7/1/2011
1
FUNDING MECHANISM
FOR HIGHER
EDUCATION
DR. S. SOHAIL H. NAQVI
EXECUTIVE DIRECTOR
HIGHER EDUCATION COMMISSION
PAKISTAN
OUTLINE OF
PRESENTATION
National Financial Governance
Higher Education Commission
Higher Education Strategy
Recurrent Funding
Development Funding
University Autonomy
Conclusions
7/1/2011
2
NATIONAL
GOVERNANCE
President
Chancellor of All Federal Universities
Head of Government
Prime Minister
Chief Executive of the Government
Controlling Authority of Higher Education Commission
• Appoints Chairman & 10 HEC Members
Ministry of Finance
• Approval of Annual Budget, Financial Rules & Pay Structure
• Release of Funding on Quarterly / Monthly Basis
• Planning Commission
• Approval of Development Projects & Funding Portfolio
• Monitoring of Development Projects
FINANCIAL OUTLAY
SYSTEM
2 Main Budgets
Recurring (Operational) & Development
February April: Budget Negotiation
June: Budget
Salary Increase of Govt. Scale Employees
Quarterly Fund Provision
20% + 20% + 30% + 30% ??
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FINANCING HIGHER
EDUCATION
Where do we want to go ?
Need Goals & Targets and a Strategy to
get there
Prioritize Intervention
Focus on CAPACITY Development First
HIGHER EDUCATION
REFORMS IN PAKISTAN
• Reform Report (Dec. 2001)
• Key Recommendation: Create HECTask Force on Higher Education (Apr. 2001)
• Steering Committee on Higher Education
• Report & HEC Law (Sep. 2002)
Implementation of Recommendations
• Double financial allocation in 2 Years
• New pay structure for faculty members linking performance & reward
Decisions by the President (Aug 2002)
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4
HEC MISSION
“To Facilitate Institutions of
Higher Learning to serve as
an Engine of Socio-Economic
Development of Pakistan”
KEY CHALLENGES IN
HIGHER EDUCATION
Quality
• Standard of Education, Faculty & Research
Access
• Enrollment in higher education
Relevance
• Addressing the needs for Socio-Economic Development of Pakistan
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HIGHER EDUCATION
ECO-SYSTEM
Campus
Buildings, laboratories, student services, housing
Faculty
Appointment standards & processes, faculty development
Students
Counseling, student life, placement
Academics
Curriculum with relevance, program structure, program diversity, learning
innovation, qualification framework
Quality Assurance
Statistics, Accreditation System & Processes, International benchmarking
HIGHER EDUCATION
ECO-SYSTEM
Research
Grants, Publication, Innovation, Commercialization
Funding
Diversification, Financial Aid, Office of Development
Administration
HR, Financial Management, Procurement, Business Processes
Information
PERN, Digital Library, Video-Conferencing, Triple-Play Communication
Community & Industry Linkage
Relevance, Outreach, Economic Development
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STRATEGIC AIMS:
RESPONDING TO
CHALLENGES
11
Good Governance & Management
Quality Assurance: Standards, Assessment, Accreditation
Faculty
Development
Improving
Access &
Learning
Excellence in
Research
Relevance to
National
Priorities
Co
reS
up
po
rt
Infrastructure Development: Physical, Technology
UGC
1947-2002
HEC
2002-2011
Number of Universities
ranked in top 600
Universities of the World 0 5
New Institutions
Established 71 66
Enrollment 276,274 803,507
Number of PhD
Scholarships
Less than
1,500
More than
8,000
Total PhD Output 3321 3658
HEC IMPACT AT A
GLANCE
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HE ENROLLMENT
SN Description FY11 FY12 FY13
1 Public University 385,000 423,500 465,850 Growth Rate 1.1 1.1 1.1
2 Private University 144,719 162,085 181,535
Growth Rate 1.12 1.12 1.12
3 Distance Education 418,549 464,590 515,695 Growth Rate 1.11 1.11 1.11
4 Colleges 385,547 397,113 409,027 Growth Rate 1.03 1.03 1.03
5 Privately Enrolled 481,587 520,114 561,723 Growth Rate 1.08 1.08 1.08
6 Total Students 1,815,402 1,967,402 2,133,829
Population Aged 17-23 Years 23,183,510 23,677,319 24,181,646
Percentage Enrolled 7.83% 8.31% 8.82%
HEC MANDATE
Financing:
Submit to the Federal Govt. the financial requirement for recurring and development needs to public sector higher education institutions in Pakistan
Approve funds for the institutions out of bulk grants received from federal govt.
Promotion of Research & Development
Quality Assurance
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RECURRENT FUNDING
OF HIGHER EDUCATION
Funding of Universities / Institutes / Centers
(91%)
Univ. Funding Formula Based
HEC Controlled Funding
HEC Secretariat (1.6%)
Inter University Academic Activities (3.7%)
Promotion of Research (3.7%)
FORMULAE BASED
FUNDING OBJECTIVES:
Aligning resource allocation
with national needs
Changing historical highly
Skewed graduate/PhD output
(ignorant of national needs)
Creating enabling
environment for investment
Incentivize quality
enhancement
Increase PhD faculty
Implement Quality standards
Incentivize Enrollment
Increase
Strengthen needs based
scholarship (through FAOs)
Improved student facilitation
(new initiatives like
PERN,CMS)
Transparent fund allocation
Predictability
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ANNUAL RECURRING
FUNDING:
Need and Performance Basis
through Formulae:
Base Grant 65%
Need Grant 20%
Performance Grant 15%
BASE GRANT (65%)
Enrollment Based
Arts, Hum.
Social Sci.SCI & AGRI
Engineering
Medical/
Overall
Weightings 1 2 3
Level-wise Weightings
Undergraduate 1 2 3
MS / M Phil
Studies1.5 3 4.5
PhD Studies 3 6 9
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Factors% age
AllocationImpact of completed development
projects8%
Implementation of New Initiatives 4%
Regional / Location backwardness 5%
Income disparity compensation 3%
NEED GRANT (20%)
Factors %age
PhD Faculty 8%
Research Publication Output 2%
Competitive Research Grants
obtained2%
Quality Enhancement Cell Reports 1%
Compliance with Commission's
Policies1%
Evaluation by professional bodies
at national / international level1%
PERFORMANCE
GRANT (15%)
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RECURRING BUDGET OF PUBLIC
SECTOR INSTITUTIONS (RS. IN
BILLION)
2001-02
2002-03
2003-04
2004-05
2005-06
2006-07
2007-08
Federal Grant 2.947 3.486 5.230 6.996 10.493 14.332 12.536
Own Sources 3.140 3.627 4.515 5.446 7.542 8.036 10.557
TotalBudget
6.087 7.113 9.745 12.442 18.035 22.368 23.093
%age of Govt. Grant in Total Budget 48.4% 49.0% 53.7% 56.2% 58.2% 64.1% 54.3%
0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
60.0%
70.0%
-
5.000
10.000
15.000
20.000
25.000
HEC MANAGED
RECURRING GRANT
PROGRAMS
Promotion of Research
Research Grant Program
Travel Grants
Support for Journals
6 Month Foreign Scholarships for PhD Students
Inter University Academic Programs
Tenure Track System
Digital Library
Pakistan Education & Research Network
Quality Assurance
Learning Innovation
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DEVELOPMENT
FUNDING
HEC Operated Programs
Scholarships
Quality Assurance
Learning Innovation
Curriculum
PERN
HEC Initiated – University Run Programs
University IT Infrastructure
Student Service Center
Foreign Faculty Housing
Student Housing
University Development Programs
Kohat University of Science & Technology
Central Library Video Conferencing Room Cluster Room
Girls Hostel 250 Students Girls Hostel 200 Students Student Service Centre
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Date Palm Research Institute
Shah Abdul Latif University, Khairpur
Institute
Established
in 2004
EXPENDITURE ON
HIGHER EDUCATION
Indicator FY 06 FY 07 FY 08 FY 09 FY 10
Total HE Expenditure 21,743 28,632 27,926 32,183 32,750
Recurrenat Expenditure 10,543 14,332 12,536 15,766 21,500
Percentage of Total 48 50 45 49 66
Development Expenditure 10,891 14,409 15,390 16,417 11,250
Percentage of Total50 50 55 51 34
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EXPECTATIONS FROM THE
MODERN UNIVERSITY
Universities Building
Economies
Universities Building
Leadership
Universities Building
Communities
Socio-Economic Development of Country
RECURRING EXPENDITURE
PROJECTION
Description FY11 FY12 FY13 FY14 FY15 FY16
Total Estd. Budget
for Univ/DAIs (Bill 47.17 53.37 61.72 71.86 83.17 96.90
Core Programs &
HEC Sectt.4.09 5.25 6.44 7.55 8.48 9.68
Total Rec.
Expenditure51.26 58.62 68.16 79.41 91.64 106.58
Univ. Fee & Other
Income22.20 25.75 29.87 34.65 40.20 46.63
Govt. Rec. Grant
(Rs. In Billions)29.06 32.87 38.29 44.76 51.45 59.95
Income
Expenditure
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UNIVERSITY
AUTONOMY
There is more to autonomy than academic autonomy
Financial Autonomy is key
Need to Raise Funds
Establishes Community Ownership
Allows control of one’s destiny
Sources
Fees (The power of mulitiplication)
Alumni
Community
Research Commecialization
Pay Attention to Financial Rules
IMSCIENCES: A
SUCCESS STORY
Located on border of Tribal Area in Peshawar
Co Education with full freedom to women
Funded only 20% By the Government
Fastest Growing High Quality Business School
Charges Market Rate Fees
Scholarships for Poor Students
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INST. OF MANAGEMENT SCI.
PESHAWAR
CONCLUSION
Must know where you are going
Build your own capacity
Be Fair, Open & Transparent
Communicate (Market?) Success
Real – time Adaptation Required
Success is possible in EVERY Scenario