European HE systems predict post-COVID funding squeeze

University leaders in seven of the higher education systems in Europe – Belgium-Flanders, Croatia, Czech Republic, Finland, Romania, Serbia and Spain – predict a fall in core national funding as a result of the COVID-19 crisis, according to a survey of rectors’ conferences conducted during the summer.

Feedback from 28 of the national rectors’ conferences to the European University Association (EUA) also shows that the main impact so far has been on rental and commercial services – with contractual research also taking a hammering.

For those more reliant on tuition fees, 14 national university sectors predict a fall in income from international students as a result of travel and other restrictions on student mobility in 2021-23.

The preliminary results from the summer survey, titled “Impact of COVID-19 on university funding in Europe: short-term trends and expectations” were presented to this year’s EUA Funding Forum on Tuesday 22 September, which was held online instead of in Belgrade as originally intended.

The findings will be developed for the EUA’s Public Funding Observatory, which annually captures the latest trends affecting Europe’s universities and provides up-to-date information on 34 different higher education systems across the continent.

University funding under pressure

Thomas Estermann, the EUA’s director of governance, funding and public policy development, told University World News: “Our survey was carried out in July and August and shows the great uncertainty about the development of funding over the next two years.

“Seven national systems of higher education expect a decline in core national university funding, with a further eight rectors’ conferences unsure about developments.

“Even the national systems not anticipating a decline are under strong financial pressure as significant investment will be required as a consequence of the corona crisis, especially in digital technology and staff training as universities move to a hybrid model of physical and remote learning, with staff able to carry on teaching from home where necessary because of the health emergency.”

The survey showed that 21 of the 28 higher education systems responding to the questionnaire had seen accommodation and commercial revenue streams directly affected by the campus closures due to the pandemic.

A further 16 reported that income was falling from contract research, especially with businesses hit by the economic impact of the coronavirus, for example, aeronautics.

As well as 12 reporting that international tuition fees had already been affected by COVID-19, nine higher education systems predicted a fall in philanthropic funding.

Other areas expected to be hit include funding from the European Union, competitive public funding and domestic/EU tuition fees.

Core national public funding for higher education was predicted to go down by seven of the rectors’ conferences, which represent university presidents, rectors and vice-chancellors. But three respondents – France, Italy and Switzerland – expected such funding to go up as some national governments acknowledge the important role that higher education and research will play in helping countries recover from the economic and social impact of the coronavirus crisis, Estermann told University World News.

A further 10 of the rectors’ conferences thought core national public funding would remain stable despite the austerity measures that may be forced on governments after the pandemic.

Uncertainty over European funding

There was less certainty about what could happen to European funding, with four of the 28 respondents expecting it to increase for higher education and research; five predicting it was likely to go down; eight saying they thought it would remain stable and 11 unsure.

With regard to changes expected in private funding in 2021-23, 14 national rectors’ conferences expect revenue from international tuition fees to go down and 11 systems believe contractual research will shrink in the short term, according to the survey.

Estermann said the picture was not uniform across different countries, with Spanish higher education institutions, for example, predicting that national funding for its universities would decline over the next two years; competitive funding for research remaining would remain stable and funding from the European Union would be likely to go up.

In contrast, Finnish university leaders thought that national public funding and competitive funding for research would fall over the next two to three years while they were uncertain what would happen to European funding.

“Falls in funding in areas like contractual research are likely to lead to an increase in applications for national and European competitive funding and result in a decrease in success rates and efficiency,” Estermann warned.

He told University World News: “Our latest survey shows there is considerable uncertainty about funding higher education and research over the next two years around Europe.

“Looking back at the financial crisis in 2008, we can see there was a split between those systems that have continued to invest and those that have reduced. A similar situation can be expected in the years to come if governments do not apply the lessons of that crisis in 2008, with the universities that are leading with strategic decisions likely to come out of the crisis in a better way.”

Estermann said he was encouraged that more national governments were recognising that education and research were strongly contributing to economic development, especially after the crucial role universities played during the COVID-19 crisis.

“But national governments have piled up huge debts during the pandemic and we must expect to return to certain austerity measures.

“The big challenge for the sector is to show how universities can help economic recovery. To do this we must build on the wider understanding among policy makers about the importance of education and research, which was so vividly shown by scientists, for example, during the corona crisis,” said Estermann.

“But we face strong competition from other sectors which employ many people for limited resources and a belief among some policy people that universities are able to look after themselves.”

The 28 higher education systems responding to the EUA survey over the summer were Austria, Belgium-Flanders, Belgium-Wallonia, Croatia, Czech Republic, Denmark, Estonia, Finland, France, Germany, Hungary, Iceland, Ireland, Italy, Luxembourg, Norway, Poland, Portugal, Romania, Serbia, Slovakia, Slovenia, Spain, Sweden, Switzerland, the Netherlands, England and Scotland in the United Kingdom.