CHINA: No special allocation for universities

With more than 27 million students, China's current higher education system is the largest in the world. Some 24% of all 18 to 22-year-olds are now in a tertiary institution and hundreds of new universities have been established over the past decade.

As with other leading economies, but at a scale and speed that is unique, and with some $1.95 trillion in foreign reserves, China's national government launched an economic stimulus package of some 4-trillion Yuan (nearly US$600 billion) over two years beginning in November 2009.

But there has been no special allocation for higher education, beyond possibly national and regional universities gaining access to infrastructure funding. Thanks in part to the economic programme, and although various economic sectors focused on exports have had significant declines in business activity, China has not technically experienced a recession.

Already, there are signs the Keynesian approach of China to bolster its economy is paying off, with an estimate of a return to a GDP of around 12% predicted for 2010. While no national largess has thus far gone to higher education, at the same time national and regional universities and vocational and technical colleges have not received any mandated cuts in their operating budgets.

This means various national reform efforts remain in place, including continued expansion of access, new efforts at improving the quality of academic teaching programmes and research activity, special initiatives such as the 211 Project that has the aim of creating 100 top research universities in the coming decades and, more recently, the 985 Project focused on targeting funding to a small number of major Chinese universities.

These last two initiatives are part of the ongoing concentration of resources on a number of national universities to make them more productive and competitive in the international market place. The 982 Project is focused on a shift from quantity growth to quality enhancement.

But as some observers of China's burgeoning higher education sector note, the rapid expansion of access has led to a chronic under-funding, with student to academic ratios steadily climbing, low faculty salaries, and a new tuition system that includes higher fees at less prestigious institutions that has created problematic debt burdens for students and their families.

Despite the rising tuition income, many regional universities are struggling with their finances and going into debt. There remains, notes Ma Wanhua, "an alarming gap in quality between elite and mass institutions".

The net conclusion is that the great recession has not altered the path of China's national and regional efforts to reform and expand its higher education system, and there is increased acknowledgement by the Ministry of Education that the next step is to address funding and quality issues - including a plan to increase overall spending on education to an internationally competitive 4% or more of national GDP.

Currently, it is approximately 3.5% of a growing GDP according to the Ministry of Finance, significantly below the average of developed economies of about 5.46%.