 9.3% cut to the ministry’s budget, public universities had managed to generate between 12% and 30% of their operational expenditure.

This gave the impression that as the government allocations got cut, the percentage of non-government revenue sources had automatically increased, said Ong.

But when looking at the overall amount, the numbers were still low, especially when compared to the cuts in government allocation, he added.

Ong gave the example of Sultan Idris Education University’s sources for its grants, comparing the amounts for 2014 and 2015.

This showed that in 2014, when government funding amounted to over RM9 million, the combined funding from the corporate sector and international sources totalled just over RM31,000.

In 2015, government funding was slashed by almost half, to RM4.7 million.

But funding from the corporate sector and international sources only amounted to around RM133,000 — a small sum compared with the reduction in funds due to cuts from the government’s side.

Because of this, the pressure on public universities to raise funds by increasing the amount of endowments made to them, among others, was much higher now, he said.

Idris had said the budget cuts to his ministry were in line with efforts to reduce the 70%-90% dependence of public universities on the government.

He said it was time for universities to maximise the use of their assets.

A total of RM250 million was allocated to the higher education ministry in the 2017 Budget, tabled in October last year. -FMT