Academics and students say austerity plans won’t work

Yle, the Finnish broadcasting corporation, recently published a survey on “likely or extremely likely threats to Finnish security”. The majority of respondents (54%) were concerned about a “drawn-out economic depression”, far in excess of other concerns: “problems in domestic politics” (28%) and “problems in foreign politics” (22%). Even the “threat of terrorism” (20%), “influx of refugees” (16%) and “extreme weather” (15%) were of relatively minor concern.

The outlook may reflect the fact that the threat of austerity measures has risen to the top of the political agenda following the general election in April. With approximately €500 million (US$563 million) expected to be cut from higher education institutions’ budgets, universities have started to plan for meagre times ahead.

For example, the University of Helsinki board last week began planning for expected cuts of €26 million in 2016, increasing to as much as €100 million by 2020 – although some of that is also being lost from its pharmacies due to statutory changes – and an immediate block on all recruitment of administrative and IT staff has been announced.

As details emerged of where Juha Sipilä’s government will try to make cuts in spending on universities, the Finnish Union of University Professors and the Finnish Union of University Researchers and Teachers issued a joint statement heavily criticising the government’s thinking, saying that the “goals and methods of the government programme are in serious conflict”.

A third semester

The announcement on 27 May of a plan to implement a third semester for universities immediately caused controversy when former prime minister and current Minister of Finance Alexander Stubb joked: “In the past, a professor had three reasons to be a professor – June, July and August. This will no longer be the case in the future.”

But Kaarle Hämeri, chair of the Finnish Union of University Professors, said that for professors and several other groups of university researchers “summer has been the only time that has allowed for an exclusive focus on research”.

Stubb later apologised for his remark, insisting that it had been intended to be funny.

Student financial aid

The government programme includes an initial €70 million – but rising to €150 million in the long run – to student financial aid and a proposal to remove the index-link to inflation. Student organisations calculated that this might mean a 20% cut in the current budget for student financial aid, and that the real value of student financial aid will continue to lag behind actual living costs.

According to a spokesperson for the student organisations: “The government aims to save money, while hoping for shorter study time [to graduation]. The effect of these cuts will be the opposite. The most significant factor slowing students down in their studies is insufficient [support for their] livelihood.”

Niina Jurva, education policy officer of the National Union of University Students in Finland, or SYL, said this would most likely involve “slashing the study grant, decreasing the number of months students are entitled to aid, or cutting the student housing benefit”.

Fees for non-EU students

Another austerity measure being contemplated by the government is that international students from non-European Economic Area, or EEA, countries should start to pay fees.

There are currently around 20,000 non-EEA students at Finnish universities and polytechnics. The risk with such a policy, however, is that it could lead to a huge decline in international student numbers, as occurred in Sweden.

The Union of Students in Finnish Universities of Applied Sciences, or SAMOK, and the National Union of University Students in Finland, or SYL, issued a joint statement protesting against the government’s intention to introduce tuition fees, stating that “international students clearly benefit the country’s national economy”.

As reported in University World News, numbers of international student applicants in Sweden fell from132,000 in 2010 to 15,000 in 2011 after the introduction of tuition fees. However, numbers started to increase again from 2012, and the Finnish government appears to think that such a pattern would be repeated in Finland.

However, university leaders are concerned about how Finland, with reduced university staff and budgets, will attract foreign fee-paying students.

Funding cuts

The fear among universities is that there will not be enough funding to go around. A month before the election, in March, a pro-market think-tank, EVA, suggested that universities reduce the number of departments and encourage specialisation.

A report from the dean of the arts faculty at the University of Helsinki, Arto Mustajoki and the President of Aalto University, Tuula Teeri, called for a greater distinction between bachelor and masters degrees, as well as a review of the automatic right to undertake masters studies.

According to Mustajoki and Teeri, only specific universities should offer masters degrees in the future, and that the bachelor degree should be seen as qualifying graduates for entry to most labour markets.

As Mustajoki told University World News last week, the cuts being faced by universities and major funding body the Academy of Finland could be even higher if certain senior politicians get their way. Prime Minister Sipilä, Finance Minister Stubb, and Foreign Minister Timo Soini do not value high-level research and academia, he said.

Mustajoki said that “universities have already faced cuts during the past five years. The level of funding has increased much less than some costs, especially, salaries”.

But he believes that some jobs and a few degree programmes could be cut, in cooperation with other universities; universities could take in slightly fewer students but ensure they produce the same number of degrees by lowering drop-out rate, possibly with the use of student learning methods and more use of students as assistants.

Amidst the discussions of austerity measures at universities, a disturbing statistic has emerged from the employment ministry, showing that Finland now has more than 1,000 unemployed PhD graduates. According to Petri Koikkalainen, president of the Finnish Union of University Researchers and Teachers, “the situation is expected to worsen when many fixed-term employment contracts end”.

He said the number of new PhDs has increased from 300-400 during the 1980s to more than 1,800 in 2014. “For a long time, the labour market seemed capable of taking in the increasing number of doctoral graduates, but now that no longer seems to work.”

Koikkalainen points out that the cutbacks proposed by the new government in universities and the education sector more generally are “especially harmful in this situation, because they will make employment even more difficult in universities and other research institutions, which traditionally have employed a great share of doctoral graduates”.

Only 18% of Finnish research and development personnel hold a PhD, which means that there should be room for PhD graduates in the labour market. However, it appears that there are widespread beliefs that they are "overqualified" – both in private industry and public administration.