Universities face drastic cuts and tuition fees

Finland’s universities are facing drastic cuts and the introduction of tuition fees for international students following the new government’s announcement of severe austerity measures that will involve lopping €4.5 billion (US$5 billion) off public spending by 2019.

Overall, approximately €500 million (US$556 million) will be cut from higher education institutions. The government intends to freeze the university index, cut research funding from the Academy of Finland and Tekes – the Finnish Funding Agency for Innovation – and discontinue the compensation paid for pharmacy services to the University of Helsinki and the University of Eastern Finland.

According to a government statement on its programme on 27 May, tuition fees will be introduced for non-European Union and non-European Economic Area, or non-EEA, students. Those who have completed their studies will be encouraged to stay and work in Finland, with, for example, a possible tax deduction.

Yle Uutiset, the Finnish news broadcaster, asked Prime Minister Juha Sipilä how the cuts could be justified given an election promise to protect the education budget.

“I said that education would be reformed and properly,” said Sipilä. “We need to make savings to enable long-term structural reforms.”

Sanni Grahn-Laasonen, the new education minister, said: “Education cuts are painful and nobody would have hoped for them.

“The most important thing is how you make the cuts, so that you achieve as much savings as possible through structural reforms so as to guarantee the quality of teaching and research,” she added.

Cuts pose ‘a threat’

But Jukka Kola, rector of the University of Helsinki, said the cuts pose a serious threat to the quality of research and teaching, and consequently to our national success and competitiveness.

“The steps proposed by the [in]coming government are at odds with its goals. The government wants to make Finland a leading country in education and to increase both the quality and impact of research. The drastic cuts proposed to education would have the complete opposite effect,” he said.

Sipilä’s government – a coalition of his Centre Party, the right-wing Euro-sceptic Finns Party and the conservative National Coalition Party – came into power following the general election in April.

The previous government of the National Coalition Party cut funding to institutions of higher education by €200 million (US$222 million).

Consequently, the University of Helsinki has had to reduce its staff by 500 employees through retirement and choosing to leave open positions unfilled.

Kola said the cuts seem to be targeting the University of Helsinki with particular intensity, even though it is the only Finnish university to rank among the top 100 universities worldwide.

By 2020, the university will face cuts amounting to €100 million, with €13 million of that due to decisions made by the previous government but taking effect in 2016. This will mean a cut in the university’s basic funding by one sixth.

Tuition fees

Professor Riitta Pyykkö, Chair of the Finnish Higher Education Evaluation Council, or FINHEEC, told University World News that it is not clear whether the new government will continue with plans to charge tuition fees for non-EU and non-EEA students, as presented to parliament under the previous administration.

“The big question for universities is: will the formulation be that universities ‘should’ start to collect fees in all programmes, or will it be that they ‘can’ collect fees,” Pyykkö said. “Although the rectors are mostly supporting the initiative, they would like to see it as a part of university autonomy, not an obligation.”

The Union of Students in Finnish Universities of Applied Sciences, or SAMOK, and the National Union of University Students in Finland, SYL, are disappointed by the proposed tuition fees.

SAMOK and SYL are demanding to know why the government wants to reduce a well-functioning source of work-based immigration, since half of all the students who remain in Finland after completing their degree get a job. From an immigration policy perspective the priority should be to focus on employing and integrating the other half, they argue.

Iiris Niinikoski, SYL’s vice-president, said: “Can we really afford not to let in potential tax payers? Free education is a sensible investment for achieving an international, open and safe Finland. Please see sense!”

Economic situation

The cuts should be seen in the context of Finland’s economic situation. The country has relatively high unemployment and a deepening trade deficit partly due to a decline in exports to Russia, and the new government intends to increase military spending, due to increasing "Cold War tension" in the region.

Finland’s economy has failed to recover from a multitude of shocks in the last seven years. Nokia went from being the world’s biggest maker of mobile phones to making none, and the paper industry, Europe’s biggest, suffered as readers abandoned newspapers for the Web.

Government forecasts that economic growth would fix public finances proved unfounded. Finland has the fastest-aging population in Europe.

Finnish universities have experienced extensive reforms through mergers and a decoupling from the state, meaning that university staff are no longer government employees.

They now feel betrayed by the government. Having loyally worked for greater autonomy, a diversified funding base and having actively competed for international research funding, they are now seeing the government budgets being significantly reduced through the austerity package.

Rector Kola agrees with the new government that universities should increase their collaboration and specialise in their fields of strength.

“The proposed cuts are so major that universities cannot survive them just by shaving off costs. Hard decisions will have to be made. However, structural changes take time and cannot be implemented in the schedule necessitated by the cuts. The structural changes will have to be made based on a quality assessment of the universities,” he said.

“But the cuts should be targeted so that they do not erode our future,” he said.