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Comment from university management — University management does the math on what the future holds
Is the UCPH financial situation hopeful, or is it hopeless? The answer is probably somewhere between the poles of optimism and pessimism. The UCPH finances are the sum of several sums, with some going down and some going up.
Using old employment data to reward universities is like looking out of the rear view mirror while driving forwards.
In the education area, the year on year cuts are still on the government’s fiscal bill. This will cut two percent from the University of Copenhagen’s government grant each year. Next year, UCPH stands to lose a further DKK 41 million. In isolation, this may seem bad, and may be seen as a step in the wrong direction. The grants for education already do not cover the expenses. In order to mitigate the impact, UCPH is continuing its adaptation plan from last year, which means that the university will find DKK 200m in efficiency gains.
At the same time, research funding is increasing as Denmark is going through a period of economic growth and the government is maintaining its 1 per cent of GDP public research growth target. This means that DKK 400 million extra will be put aside next year. Some of the funds are already earmarked to different pools, including the Innovation Fund, where UCPH can win funding in competition with others in selected topics, such as “medicine adapted to individual patients” or “artificial intelligence”.
It is important that politicians maintain the 1 per cent target as a baseline. Fortunately, there is consensus that universities pay more than their value back to society, and that the funding of universities is an investment and not a cost. The Confederation of Danish Industry proposed this autumn that the target be raised to 1.5 per cent of GDP and that a ‘Globalization Pool 2.0’ be created following Prime Minister Anders Fogh Rasmussen’s model of the ’00s.
Part of our calculation is also that this university’s researchers have an impressive ability to attract external funding from the most demanding foundations in Denmark, including the Danish National Research Foundation. It is also a mark of quality that UCPH is among the top 10 university recipients of funding from the EU’s major research programme Horizon 2020. The UCPH revenues from external research funding have doubled in 10 years, and we will continue to develop this.
The wild card now is the government’s proposed reform of grants, which we are still waiting for. The government has warned that less money for education will be forthcoming in the areas where graduates have high unemployment rates. Although it is only a small part of the subsidies for education that is distributed in this way, it is a system that includes uncertainty, because it is hard to guess a future labour market, and we cannot predict a future scientific breakthrough.
Using old employment data to reward universities is like looking out of the rear view mirror while driving forwards, because the previous generation’s job success influences the framework that a university can offer the new students. And on top of this, there is a particular challenge for the small subjects. They have a high cultural value and are important for understanding our society, but they do not have a large job market.
UCPH has argued that the system should reward educational quality to the extent that it makes sense to measure it. For example by looking at instructors’ merits as researchers, precisely because a research-based education is the core of a good, classical university that is always relevant.