University Post
University of Copenhagen
Independent of management


Pind’s reform of subsidies will hit universities hard

Grant system — The Danish government will make ten percent of funding for universities dependent on students’ timely completion of their study programmes and on how quickly they get a job

Minister for Higher Education and Research Søren Pind is working on a reform of the so-called taximeter system which will hit the University of Copenhagen (UCPH) hard.

Pind’s new grant model

Basic grants (about 20 per cent)

Activity grant (about 70 per cent)

Quality and performance grant (about 10 per cent)

The minister wants to make ten per cent of funding for universities dependent on students completing their studies on time and on how quickly they get a job.

And here UCPH is doing relatively poorly: The university’s latest 2016 figures show that only 36 per cent of bachelor students complete their studies on time and only 61 per cent complete with one year’s delay.

For master’s students, 22 per cent complete studies on time with 72 per cent completing studies with a one year delay.

Rector: UCPH will be challenged

According to the government proposal, education institutions will be penalized financially if students on average are more than three months late at the bachelor’s and master’s level.

The news site Politiken writes that Søren Pind will not present specific calculations showing how the new model will affect individual institutions’ finances. But Charlotte Rønhof, deputy director at the Confederation of Danish Industries, cautiously guesses that humanities studies will be hard hit.

Rector Henrik C. Wegener calls for calm. He points out that this is a negotiating proposal from government, and that it now has to be negotiated in parliament.

“We hear that there is no complete agreement among the parties, and now a long process begins where we will, of course, try to influence the final outcome,” he says, adding:

“There is no doubt that, as a university, we will for a period of time be challenged by an employment taximeter. But it looks like we will get time to adapt, and UCPH is in full agreement that our graduates should get jobs. All our programmes aim for this.”

What about the quality?

The rector, on the other hand, is disappointed that the proposal does not include a quality dimension.

“The government has for several years spoken of focusing on quality, but now quality is being translated into speeding up and getting a job. But at least this is not a cutback or a proposal to redistribute funding. If the government wants to do something for quality, then more money should be forthcoming,” says Henrik C. Wegener.

University director Jesper Olesen has previously stated to the University Post that a taximeter dependent on graduates getting jobs is not the University of Copenhagen’s favourite solution. It would lead to subjects that have a slightly higher unemployment rate among graduates entering a vicious circle with less and less funding, less and less able to provide quality education.

“We are not in love with the employment taximeter, not because of narrow financial interest, but because we think it is the wrong lever to pull, as it will hit some specific programmes hard. At UCPH we are working to get a system that actually supports quality,” the director said in a 2016 interview outlining the gloomy financial prospects.

Showdown with skewed incentives

According to Søren Pind it is necessary to take action against the present taximeter system, as education institutions have been able to speculate on increasing admissions to increase revenues.

“If the government wants to do something for quality, then more money should be forthcoming”

Rector Henrik C. Wegener

“With this initiative we take issue with the one-sided focus on quantity – to get as many students through as possible. Instead, we motivate education institutions to focus more on the quality of education and to get the students jobs after graduation. We allow more management freedom at the institutions with the new model, and we set up frameworks at the same time to reward really good programmes, and that students complete on time and get to work,” Pind says in a press release.

Penalty threat

The finances of many universities have already been threatened by what UCPH Prorector Lykke Friis has dubbed a ‘progress penalty’.
The 2013 Danish Study Progress Reform had a political majority of Social Democrats, the Social Liberal Party, the Socialist People’s Party, the Liberal Party, the Conservative Party, the Danish People’s Party and the Liberal Alliance forcing universities to reduce the average study time by 4.3 months by 2020.

In the case of UCPH this would mean a DKK 250 million financial penalty if it fails, and with the new funding reform, another fine will be added on top.

DKK 200 million must be reallocated

The Ministry estimates in a memorandum with the title ‘Clear framework, better balance’, that it may cost education institutions DKK 200m a year.

But this is on the basis of old employment data. It is proposed that the 2014 numbers are used when the calculation is done in 2019.

The government will compensate institutions whose total education subsidy falls by more than one percent in a transitional phase of three years. According to Forskerforum, DKK 65 million has been put aside for this purpose.

Anders Bjarklev, chairman of the Danish Universities interest group and rector of DTU says to the news site Politiken: “The damage can initially only reach a certain size. Then we will have to wait and see how badly or how well it goes when things are distributed”.

Money for quality development

The intention is that the money should be allocated to educational institutions for specific measures that can strengthen the quality of education. Universities should expect to have to apply to different quality pools to be able to get access to the funding. As an example, the ministry mentions the development of better education course procedures, including the development of teaching and examination forms, and the build-up of teacher and supervisor skill capacities.

Better feedback and interaction between teachers and students, digital education opportunities and a more active study programme culture are other possibilities.

Students dissatisfied

This does not reassure Marie Thomsen, vice chairman of the Student Council at the University of Copenhagen:

“I think there is too much focus on getting people through their studies fast. There are many students who have student jobs, internships etc. that can delay their programme of studies. Medical students who take leave to do work will also be hit hard.”

“They only focus on educating for the labour market. But it’s really hard to predict the future of the labour market. A lot can change in society over the five years it takes to take a university education,” she says.

Camilla Gregersen, Chairman of DM, the Danish Association of Masters and PhDs, warns directly against an employment taximeter in the magazine Magisterbladet.

“I want to warn against funding for education being distributed on the basis of the employment rate, because it does not elevate the quality of education, but only leads to arbitrariness and uncertainty. I believe that the employment taximeter should be excluded from the model as labour market trends should not affect the students enrolled in education programmes”.

Søren Pind has subsequently written on Twitter that the government proposal for grant reform will mean that a smaller share of university finances will be dependent on student completion times than the current model.