ASIA: Can the private sector boost participation?

Governments in many developed countries such as Australia, the US and the UK initiated public management reforms in the 1980s. One of the most significant and specific concerns of the reforms has been to introduce private sector practices in the public sector. The primary aim is to help governments achieve their goals more efficiently, economically and effectively. Education has been one of the key issues on the policy agendas of these governments. Could the private sector help boost Hong Kong's participation rates in higher education?

The last decade has seen intensive efforts in Hong Kong to increase participation rates. Following a review in 1999, it was suggested that the Hong Kong government's target of providing 60% of senior secondary students with the opportunity to pursue higher education was feasible.

Self-financed programmes with government support for start-up loans were deemed an appropriate means of achieving this target. Since 2001, most local educational institutions have started to offer associate degree programmes that focus on imparting general knowledge to students.

In contrast higher diploma programmes, offered since the colonial era, focus on equipping students with knowledge in specific and professional areas; these programmes can be regarded as vocational education to some extent.

In 2001, the financial committee of the legislative council approved a package of support measures to facilitate a progressive expansion of self-financing post-secondary programmes. One of the measures was to offer a loan scheme to post-secondary education providers to support their initial start-up costs.

The loans could be used for purchasing, renting or building campuses for the provision of post-secondary programmes. At the end of 2009, a total of 23 loans amounting to over HK$4 billion were approved for 14 institutions. According to the Progress Report on Education Reform No 4, five tracts of land were also allocated.

Educational institutions responded enthusiastically to the policy objective. The total supply of places offering self-financing sub-degree programmes increased nearly 10-fold during the academic years 2000-01 to 2006-07. At the same time, there has been enthusiastic demand for sub-degree education, as evidenced by high enrolments.

As a result, the 'participation rate', which reflects the availability of educational opportunities to the 17 to 20 year age cohort, has doubled in a few years from 33% to 66%. After a period of robust development, the self-financing sub-degree sector entered into a period of consolidation starting from the 2005-06 academic year, with the number of course providers stabilising at 20 and the participation rate maintained at slightly above 60%.

Since the 2004-05 academic year, the participation rate of post-secondary education in Hong Kong has been consistently over 50%. This can be regarded as the post-massification of higher education. The self-financing sub-degree sector has expanded exponentially.

However, the number of publicly-funded bachelor degrees was maintained at around 14,500. It is argued that the elitism of publicly-funded degrees is reinforced as these degree places are always allocated to the top secondary students of the year; that is, those who obtain the highest examination scores. This generally creates a public perception that self-financing programmes are offered as a second choice to students.

How can the numbers taking full degrees be boosted? Some of the key issues that need addressing to increase higher education participation in Hong Kong include the quality of education offered, educated employability levels and the ability of people doing associate degrees to trade up to full degrees (articulation).


According to a survey conducted by the Joint Quality Review Committee (2009), around 50% of sub-degree graduates in the years 2005 and 2006 pursued further studies full-time. Other graduates were mainly employed and-or studied part-time.

Among the sub-degree graduates pursuing full-time studies, around 30% articulated to publicly funded programmes (or around 15% of all sub-degree graduates). Other graduates were enrolled in self-financed programmes offered by local universities, co-organised by local and overseas institutions, or studied abroad.

In recent years, the lack of sufficient degree programmes for the articulation of sub-degree graduates has been criticised as this indicates that the needs of graduates are not being fully met. Some attempts have been made to address this with varying degrees of success.

Proliferation of private universities is regarded as one of the possible ways to address the challenge. Since the early 2000s, the government has shown a willingness to embrace the concept of privatising higher educational institutions on the basis of a well-established quality system.

The Secretary for Education recognised that private universities have the potential to be developed in Hong Kong. Self-financed educational institutions, particularly the continuing education arms of publicly funded local universities, have demonstrated an interest in establishing private universities.

In February 2010, the finance committee of the legislative council approved an increase of HK$2,000 million in a commitment towards providing start-up loans to post-secondary education providers. Five additional land sites have also been earmarked for the development of college premises under the land grant scheme. These aim to facilitate the development of degree-awarding institutions that offer top-up degree programmes.


The reform proposal has been criticised on the grounds that it emphasises quantity rather than the quality of education. Indeed, it is acknowledged that the number of high quality university graduates has been decreasing as compared to the 1970s to 1990s.

An editorial in a local newspaper suggested that university graduates are similar to red wine. Year of graduation and vintage are important attributes that reflect the quality of both graduates and red wine. It is recognised that graduates from before the 1990s are highly talented and intelligent. They have always demonstrated the potential to become leaders of society and receive good returns from their jobs.

In 2007, the Hong Kong media revealed that educational institutions have been admitting students who do not fulfill the entry requirements into associate degree programmes. This generated public concern around the quality of the programmes and the graduates.

Evaluations of improvements in the quality of higher education are based on learning outcomes and their assessment. Since 2001, the government has developed a set of common descriptors for sub-degree programmes, and these descriptors were further revised in 2009. Sub-degree graduates are expected to possess the knowledge, skills and abilities stipulated in the learning outcomes under the descriptors. Two key learning outcomes are:

1. A solid foundation of generic skills, including languages, IT, interpersonal, communication, quantitative and analytical skills, as well as the ability to learn how to learn.
2. A broad theoretical understanding of the chosen discipline and its application.

One of the common means of assessing graduates' achievements in terms of learning outcomes is the employment survey.

The survey results for sub-degree graduates indicated that their performance improved from 2000 to 2003. However, it dropped in 2006. The sub-degree programmes offered in Hong Kong are mainly two years in duration. This means that the graduates were admitted in the academic year 2004-05, when the participation rate in post-secondary education reached over 50%.

In addition, the results for the 2006 graduates covered both publicly-funded and self-financed programmes, while the results for 2000 and 2003 covered only publicly-funded programmes. This implies that the drop in graduates' performance may be due to the expansion of the self-financed sub-degree sector.

The government maintained the number of places for publicly-funded degree programmes at around 14,500 in the 2000s. This preserved the elitism of publicly-funded degree programmes. Comparing the results of the employer survey between sub-degree graduates and publicly-funded degree graduates, the degree graduates probably improved to a greater extent through these years.


Higher educational attainment leads to higher employability. However, educated unemployment is a common phenomenon in developing countries. Educated unemployment or underemployment is due to a mismatch between the aspirations of graduates and the employment opportunities available to them.

The government's economic report states that the higher the educational attainment, the lower the unemployment was between 1997 and 2010. A study on the post-1980s generation by the government's Central Policy Unit found that the unemployment rate among the cohort of people born between 1980 and 1989 was significantly higher than earlier birth cohorts. The birth cohort of 1980-89 pursued higher education in the late 1990s and 2000s.

In addition, the unemployment rate for sub-degree graduates is increasing rapidly among the younger generation. Indeed, the unemployment rate among sub-degree graduates in the birth cohort of 1980-89 is higher than other groups with lower educational attainments. This indicates the potential problems of unemployability that may be caused by the expansion of the sub-degree sector in Hong Kong.


The higher education sector in Hong Kong was reformed in the 21st century, and within a period of five years the post-secondary participation rate for the 17 to 20 year age group doubled to 66%. This ushered the higher education sector in Hong Kong into a post-massification era.

The expansion of higher education aims to equip society with the ability to cope with the challenges of a knowledge-based economy. Other motives of the government include unemployment among youth in the late 1990s and ideological change in political leadership. This policy has drawn repeated criticism because of the quality of self-financed sub-degree programmes.

Lack of articulation opportunities, the quality of education and educated unemployment are the key challenges ahead.

* Calvin Wan is at The Hong Kong Polytechnic University.

** This is an abridged version of his article "Reforming Higher Education in Hong Kong Towards Post-massification: The first decade and challenges ahead", published in the most recent edition of the Journal of Higher Education Policy and Management. It is republished with permission. For the full article click here