Hong Kong is failing its smart young people with its unfair university funding system

C. K. Yeung says all students who qualify for a university education should be supported to receive one, yet this is not the case now with a subsidy system that gives the better-off too much and the needy too little

PUBLISHED : Saturday, 13 August, 2016, 9:32am
UPDATED : Saturday, 13 August, 2016, 9:32am

Education equality is the hallmark of a fair society. This past week, 24,000 Hong Kong secondary school graduates became qualified for university admission based on their exam results. Of these, only about 16,000 received subsidised university places, with the remaining 8,000 having to turn to self-financing institutes. Are these young people getting a fair deal?

The cost of educating a student at the eight government-funded universities averages about HK$242,000 a year. The students who get into these universities – some two-thirds of those who meet the qualifications – receive about HK$200,000 each in subsidies, and pay the balance of about HK$42,000 in tuition fees. The remaining third of students pay the full cost of their education, about HK$65,000 a year. The cost of educating one student at a government-funded university could pay for four students at a self-financing university.

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Why such a big cost difference? Blame it on the lopsided funding system. It arbitrarily divides our 24,000 university-ready youngsters into two groups. All these students have achieved the university entrance mark and their academic performance forms a continuous spectrum that cannot logically be divided into two distinct groups for the purpose of giving out subsidies. But, due to historical reasons and a twisted funding system, a line is drawn. This dichotomy defies logic and creates inequality.

Institutes which mushroomed during the boom are left to fend for themselves. This is neither fair nor in the interest of the public

The government’s logic in educational planning is baffling. In the primary and secondary sector, it chooses to hollow out the public schools, turning the good ones into fee-charging direct subsidy schools, thus denying students from poor backgrounds access to quality education. In higher education, it does the reverse, generously funding public universities, which admit many students from fee-charging secondary schools, that is, students from better-off families. It leaves self-financing institutes at the mercy of market competition, where students from worse-off families have to bear the full cost of their education.

The government’s funding policy also muddies students’ choice. For instance, say that Chinese University charges HK$242,000 per student per year for a degree in journalism, and Shue Yan University asks for only HK$60,000 for the same programme. Despite the huge cost difference, Chinese University will still be the more affordable option for students because, with a subsidy, their fee comes to about HK$42,000. The choice becomes distorted.

Before the decline of birth rates began to bite, the government encouraged the establishment of privately funded tertiary institutes to meet the demand of students shut out of publicly funded universities. But, as Hong Kong’s fertility rates drop, the pool of prospective students shrinks. These institutes which mushroomed during the boom are left to fend for themselves, with many bleeding red ink. This is neither fair nor in the interest of the public as universities, publicly funded or not, all serve a key public good.

The number of students graduating from high school is projected to drop from this year’s 52,100 to 43,500 by 2020. Too many tertiary institutions will be chasing a shrinking pool of students. The situation is so dire that some self-financing institutions have zero admissions for certain programmes. As tuition fees are their main source of revenue, their fate is sealed, unless the government has a change of heart about its funding policy.

What this society needs is not equality of outcome, but equality of opportunity in education

Which is why Antony Leung Kam-chung, a former financial secretary and ex-chairman of the Education Commission, through his Education 2.1 group, has resurrected the concept of education vouchers for the tertiary sector. Given the looming crisis, the idea is worth revisiting. A chief advantage of the voucher system is its flexibility, as it is portable, with the money following the student. Under this system, a student can pick any course he or she likes from any university, depending on the strength of the institute. This has the effect of encouraging competition in curriculum design and teaching quality.

The voucher scheme is only one of the options to redress the funding problems. The current subsidy system is clearly indefensible. A partial subsidy for students at self-financing institutes, even if only at a fraction of the amount received by publicly funded institutes, is needed.

If the present funding arrangement continues, the feast-and-famine phenomenon of local higher education will worsen. You only have to look at the case of the University of Hong Kong-affiliated Centennial College, a self-financing institute. It has run itself into near bankruptcy due to insufficient enrolment and has had to be rescued by the HKU.

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Each year, the government pours HK$18 billion into the tertiary education sector, benefiting only about 16,000 students. Is this a cost-effective way to spend public funds? Is it fair to the large number of qualified students who are kept beyond the gates of the eight universities funded by the University Grants Committee? How do you justify subjecting self-financed institutions to market competition, while leaving the publicly funded ones immune to it?

The existing higher education funding policy is contrary to the principle of equitable distribution and social justice. What this society needs is not equality of outcome, but equality of opportunity in education.

C.K. Yeung is an education worker