Exco to provide an extra $504 million as Arthur Li honours pledge to maintain spending if the economy stays on track The government has scrapped plans to cut university funding by 5 per cent in 2007-8 following a 7.3 per cent expansion in the economy last year. The Executive Council is planning to provide an extra $504.3 million for universities in 2007-8, meeting a pledge by Secretary for Education and Manpower Arthur Li Kwok-cheung not to cut funding if the economy remained steady. Universities have welcomed the move ordered by Chief Executive Donald Tsang Yam-kuen - subject to agreement by the Legislative Council's finance committee - but are also asking for more money to fund preparations for the switch to four-year degrees in 2012. University funding is planned in three-year blocks - or triennia - and the plan for 2005-8 agreed by Legco's finance committee in February last year had assumed a 5 per cent cut for all universities and a 33 per cent cut for the Hong Kong Institute of Education in 2007-8, with budgets issued accordingly. Under Exco's revised plan, total university funding for 2007-8 will be $31.3 billion, a figure on a par with the previous two years following a 0-0-0 formula - referring to a recommendation by the University Grants Committee not to cut funding for three years if the economic recovery continued. Universities and the institute will receive an additional $483.2 million in their recurrent grants while an extra $504.3 million will be provided in targeted funding for areas including research, restructuring and collaboration activities, and research development. HKIEd will face a 28 per cent cut. The University of Hong Kong will retain $105.2 million that it was set to lose, Chinese University will keep $107.4 million, City University will have $61.6 million, and Polytechnic University will retain $82.5 million. For Hong Kong University of Science and Technology it will mean $60.1 million, for Baptist University it will provide $30.7 million, for HKIEd $23.5 million and for Lingnan University $12.2 million. An Exco paper for legislators released this week states: 'We consider that there are economic as well as financial grounds for adopting a 0-0-0 model as recommended by the UGC. 'Hong Kong's economy is expected to achieve solid growth in 2006, with GDP forecast to increase by 4 per cent to 5 per cent. Furthermore, compared with a year ago, inflation pressure is expected to turn moderately higher in the rest of the current triennium. 'The 0-0-0 model will provide additional resources for our higher education sector to develop during an inflation era. We recommend that the level of recurrent funding for the UGC-funded institutions should be maintained at the current level throughout the 2005-2008 triennium. This will provide the sector with stable funding when it is preparing for the reform of the new 3+3+4 academic structure.' A spokeswoman for the University of Hong Kong said it welcomed the decision but was calling on the government to increase funding for 2007-8. 'It will definitely help alleviate the financial burden on the university,' she said. 'However, it is still insufficient to meet the university's long-term development needs. As the economy improves, we hope government will consider an increase of funding in the 2007-8 academic year, so as to prepare for the implementation of the 3+3+4 new academic structure.' A spokesman for Baptist University said it would be helpful in maintaining the steady development of the institutions in the next few years and also assisted future planning. HKBU hoped sufficient resources would be provided to enable universities to play their full part in implementing the 3+3+4 curriculum. A spokesman for the Education and Manpower Bureau dismissed reports that Professor Li had said at a dinner meeting with the Heads of Universities Committee on Tuesday that funding would not be cut in 2008-9. 'The funding arrangements for 2008-9 are still under consideration,' he said. 'We expect that they will be finalised in the first quarter of 2008.' The Exco decision has yet to be discussed by Legco's education panel and finance committee.