Budget heralds another year of brutal higher education cuts

The coming year will see almost 20% slashed from the combined operating budgets of Malaysia’s public universities, according to the 2017 budget announced on Friday 21 October. It will be an even bigger cutback than the 16% drop universities suffered from the 2016 budget, which led to a public outcry.

In another year of misery for the public higher education sector, half of Malaysia’s 20 public universities will face swingeing cuts in the coming year – some will see government funding cut back by almost a third under the latest budget announcement designed to reduce the country’s fiscal deficit amid a slowing economy.

Total operating expenditure for higher education in 2017 will be MYR6.12 billion (US$1.5 billion), a cut of MYR1.46 billion or 19.23% from the 2016 allocation of MYR7.57 billion in 2016.

In an attempt to soften the blow, Prime Minister Najib Razak, who is also finance minister, announced in Parliament on 21 October that he would allocate MYR4.3 billion (US$1 billion) for government scholarships in 2017 – a significant hike compared to the MYR2.65 billion for scholarships in the 2016 budget, which cut scholarships and bursaries by 23% compared to 2015.

Slashing scholarships, particularly for top students to study abroad in countries such as Australia, Britain and the United States were a particular focus of resentment around higher education cuts last year.

In another ‘sweetener’, MYR300 million (US$72 million) will be allocated “for the empowerment of” five research universities – those ranked highest in Malaysian and Asian rankings – and another MYR100 million (US$24 million) for other higher education institutions “to foster research culture” as well as publications and intellectual properties.

Universities were expecting cuts, and had been calling on the government to preserve research expenditure. However, academics say internationalisation, particularly appointing more international staff, and attendance at conferences abroad and other international travel will suffer most, given the weakness of the Malaysian currency against other major currencies.

Main cuts

Universiti Kebangsaan Malaysia in Selangor will suffer the biggest reduction in operating expenditure, a 31% drop compared to 2016 allocations. It managed to escape the cuts of the last budget with a marginal 5% budget increase in 2016. However, Universiti Teknologi MARA will be hit with the biggest cut in value terms with MYR563 million wiped from its operating budget, a 30% drop on top of an almost 24% cut in 2016.

Seven other universities will see cuts of 20% to 30% in their operating budgets.

The country’s top ranking institution, Universiti Malaya, will see a 20% cut in its overall budget in 2017 on top of the 27% cut it faced for 2016 – the worst-hit institution in the previous budget.

Five other public universities, mainly in outer regions including Sarawak, face cuts of just over 5%. However, five smaller outlying institutions will actually see small increases ranging from 2% for Universiti Teknikal Malaysia Melaka and an 8.85% rise for Universiti Pendidikan Sultan Idris in line with increased government allocations for technical and vocational education.

The government plans to transform nine teachers’ training institutes into polytechnics and vocational colleges.

More with less

“It is going to be hard if not impossible for them [universities] to do more with less and less resources at their disposal,” said Nik Nazmi Nik Ahmad, the education member of the Selangor state executive council.

The Malaysian Academic Association Congress or MAAC said universities have already seen “scores” of researchers abandoning their studies after last year’s cuts.

MAAC President Idrus Mohd Masirin told local media that with the 2016 cuts some universities “are forced to halt entirely their allocations for research. This leaves students and lecturers with no choice but to abandon research altogether, or struggle to raise the money somehow if they want to pursue their research.”

He said engineering faculties were suffering because of rising prices on materials required for engineering education. Other academics said research laboratory activities were being kept “to a minimum”.

Higher Education Minister Idris Jusoh attempted to talk up the cuts, saying the reduction was in line with efforts to reduce public universities’ dependence on the government from 90% of their operating costs to 70%.

He said universities relied on up to 90% of government funding to stay afloat. “This is very unsustainable when universities all over the world only rely on around 40%-50% of public funds,” he said on Saturday 22 October.

Jusoh said universities had to generate their own income but the cuts could not be an excuse to raise tuition fees and was unapologetic about further cuts in years to come.

The higher education ministry in July released guidelines known as the ‘purple playbook’ to look into ways universities could improve their income, including publishing their own journals, training, alumni donations, endowments, unlocking assisting assets and commercialisation of various products.

“Professors can use their expertise to generate an income, get research grants, while universities can unlock their assets to enhance their income,” Jusoh said, speaking at a community college open day.

Universiti Kebangsaan Malaysia Vice-Chancellor Noor Azlan Ghazali told the New Straits Times newspaper: “Currently 25% of the Universiti Kebangsaan Malaysia’s operating expenditure is self-funded through endowments and collaborative work with the private sector. By 2020 this percentage will widen to 30%.”

However, academics said public universities have very little experience in raising revenue from non-government sources.