EUROPE: Effects of financial crisis vary

European universities have been affected in varying ways by the impact of the global financial crisis, with those in some countries expected to suffer cuts and others elsewhere appearing to benefit. The European Universities Association has been seeking details from its 34 national rectors' conferences and the EUA reports that while it is still too early to predict, it is clear that some higher education sectors face difficult times ahead.

A table of the impact on universities in 17 EU countries reveals that institutions in Hungary will have to impose staffing cuts because of a 7% reduction in pubic funding. In Italy and Lithuania, governments have announced 10% reductions in spending which will inevitably impact on universities.

The Polish government likewise has cut its higher education spending by 6% to 7% while in Spain the financial situation for some public universities has worsened following declarations by the presidents of several of the Spanish autonomous regions that big cuts will be made in next year's university budgets.

In Austria, the economic crisis has been used by the government to discard previous promises, made before the last election, to increase its investment in higher education. There have also been cuts in funds for competitive research. Universities hope to convince the government in upcoming negotiations to reinstate some of the promises made before the economic downturn but, whatever the outcome, they expect reductions in private research funding.

The Dutch rectors' conference told the EUA of difficulties rectors were having negotiating with the government for public funding increases although they said no budget cuts had been planned so far. The rectors were especially concerned about sensitive areas in research and innovation where collaboration with the business sector was endangered as companies pulled back from their financial commitments. Rectors called on the government to step in and invest strategically for a limited period, until business is confident enough to renew its cooperation with universities.

Following the publication of the British Research Assessment Exercise results, the UK government announced that funding for teaching in universities would increase by 3.2% and for research by 4.5% in 2009-10.

An EUR71 million Economic Challenge Investment Fund has been established so universities can respond rapidly to the needs of employers and individuals during the crisis. Universities UK has initiated a communication campaign promoting the role of universities in helping business in times of economic downturn.

In Denmark, too, the government will release extra funds for research that had been set aside in 2006. Rectors said universities were now more focused on whether investments by the private sector will decrease in the near future and they are insisting on the need to invest in higher education and research at times of economic downturn.

The Finnish parliament is to vote on new university reform, including governance and financial provisions. Universities will be expected to raise more funds from the private sector, especially from business, which could be difficult during the economic crisis. Government plans include increased investment to lessen effect of the downturn it is not clear whether universities will benefit.

French rectors have not reported any budget cuts to their universities' public funding. On the contrary, the French government is planning significant reforms to the higher education sector, including increased autonomy and an additional public investment of EUR1 billion a year for the next five years. But, for the first time, there has been a decrease in the allocation of civil servants although only a small number have been affected.

German rectors told the EUA they expected increased investment from the federal government in terms of building, maintenance and renovation of facilities. This was confirmed by the announcement of a second stimulus package which includes investment in university infrastructure.

But there are fears universities will receive less than promised - higher education needs a third of the money earmarked for education, or around EUR2.9 million - but cuts might affect future funding schemes to make up for the large amounts that will be spent under the stimulus package. So far there is no indication of how much the economic crisis will affect private funding, which essentially relates to research work.

Chronic under-financing of Greek universities is unlikely to be resolved by the current economic crisis. Despite announcements that the government intends to increase public spending on universities in future, there has been no data on how much will be passed on to higher education institutions.

The EUA said that the results of its monitoring of funding across Europe would feed into its new project European Universities Diversifying Income Streams and into discussions at a EUA convention in Prague next month.