funding in norway 090608[1]
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Funding Higher Education Institutions in NorwayPresentation by Jan Roth Johnsen
Student delegation from the University of Oslo 9. July 2008
2 Norwegian Ministry of Education and Research
• General overview• Principles of governance• Funding system• Experience and challenges
The Norwegian funding model in higher education
3 Norwegian Ministry of Education and Research
This is Norway
• 4,7 mill inhabitants• Total land area of 386 958 km2
– sparsely populated• GDP per capita 462 000 NOK
– 2nd in OECD• Oil driven economy
– surplus national budget• Membership of EU: No
– but member of EEA 1 Jan. 1994• Capital: Oslo
4 Norwegian Ministry of Education and Research
The Norwegian Higher education institutions
One unified system and one act• 7 universities• 7 specialised universities• 24 University colleges• 2 national colleges of art
• About 25 private colleges– Mostly small, but one very large:
• National School of Management (9000 full-time and 9000 part-time students)
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Organization and overall funding of higher education
• The total number of students is 224 200• 31% of 19-24 year olds are now enrolled in
higher education• Women now comprise the majority (almost 60
per cent) of the graduates• Tax based systems• Public owned higher education institutions• No tuition fees in public owned institutions• State subsidies/ grants for students
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Funding system introduced in 2002
• Both a simplification and an extension of the economic responsibility of higher education: – simplification because the state’s control more
resembles overall control of framework– an extension because they activate a larger
element of local financial autonomy and responsibility
• Control by the authorities is restricted to the control of frameworks by means of contracts in order to ensure attention to national targets– plus some restrictions concerning investment in
capital goods, such as e.g. buildings
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Principle
• Simple – easy to understand– avoid unclear and crossing incentives– few and general indicators
• Foreseeable and predictable– stable indicators and weights – transparent and open
• Institutional level• Neutral
– no geographic, institutional or other preferences
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Components
• Basic component (60%)– about 55% of university budgets, 69 for
university colleges
• Education component (25%)– about 21% of the total allocation for university,
28% for university colleges
• Research component (15%) – result based redistribution: about 10% of
university budgets, 1-2 for university colleges– strategic part: about 14% of university budgets,
about 2 for university colleges
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Overall figures 2008
Basic:12 719 mill NOK; 60 %
Education5 134 mill
NOK; 25 %
Research3 193 mill
NOK; 15 %
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Basis component
• Average 60% of the total funding• A residual after the education and the
research component is calculated• Stable subsidy based on historical experience,
local differences and special tasks• The national targets of activity is evaluated
annually
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Education component
• Average 25% of the funding• Incentive-based component• Open budget frame• A close link between actual production and
unit cost funding• Resources are allocated according to number
of credit points taken and number of students on international exchange programs
• Make the Ministry’s budgetary process more predictable for the institutions and improve their capacity for planning and rational operations
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Education component
• Each study is placed in one of six categories according to how expensive they are. 60 credit points (one years study) gives (in NOK): – group A: 114 000– group B: 87 000– group C: 58 000– group D: 42 000– group E: 36 000– group F: 29 000– each exchange student generates 6000 NOK
• Covers 40% of the costs
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Education component
• The national target of activity is evaluated annually
• If the number of credits obtained by an institution within higher education exceed the national target set by authority, the financial subsidy is increased on the margin
• Correspondingly the financial subsidy is reduced on the margin if the number of credits are less than the national target
• Alteration in the result component is based on the results two years ago
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Research component
• Average 15% of the funding• Two parts; strategic and redistribution• Strategic – resources for Ph.D.’s, scientific
equipment etc.• Redistribution between institutions based on
indicators (weights):– scientific publications (0,3) – Ph.D. candidates (0,3)– allocations from EU’s Framework Programs (0,2)– allocations from Norwegian Research Council
(0,2)
• Closed budget frame
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Research component -Scientific production
• Local, national and international level• Defined by the origin of the authors• Publication types
– complete book– article in ISSN-title– article in ISBN-title
• Weighting of publication types– Level 1 and 2
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The 3 main components
Long term perspective and stability
Special cost structure and historical funding
Criteria based upon R&D (Funding from EU, NRC, PhD-candidates and publications)
Number of ECST-pointsNumber of exchange student
Basic component Education component
Strategic component
Redistribution component
Quality and activity in research
Quality and efficiency in education
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Some experiences
• Strong incentives• Increased number of ECTS-credits• Focus on research and results. There is a
discussion if the focus has gone from quality to quantity
• General acceptance of the principles in the model
• Pressure to include new indicators• Debate of publishing indicator
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Some challenges
• Reliable data• Some frustration with the online
documentation system• Some researchers claim there is too much
focus on accountable indicators• The internal design of incentives in institutions
– need to behave as autonomous bodies
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Public Higher Education Institutions
Private Higher Education Institutions
Research Council of Norway
European Commission
Ministry of Education and Research (Gov. budget)
State Education Loan Fund
Population
(X-)Students
Taxes
Tuiton fees
Loan/ Grant
Repayment
Resultat based funding
Resultat based funding
Appl. transfers
Global fundingFin. flow chart