SINGAPORE — As public funding for universities in other countries decreases — in part due to competing economic and social demands — new funding models and more international collaborations are set to emerge in the global higher education landscape, said speakers today (Oct 15) on the second day of the OECD-Singapore conference on Higher Education Futures.

In America for instance, funding cuts of over 10 per cent has been seen in states like Arizona and Pennsylvania. American universities also have to vie for funding with other social programmes like post-retirement initiatives, while raising tuition fees is often not as option as it can be controversial, said Ms Susan Fitzgerald, who is senior vice president for global higher education and Not for Profit ratings at Moody’s Investors Service.

To ensure financial sustainability, American universities are therefore raising revenue by introducing new programmes online or at the Master’s level, or leveraging on its resources. Ohio State University, for example, rents out car park facilities. Ms Fitzgerald added that more universities – like prestigious institutions – would too be expected to forge collaborations with universities overseas, as an alternative revenue source, and to extend their brand name.

“As we look forward, universities that are going to thrive…are those that (are) going to make very tough decisions in terms of resource allocation and strategic priorities…(we) are going to find growing number of partnerships…partnerships with industry, with each other, partnerships with local government,” said Ms Fitzgerald at a conference session on costs in higher education. “Cost shifting and cost sharing is going to be part of higher education.”

In Australia, funding for universities fluctuate with new governments and economic cycles. Mr Mark Warburton, principal analyst of Universities Australia – an organisation that advocates for Australian universities – said that the Australian government unveiled a generous package in 2009 including support for lower-income students and research funding for universities. But when economic growth slowed subsequently, and other societal pressures like ageing population arose, higher education funding was cut. Among other things, the Australian government reduced research funding and cut financial support for student living expenses. All this left Australian universities “bitterly disappointed”, he said.

But Australian universities still continued to invest heavily in research — expenditure on research is two times more than its income — and revenue could come from sources like tuition fees and international collaborations.

He warned against over-reliance on tuition fees for income, as it is unsustainable. Instead, governments should be funding university research as the outcomes will benefit the public, he argued.

Ms Fitzgerald noted that the popularity of international university rankings might also have resulted in universities spending excessively on research to improve their standing, even though not institutions all are meant to be research institutions.

State funding cuts, she added, are not necessarily a bad thing. “(This) would force (institutions) to step back that they wouldn’t normally do, and…look at their core business… to see how they are allocating (their) resources not just on an incremental basis but on a fundamental basis,” she said. “Sometimes a harsh environment ends up with better quality outcomes.”