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University of Southampton Research Repository Eprints Soton University of Southampton Research Repository ePrints Soton Copyright © and Moral Rights for this thesis are retained by the author and/or other copyright owners. A copy can be downloaded for personal non-commercial research or study, without prior permission or charge. This thesis cannot be reproduced or quoted extensively from without first obtaining permission in writing from the copyright holder/s. The content must not be changed in any way or sold commercially in any format or medium without the formal permission of the copyright holders. When referring to this work, full bibliographic details including the author, title, awarding institution and date of the thesis must be given e.g. AUTHOR (year of submission) "Full thesis title", University of Southampton, name of the University School or Department, PhD Thesis, pagination http://eprints.soton.ac.uk UNIVERSITY OF SOUTHAMPTON FACULTY OF LAW, ARTS & SOCIAL SCIENCES School of Management Funding higher education in Uruguay: a policy question by Panambi Abadie Thesis for the degree of Doctor of Business Administration July 2009 “The tension between properly supporting what exists while also responding to the demands of expansion is endemic. It can only be addressed as a policy question.” Darling et al, 1989 (p. 582) 2 Abstract UNIVERSITY OF SOUTHAMPTON ABSTRACT FACULTY OF LAW, ARTS & SOCIAL SCIENCES SCHOOL OF MANAGEMENT Doctor of Business Administration FUNDING HIGHER EDUCATION IN URUGUAY: A POLICY QUESTION By Panambi Abadie For years the dominant theme of higher education in Uruguay has been financial distress. However the literature relating to higher education has not addressed the question of how higher education institutions receive their funding. The aim of this study was to provide an analytical view of the current model of financing higher education in this country and predictions about its possible evolution or change according to the views of different stakeholders. This study used a qualitative approach and multi-modal tools -documents, literature, semi structured interviews, a Focus Group and speeches at Parliamentary sessions- were chosen to address several questions from different perspectives. Findings in this research suggest that the traditional historical funding model used until the 1990s has evolved into a historical/ incremental model. In this case, increases, or new funds that are allocated to the system, are tied to certain specific purposes determined in the Budget laws. In this way, funding relies on: (a) historical allocations, actually the biggest part of the allocations, which are always the same and are expected to be the same; and (b) new allocations (increases) focused on certain projects which are specified in the Budget Laws by the Parliament. In this way, Uruguay mirrors the regional pattern in which very little strategic planning occurs in the financing process. This study suggests, too, a particular approach to accountability in Uruguayan higher education. Resources are allocated to the system by the Parliament on a decentralised basis and institutions keep broad decision-making powers. The Ministry of Education and Culture is not involved in the process of allocating resources to higher education. The Government applies no control on institutional performance or efficiency. University autonomy is considered the raison d´etre of this approach; information gathered for this study suggests that Governmental agencies hold very little concern about the use of public funds. Internal use of public appropriations has bureaucratic controls and is only monitored through the conventional accounting audits prescribed by law. This research shows that a new left wing state-wide administration headed by the Frente Amplio Party will devote more funds to the finance of public higher education, primarily concerned with the insufficient amount of funds devoted historically to the sector. A considerable increase is expected as political leaders and Government officers have announced that the educational sector will receive added funding in the future Budget Law. However, there is also a view that, although the system will receive further funding, the funding model will remain the same. Moreover, whilst there is concern about the insufficient amount of funds devoted to the sector, the majority of stakeholders are not paying attention to the merits or problems of the current model of funding the sector. 3 This study also suggests that : a) in the future the funding authorities may expand the mechanism of allocating funds oriented to special programmes and, in this way, introduce some kind of strategic orientations; b) further funding for public institutions may be originated in the collection of the graduate tax and that its utility could be improved in ways to introduce more funding to the system; c) it is unlikely that a future model will consider the use of formulae or quality considerations; and d) the introduction of a tuition- fee scheme is very improbable in the short term because the availability of further funding will reduce the pressures to introduce alternative funds to complement public revenues. Further, the ideological and political predominance of the Frente Amplio party in the Parliament (historically placed against tuition-fees) will certainly abort discussions about cost-recovery in the public University. 4 Author´s declaration I Panambi Abadie declare that the thesis entitled Funding higher education in Uruguay: a policy question and the work presented in this thesis is of my own. I confirm that: this work was done wholly or mainly while in candidature for the research degree at this University; where any part of this thesis has previously been submitted for a degree or any other qualification at this University or any other institution this has been clearly stated; where I have consulted the published work of others, this is always clearly attributed; where I have quoted from the works of others, the source is always given. With the exception of such quotations, this thesis is entirely my own work; I have acknowledged all main sources of help; where the thesis is based on work done by myself jointly with others, I have made clear exactly what was done by others and what I have contributed myself; none of this work has been published before submission. Panambi Abadie 30 July, 2009 5 Acknowledgements Many people contributed to the completion of this study. I would like to thank my supervisor Professor John Taylor for his useful feedback on all the work we have shared together. This process has been an interactive and condensed one, and his help invaluable. My thanks also go to the numerous individuals and organisations that gave time and thought to the questions I posed. Without their contributions this thesis would never have been possible. I would also like to thank the University of Southampton CHEMPaS which has partially funded my studies. That also goes for Rosemary Reynolds and for Jose Pedro, María, my parents and my brother. 6 List of abbreviations ANEP Administracion Nacional Enseñanza Publica National Administration of Public Education ANUIES Asociacion Nacional de Universidades e Instituciones de Educacion Superior National Association of Universities and Higher Education Institutions, Mexico CEPAL Comision Economica para America Latina Economic Commission for Latin America CEPRE Programa de Reforma del Estado Programme of Reform of the State CIPFA The Chartered Institute of Public Finance and Accountancy, United Kingdom CUC Consejo Directivo Central Central University Council, University of the Republic IDB Inter-american Development Bank GDP Gross Domestic Product FOMEC Fondo para la mejora de la calidad de la Educacion Superior. Improvement of Higher Education Quality Fund, Argentina FEUU Federacion de Estudiantes Universitarios. Student Union (UdelaR) FUM Federación Uruguaya del Magisterio Association of Basic School Teachers IESALC Instituto de Educacion Superior para America Latina y el Caribe Institute of Higher Education for Latin America and the Caribbean LSE London School of Economics and Political Science MERCOSUR Mercado Comun del Sur. Trade Agreement between Brazil, Argentina, Paraguay and Uruguay. Chile and Bolivia are associates but not members. MP Member of Parliament OECD Organisation for Economic Co-operation and Development ORT Universidad ORT TOCAF Texto Ordenado de Administracion Financiera Laws and decrees about financial management and accounting in public agencies of Uruguay UCUDAL Universidad Católica de Uruguay UdelaR Universidad de la Republica UE Universidad de la Empresa UM Universidad de Montevideo UNDP United Nations Development Program UNESCO United Nations Educational Scientific and Cultural Organisation UNICEF United Nations Fund for Infancy THEC Tennessee Higher Education Commission WB The World Bank 8 CONTENTS CHAPTER 1: INTRODUCTION AND THE RESEARCH PROBLEM ..................... 20 1.0. INTRODUCTION ............................................................................................................... 21 1.1. THE RESEARCH PROBLEM. BACKGROUND. ............................................................... 21 1.2. STATEMENT OF THE PROBLEM .......................................................................................... 25 ORQ 1.1 HOW ARE FUNDS PROVIDED? .................................................................................... 27 ORQ 1.2 WHAT CRITERIA ARE USED TO DETERMINE ALLOCATIONS? ................................ 28 ORQ 1.3. WHAT ARE THE DEGREES OF DECENTRALISATION?
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