Free higher education is ‘regressive’ – World Bank

In many countries free higher education is “regressive”, according to a senior World Bank official, because those accessing it are only from advantaged families.

Francisco Marmolejo, tertiary education co-ordinator and lead tertiary education specialist at the World Bank, said there are countries where the percentage of college-age students from the lowest income quintile accessing higher education is only 4%, while 60% to 70% of college-age students belonging to the highest income quintile are enrolled in higher education. Some of those countries are among the ones with a tuition-free policy which, in fact, is “prolonging the unfortunate stratification in our society”, he said.

Marmolejo was speaking in a discussion on the question of who benefits from higher education and who should pay for it if systems are to be sustainable, at the British Council’s Going Global conference in London on 2 June.

The session was chaired by Patti McGill Peterson, presidential adviser for global initiatives, Center for Internationalization and Global Engagement at the American Council on Education, who said this had been an electoral issue in many countries and the trend is towards a “steadily growing private share”. The question was what balance to strike between private and public funding.

Marmolejo said he was proud of public education in his country, Mexico. Without subsidy he would not be sitting on the podium himself. At the National Autonomous University of Mexico, or UNAM, students pay a symbolic fee of less than 2 cents.

“This makes higher education accessible to at least half of the students,” Marmolejo said. “But at the same time it leaves about a quarter of students without contributing when it is within their capability. Is it regressive? People feel entitled to have free education but we should look at it from a general society perspective.”

“If you are serious about equitable access you have to be serious about cost-sharing in higher education,” he said. “In many countries where problems [with equitable access] exist there is a regressive higher education system where people insist higher education should be free but those accessing it are only from advantaged families.”

Hot topic across the world

David Bell, vice-chancellor of the University of Reading, UK, said this was a hot topic in England and across the world. He said there was no such thing as free education. “Someone always pays, whether it is the taxpayer in general or the beneficiary or a combination of both.”

The key issues were: will financing be assured, will there be barriers to access, will provision be of good quality, and will it represent value for money for those paying for it?

He warned against universities engaging in an “amenities arms race” in which they all try to build “better and bigger facilities” for their students.

Marmolejo said there is a lot of room for more efficiency in higher education, where the cost per student is 18 times higher than in primary education.

Jacob Kaimenyi, cabinet secretary in the Ministry of Education, Kenya, said the answer to who benefits was “everybody, whether directly or indirectly”. It is for that reason that you will find that in countries which are high on the development index the majority of leaders have higher education, he said.

There needs to be public-private partnerships because higher education is so expensive, he said.

Robust defence

David Willetts, the former UK minister for universities and science, robustly defended the UK government’s decision to allow university fees in English universities to triple to £9,000 (US$13,800) while complementing this with improved measures to support students from less advantaged families.

He said there was a common misperception he came across internationally that the decision meant that in England university education was being privatised.

That is misleading, he said, because there is still high public funding for aspects of higher education, for instance for high-cost subjects, university capital, high-cost students, such as disabled and disadvantaged students who are subsidised, and for low-earning students, who will not have to pay off their loans.

“So it is a public-private mix,” he said.

He said the pivotal moment for the UK came 15 years ago when universities observed that in the battle for public funding they were regularly coming at the back of the queue.

“Even in the World Bank, there was a strong pro-schools, anti-higher education culture,” he said.

“Universities saw no prospect of the percentage for higher education increasing, so there was a need to top up with private payments.”

He stressed that the English system was different from that of the US in one crucial way, that “private payment should not mean students paying up front”, because that would harm access.

“It’s a private payment which in public policy framework you only pay back if you get a well paid job.”

The tripling of tuition fees had been a hot topic politically, he acknowledged, and some of the controversy was based on “fears that were misplaced – fears that you had to pay up front”.

“In reality we are unique in having no up-front fees whatsoever,” he said.

There was also anxiety that students from poor backgrounds would be put off. But vindication of the policy lay in the fact that there were now “record numbers” accessing high education, including “record numbers of disadvantaged students” and more money coming into universities than ever before, he said.

Donor funding

Jacob Kaimenyi reminded the audience that there are some situations in the world – countries facing conflicts and natural disasters – where there was a need for international funding or even a global fund for higher education in emergencies, as had been proposed in another session earlier in the day.

David Bell warmly welcomed the World Bank’s recent radical rethink on long-term aid, now including higher education as a key component where for decades it had focused on basic education to the complete exclusion of higher education.

He noted the contrasting approach of the German government which spends 60% of its aid budget on scholarships for higher education in Germany.

And he cited a new World Bank study, which for the first time has shown that, per dollar, higher education is providing higher returns than primary education around the world, except in the Middle East and North Africa region.

“It is changing,” he said. “The World Bank is radically shifting its view.”

Disguised protectionism

In a side note, David Willetts said the UK government’s rules on student loans are a form of “disguised protectionism” because they prevent students using the loaned money on studying abroad, unlike other countries.

Speaking at the British Council’s Going Global conference for leaders of international higher education, Willetts said: “One of my regrets [of my time as minister]: compared to other systems, where our system is weak is in funding students to go abroad. I think there is an implicit disguised protectionism in saying that your fee loans can only be spent in British universities.”

He said he would have “loved” to have been able to offer to those foreign ministries that provided scholarship schemes to the UK that in return the UK would allow English students to use their student loans to study in the foreign minister’s country, on condition that the foreign host university met the required standards for quality.

Other speakers contrasted the English approach to that of Germany where tuition fees are no longer charged and international students also study for free.

According to the German Academic Exchange Service, DAAD, if around one in three international students stays on in Germany and works for five years, it offsets the money invested in their studies in the country.