Critical Success Factors in. Planning: An Institutional Perspective. Prof. Yunus D. Mgaya PhD Deputy Vice Chancellor (Administration)

Transcription

1 Critical Success Factors in Higher Education Finance and Planning: An Institutional Perspective Prof. Yunus D. Mgaya PhD Deputy Vice Chancellor (Administration) University i of Dar es Salaam

2 Introduction Since its inception in 1961 higher education in Tanzania has undergone massive expansion, with a major expansion in student enrolment taking place over the last decade. d Enrolment HEIs in Tanzania stood at 117,057 in 2009/10; 13 students were enrolled in The country projection in the Vision 2025 is to have 360,000 students enrolled in HEIs as a lower bound by 2025.

3 Introduction Cont d Despite this massive expansion, funding for public Higher Education Institutions (HEI) in Tanzania has continued to come mainly from the government. This is largely l due to weak mechanisms of harnessing resources from non-state actors.

4 Introduction Cont d The changing socio-economic and political climate in the country has led to a progressive decline in the flow of resources from the government to public institutions. This has necessitated institutions to diversify sources of financing the planned activities.

5 Introduction Cont d Although, over 90 percent of the costs of running higher education in Tanzania (and in the region) are borne by the state, the trend shows that there is a perpetual under-funding of the education sector higher h education sub-sector, in particular. As a measure to increase enrollment with the dwindling government budget allocated to education sector, in the early 1980s, Tanzania started to admit students on a fee paying basis, focusing mainly on foreign and institutionally supported students.

6 Introduction Cont d Following the structural adjustment programme adopted d by TZ in the late 1980s and early 1992 cost sharing was introduced. d Under cost sharing students (and families) became responsible for paying for their own transportation, application, registration, entry examination and student union fees as well as caution money.

7 Introduction Cont d From July 2005 the government of Tanzania introduced student loans system following establishment of the Higher Education Students Loans Board (HESLB) by Act No. 9 of HESLB covers tuition fees, other academic fees, room and board for all higher education students whether government or privately sponsored in the public universities or self paying in the private universities.

8 Introduction Cont d This student loan policy dramatically changed the country s tuition policy, moving it from a dual track policy to one in which h all students must pay tuition, albeit deferred as a loan to be repaid once they have finished their studies. The loan policy allows a student to borrow money (interest free) through a means-tested procedure. The higher h education financing i underlies three overarching themes of the university policy: Quality, and the relationship between funding and quality in any of its several dimensions;

9 Introduction Cont d Access, or the search for social equity in who benefits from, and who pays for, higher education; and Efficiency, or the search for a cost-effective relationship between revenues (particularly those that come from students, parents, and the government) and outputs (whether measured in enrollments, graduates, student learning, or the scholarly activity of the academic members).

10 Sources and Trends of Financing in Higher Learning Institutions in Tanzania Sources: Direct government subvention [Personnel Emoluments, Other Charges and Development Expenditure] to all public universities and colleges; Direct bilateral l and multilateral t l donor funding for specific programmes and projects; Direct local l funding from institutions such as Tanzania Education Authority, etc;

11 Sources and Trends of Financing in Higher Learning Institutions in Tanzania Cont d Student financial assistance in the form of scholarships and a loan system for students enrolled in universities and colleges; and Self generated funds by institutions through tuition fees, contract research and consultancy.

12 Sources and Trends of Financing in Higher Learning Institutions in Tanzania Cont d Trends Prior to 1980s the higher h education sub sector was a one-tier system with only public owned institutions. However, as a result of economic hardship of 1980s and the implementation of the WB/IMF driven SAPs in mid-1980s there was more engagement of the private sector in the provision of higher education in the country. Currently there are 11 public universities and university colleges and more than 19 private universities and colleges in Tanzania.

13 Sources and Trends of Financing in Higher Learning Institutions in Tanzania Cont d About 75 percent of the candidates are enrolled in public universities. Financing of higher education through public funds encompasses both public and private institutions through the provision of a meanstested, interest free loan to students. This arrangement has led to increased access to higher education by more students.

14 Direct government subvention Figure 1 shows the total government disbursement to some of the Higher learning institution for the period 2008 to UDSM has been receiving the largest share of the total allocation. There has been a significant increase in government subvention to almost all the public universities.

15 Direct government subvention Cont d Figure 1: Distribution of disbursement for the period 2008 to 2010 to HEI 45,000,000,000 40,000,000,000 35,000,000,000 30,000,000,000 25,000,000,000 20,000,000,000 15,000,000,000 10,000,000,000 5,000,000,000 Total Disbursement 2008 Total Disbursement 2009 Total Disbursement 2010

16 Direct government subvention Cont d It is noted from Figure 2 that almost all universities have registered a significant increase in the enrollment with the UDSM and the relatively new University of Dodoma (UDOM) taking the lead. This reflects the government resolve to increase the enrollment at the higher h learning institutions.

17 Direct government subvention Cont d Figure 2: Distribution of the number of students enrolled in the public HEI for the period 2007 to ,000 9,000 8,000 7,000 6,000 5,000 4,000 3,000 2,000 1,000 Total Enrollment 2007 Total Enrollment 2008 Total Enrollment 2009

18 Direct government subvention Cont d Ideally government subvention ought to be related to the volume of activities within institutions. However, in practice this has not been the case. UDSM has been receiving relatively small amount of funds from the government compared dto other Higher Learning Institutions as depicted in Figure 3.

19 Direct government subvention Cont d Figure 3: Per Capita disbursement to HEI for the period 2006 to ,000,000 20,000,000 15,000,000 10,000,000 5,000,000 0 Per capita Disbursement 2006 Per capita Disbursement 2008 Per capita Disbursement 2009

20 Direct government subvention Cont d What is observed shows us that whatever higher education financing strategy is developed, a fundamental reality acknowledged is that the level of government financial support for higher education is not currently sufficient i to ensure the financial i sustainability of the system as it currently exists. Therefore, reforms in financing of higher education shall still target largely public funds but in ways that encourage institutions to be competitive and improve institutional performance.

21 International Donor Support For many years international donor support has assisted the development of higher education in Tanzania. Many of the buildings and infrastructure in pioneer higher education institutions have been erected through direct and indirect donor financial support. Similarly many institutional programmes and projects are supported by international donors.

22 International Donor Support Cont d For many years now the UDSM has been receiving support from the Royal Norwegian Government, Carnegie Corporation of New York, Rockefeller Foundation, Sida-SAREC, Ford Foundation, World Bank, DANIDA, etc. UDSM like many other HEI in Tanzania are aware that the external donors role can only be strategic and for a defined period. This kind of funding is often competitive and institutions have to prepare proposals and argue a strong case for funding.

23 Self Generated Funds Internally generated funds as a source of financing of higher education include: private tuition fees, business profits, investment incomes net revenues from contract research, teaching and consultancy, joint venture endeavours, fund raising in support of both academic and administrative functions, etc.

24 Self Generated Funds Cont d The University of Dar es Salaam has been meeting more than 80% of the operational expenses from internally generated funds. This is an area that needs to be strengthened further, more so given that the Government subvention has been declining year by year despite the increase in enrollments.

25 Private Sector Financial Support The Government is faced with a challenge to expand the resource envelope for funding public expenditure, hence innovative approaches ought to be sought. Experiences from other countries with respect to financing HE show that government revenue could be increased significantly through efficient or increased targeted taxation. Examples of targeted taxation include graduate tax, education levy and special telecoms education levy.

26 Private Sector Financial Support Cont d Graduate tax Graduate Tax may be collected as specific tax intended to improve higher education in Tanzania. This may be collected from all Tanzanian employees who are in the public and non-public sectors employment.

27 Private Sector Financial Support Cont d Education levy Ought to be paid out by private sector that directly benefit from the manpower from the HEIs. It is rightly assumed that, t in one way or another, private sector benefit from the product of HEIs either now or in future.

28 Private Sector Financial Support Cont d Telecommunications levy It could be charged at monthly nominal rate on subscribers of mobile phones; can be tolerated but yield a substantial sum of money that could augment higher education financing funds. For example, at the current subscription levels, collectable funds range from TAS 19.2 billion annually at a nominal rate of TAS 100 per subscriber to TAS 96.3 billion at a rate of TAS 500 per month.

29 Private Sector Financial Support Cont d Philanthropy UDSM has established an Advancement Office which is charged with searching for funds from individuals and corporate organizations within and outside the country. Corporate bodies or individuals (alumni, etc.) have not been a significant source of funding for higher education both at corporate and individual levels. Individual wealth has been rather limited and corporate charitable giving has not been encouraged.

30 Private Sector Financial Support Cont d It can be confidently stated that with its almost 50 years of existence UDSM can be said to have enough critical mass of Alumni both within and outside the country. We need to reach out and mobilize resources through activities of the Advancement Office. Though private sector is an important component of financing higher education, this is an area which the University of Dar es Salaam in particular has not tapped to optimal level given her long existence.

31 End of Presentation THANK YOU FOR YOUR KIND ATTENTION Thank you for your kind attention.