Show me the money: Financing Higher Education Dr kofi Nkrumah-young ACHEA, 2018 – EMBRACING THE FUTURE: CREATIVE APPROACHES TO HIGHER EDUCATION Hyatt Regency, Port of Spain, Trinidad Show me the money: Financing Higher Education

Matrix of funding strategies Social Engagement Low High Personal Resources Direct Fees Tuition Fees User Fees/ Pay as you go Loan Programmes Employers’ Support Scholarships HEART Tax Education Tax Institutional Subsidy Third Stream Funding - Subsidy Cost cutting Suppressed Salaries Government Funding Subvention Free Education Policy GATE in Trinidad

Main Problems Limitations in resources – hinderance to Free Education to the tertiary levels Cost containment strategies restrict access - quantity is a function of cost Ex post pricing restricts managerial action and initiative because price is equal to cost - hence HEIs do not benefit from efficiency gain Cross the board subsidy leads to inequity as those in the higher earning categories derive more benefits There are preconditions to funding models - linked to who controls Course offerings Curriculum Development Enrolment numbers Staffing salaries and numbers Wages of graduates

The Caribbean Experience Overwhelming support for public funding of education Desirable to support international norm for free education to secondary level At tertiary level the Caribbean does not satisfy all the conditions Free education Privatisation Income contingent loans The level of central control hinders third stream income at the tertiary level Quality Trap possibility – Ad hoc nature of funding tertiary

Alternatives in the context of Cost Sharing Education Development Insurance Fund (McIntyre Report, 1990) National Education Savings Plan (Holness, 2012) Higher Education Participation Scheme (Nkrumah-Young, 2012) Alternatives in the context of Cost Sharing

Education Development Insurance Fund (McIntyre Report, 1990) One time grant from Government, 35% HEART Trust contribution, other grants and balance in SLB Fund - insurance against loans to students and institutions for educational purposes Loans disbursed through special windows from commercial institutions Potential beneficiaries should open accounts with institutions 36 months prior to borrowing

Holness (2012) National Savings Plan Parents set aside amounts in an account for Tertiary education Savings for 18 years Government Matching contribution

Higher Education Participation Scheme (Nkrumah-Young, 2012) Citizens contribute a portion of salary to a fund The contribution repayable with interest after 7 years (similar to the NHT Scheme) Employers make a non-refundable contribution to the scheme Students access the fund for Tuition and other learning expenses Repayment is income contingent and suspended for period of unemployment

References Douglas, L. (2012) Creative Ways Needed to Fund Tertiary Education – Holness. Jamaica Observer, October 12, 2012 Johns, R. L., Morphet, E. L. & Alexander, K. (1983) The Economics of Financing Education. Englewood Cliffs, New Jersey: Prentice-Hall. McIntyre, A. (1990) Report by the Task Force to Minister of Education: Financing Education in Jamaica. Kingston: Ministry of Education Nkrumah-Young, K (2010) Reforming Higher Education in the Caribbean: Implications for Administrators Journal of Education and Development in the Caribbean Vol.12, No.1, Nkrumah-Young, K. (2015) The Quality/Financing Conundrum in Caribbean Higher Education in Quality in Higher Education in the Caribbean, Anna Perkins (ed) (2015) Kingston, Jamaica: UWI Press ISBN:978-976-640-512-0 Nkrumah-Young, K., Huisman, J. & Powell, P. (2010) The Impact of Funding in Higher Education in Jamaica in Education in Small States: Global Imperatives, Regional Initiatives and Local Dilemmas (2010) Mayo, P. (ed.). ISBN: 978-0-415-56039-9 UK: Routledge Psacharopoulus, G. & Patrinous, H. A. (2002) Returns to Investment in Education. The World Bank. Latin America and the Caribbean Region Education Sector Unit. Available at: https://openknowledge.worldbank.org/bitstream/handle/10986/19231/multi0page.pdf?sequence=1&isAllowed=y Sherlock, P. M (1986) Report of the Task Force on Tertiary Education. Kingston: Ministry of Education. Sherlock, P. M. (1991) Restructuring Tertiary Education in Jamaica: Principles and Proposals. Kingston: Ministry of Education. Tsang, M. C (1998) The Financing of Education in Jamaica: Issues and Strategies. Washington: Inter-American Development Bank. Zheng, H. Y. (2002) Returns on Investment in Public Higher Education. Ohio: OAIRP Conference