A New Dynamic: Private Higher Education

Financial consideration2Financial considerationJohn Fielden and Kai-ming ChengIntroductionOne of the reasons for the dramatic growth in PHE is a financial one. Highereducation is very expensive compared with the basic and secondary sectors, andgovernments simply cannot afford to fund the expansion that is desired. This has twomain consequences; a reluctant move to ways of passing on some of the costs tobeneficiaries (in charges and tuition fees) and a more favourable policy towards theprivate sector. Traditionally, both of these policies were anathema to socialistgovernments, but interestingly, many of these have been the first to implement them.In financial terms, the advent of the private sector represents a fundamental shift inthose countries where its presence has been small, since what had been a whollypublic good, publicly financed, is now increasingly regarded as a shared public/privategood, privately financed. 1 The private sector has removed a financial burden from thestate and has helped to contribute skilled manpower to the economy. Generaltaxation no longer bears the entire cost of tertiary education and much of the cost isborne by those individuals who benefit directly.The private sector is already involved in higher education in many ways, as theprovider of infrastructure, support services, educational materials and software, sothat it is not a large step towards it becoming a deliverer of education. This is oftenhappening with the full approval and endorsement of the public sector, so that theold boundaries are blurring. A current study in the United Kingdom, where until1 As we see from Chapter 1 there are several countries (such as Indonesia and the Philippines) wherethe private sector has been dominant for many years.29