Higher education funding cuts

Updated Dec 13 2019

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The writer is a senior research fellow at the Institute of Development and Economic Alternatives, and an associate professor of economics at Lums.
The writer is a senior research fellow at the Institute of Development and Economic Alternatives, and an associate professor of economics at Lums.

‘A UNIVERSITY in every district’, increasing the percentage of youth going to tertiary education from 6-7 to 15-odd per cent (ie 100pc increase), improving the quality of higher education, providing more ‘relevant’ higher education, providing more advanced vocational skills, making breakthroughs in information technology. These have all been touted as government goals and priorities in the last few years. Even today, ask any government official if higher education is a priority and the answer would inevitably be ‘yes’.

Read: HEC chairman urges govt to save higher education from crisis

But, at the same time, the government has cut the higher education budget substantially this year. Allocations for recurrent expenditures of universities have been reduced by a good 15-20pc compared to last year. It is a lot less than what the Higher Education Commission had asked for to allow for proposed expansions. The cuts in development expenditures are even deeper. A significant portion of funds that could have lessened the impact of HEC cuts have been allocated to Dr Atta-ur-Rehman for special initiatives. It is not clear what these initiatives are and how they will contribute to higher education and/or the country’s development needs, but it seems Dr Atta-ur-Rehman’s access to higher authorities has led to this split, at the cost of money for the HEC and public-sector higher education.

How do we square the government’s aim to expand and improve higher education with significant reductions in resources for higher education? We are going through a financial crunch where, as part of its coping strategy and IMF commitments, the government has enforced an ‘austerity’ policy on all public departments. Are HEC cuts just a part of this austerity plan? As the economy stabilises and moves towards a growth path (which all hope will happen soon), will the resources be increased again? In other words, is this a short-term setback that will go away in a couple of years?

If higher education is a priority, why impose a cut on higher education? The government always has leeway, even under austerity, to decide which sector would bear how much of the burden of austerity. And even if austerity had to come, why split the money for higher education between regular university needs and speculative projects outside the HEC’s control?

Students dropping out of university today are not likely to return to their education tomorrow.

The need for austerity might not go away as quickly as some expect. We are starting to see signs of stability in some of our macroeconomic variables, but the path to sustained growth is going to take time. We also have significant accumulated loans that will have to be serviced and paid off over the next few years. This might mean that, even if growth comes back — which is a big ‘if’ — we still might not have a lot of fiscal space to raise expenditures quickly and to levels that will allow public universities to come up in all districts and to double the number of students that access higher education.

Even if we get more fiscal space and the government decides to use this to expand higher education, the hysteresis effect of the changes that austerity brings with it will have an impact on subsequent expansion. Universities have had to raise fees, stop new programmes, and cut back on hiring new faculty and staff. Students who drop out today or are unable to join due to cutbacks and/or fee hikes are not likely to return to education a couple of years later.

There is a deeper issue here as well. What is higher education for? Why does the government subsidise higher education? There are a certain number of people we need in various specialisations (eg, engineers, doctors, lawyers, computer experts, etc) to ensure smooth functioning and growth in the economy. If the private sector cannot produce them, the state has an interest in subsidising education in these areas to ensure sufficient supply of human resources. This is definitely an explicitly stated reason for funding higher education in Pakistan.

If the above is the only reason for subsidising higher education then, given the unemployment rates in the graduate population, a squeeze on higher education is not problematic from the point of view of the state, even if it still contradicts the stated aim of the government to expand access to higher education. Changing stated aims might be politically costly, so the government might as well live with the contradiction of continuing to express its goals to expand access while simultaneously reducing and keeping funding low.

But there are other issues at stake too. Access to higher education has strong links to social and economic mobility. The government has repeatedly said that it aims to create a society based on merit and equal opportunity for all. If this is the case, a squeeze on funding for public universities directly contradicts these aims. The rich can always attend private universities in Pakistan or abroad. It is those coming from more constrained economic circumstances that depend more on state subsidies in order to access higher education. Higher education funding cuts hit these individuals directly.

There is also a gender angle to this story. There are strong links between education and employment of women with many other important variables like health, health outcomes for the next generation, income, wealth and many others. Funding cuts will deprive us of these benefits as well.

Funding cuts to higher education is not a simple issue and should not be treated as such. It plays havoc not only with societal goals but with the lives and life chances of millions. This government has not only cut public higher education funding, it has also allocated some of the remainder for non-mainstream projects. A deeper debate on the issue is warranted.

The writer is a senior research fellow at the Institute of Development and Economic Alternatives, and an associate professor of economics at Lums.

Published in Dawn, December 13th, 2019