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A rally for “half-priced tuition,” which was held in June 2011, was the major social issue. There was a massive rally in which participants criticized the rate of rising tuition. Many enraged university students joined the wave and shouted “halfpriced tuition” instead of just studying for final exams. The presidents of the General Students’ Association (GSA) from Korea University, Sookmyung Women’s University, Seogang University, and Ehwa Women’s University held a joint press conference at Ewha Women’s University, demanding that President Lee, Myung-bak deliver on a campaign pledge to halve tuition.
This incident formed a social consensus in the fact that lower- priced tuition is urgently needed. In a poll conducted for the People’s Solidarity for Participatory Democracy, 92.3% of respondents answered “too expensive” to the question about the level of tuition, and 89.7% agreed to a “half-priced tuition policy.” To meet the needs of the times, political parties have stated that they will find a solution. The Board of Audit and Inspection of Korea decided to undertake a total audit of universities. The government thought that university financial problems was no longer limited to a particular university, but had rather become a national problem. Indeed, higher education is a core competence factor for a future Knowledge-Based Society. Thus, it is necessary to look into what the financial trouble at university is and to consider the way to move forward in the right direction.
Fundamental Causes of Poor Financial Structure
Universities’ poor financial structure is strongly tied to the tuition problem. Obviously, it is a very complex situation like a Mobius strip. It’s so confusing that nobody knows which one comes first. To analyze this complicated problem, we may classify the fundamental causes into two large groups: the internal and external factors. First, internal cause is financial leaking. Inefficient management, including unproven labor costs, and unnecessary expenses is raising the tuition fees. Small and limited finance is also other factor of the internal cause. Furthermore, they have not had any profitable business on their own. As a result, students have absorbed too heavy a burden from tuition.
Now, let’s look at an external factor. This is about the low level of financial support from government. Korea ranked second at $5,315, in terms of per capita tuition needed to study at public universities and graduate schools, according to 2011 edition of ‘Education at a Glance’, released by the Organization for Economic Co-operation and Development (OECD). The yearly average tuition at the country’s private universities and graduate schools was higher than the OECD average. Most Koreans were surprised and focused their attention on the high level of tuition. But the point is that the OECD statistics also showed that Korean citizens absorb the biggest burden of academic costs, starting with university tuition and private education, in comparison to other countries. The ratio of higher education costs by the government sector to GDP was about half the OECD average. 8 Also, the ratio of the private sector was nearly four times than the OECD average. In addition to this survey, earlier studies have shown the shortage of the government’s financial support for higher education.
To solve this problem, the government is making several attempt several methods. Lee, Ju-ho, Minister at the Ministry of Education Science and Technology, said “It is positive that universities strive to improve their structure.” Opening to the public a poorly managed universities list has induced inhouse restructuring. With the government’s continuing measures in higher education system, endangered universities have revealed their strong desire to improve its finances by carrying out structural reform and reinforcement of their capabilities.
However, this cannot be a real solution as it seems just a temporary measure to avoid the current crisis. The government wants to overcome this problem through the university efforts without the education budget expanding. Unavoidable sacrifice is part of change, but the government does not want to make the necessary adjustments to a changing situation.
Judging from what we have thus far seen, we might conclude that the current policies of the government and universities are not enough to achieve financial health. The biggest factor of poor finance in university is insufficient government aid. But the problem cannot be solved by one or two changes. We need to deal with the issue from a more systematic and long-term perspective. The University Life (TUL) researched the financial problem in various articles, thesis and interviews with experts. TUL suggests solving the problem stage-bystage.
Three Steps for Solving the Problem
First, the evaluation’s propriety should be set up. And it must be fully rational and understandable for everyone. Currently, there is a controversy about the indicator that is being used to evaluate universities by the government. “Evaluation indices were not appropriate and poor. They appraised universities in a lump regardless of their characteristic,” said Kim, Soo-kyung, Dept. Leader of Policy Research at the Korean Council for University Education. Chugye University is an example. “How can pure arts schools, where most of the majors are painting, music and literature, achieve the employment rate of 45%? It’s unreasonable to judge a school’s status by the employment rate,” said a Chugye University professor. Chugye University for the Arts was included in the list of schools to have their state-funded student loans restricted because it failed to meet criteria such as an acceptable employment rate of graduates, the yearly enrollment rate, and the number of full-time instructors. Ban, Sangjin, a professor at Chonbuk National University, pointed out that, “It cannot be said that the university is responsible for the low employment rate. In fact, the worsening social structure is related more to the rate.” The goal of university restructuring reform is sound finance. But ironically there was no criteria for financial status. An indicator reflecting the finance and characteristics of each university needs to be prepared. Criticism aimed at the government’s reform policy came from the lack of confidence in their evaluation indices.
In Australia, there is a good reference. The Australian Universities Quality Agency (AUQA), a public organization for evaluating universities, is being operated. They have developed various evaluation indicators and provide students and parents the means to correct information about a particular university. The evaluation has to reflect the diversity and character of the community.
Second, the government has to take strong action to reform universities’ structure with clear and definite criteria. In the government’s subsidies policy, efficiency is a major issue. Therefore, government policies have been focused on particular areas. Two months after launching the “University Restructuring Reform Committee,” they announced a list of 43 marginal private universities and vocational colleges that are excluded from next year’s subsidies list. This result is because of a failed financial policy. Lots of students and universities had a difficult time in the 1990s due to the government’s error. The government has selectively supported universities since the 1990s, but they could not catch this problem, even increasing tuition.
Nevertheless, the government is overlooking their own oversight. “Though there is something that should be done by the university, the government is responsible for the tuition problem,” said Kwon, Tae-hyun, a student at the Korean Campus Culture Solitary. Moreover, their efforts to kick out poor universities could bring harmful damage to diversity from applying a uniform standard. However, this is an unavoidable sacrifice. But the government simply has to enforce the system.
Lastly, the total amount of subsidies should be raised drastically. This stage is most important. The prior steps are just a preparatory stage for the last step. After reforming universities with reliable stats, governmental aid must follow. We have to think about the public role of higher education. Universities, particularly private schools, have been responsible for higher education, providing an opportunity in the public interest. The main agent of education is the government because they are responsible for education. So, it is valid that the government provides subsidies to private universities.
Someone may pose the question, “Where is the money? Everyone knows education is important, but the money is limited. To increase the education budget, other budgets must shrink. But where?” There is no perfect answer for thi s question. However, we can find a suitable answer though public sentiment. Most people believe a large amount of tax revenue is going unspent. “Four Major River Restoration and Tax Reduction For The Rich…. These policies are now being argued, but I think they have failed. If the government adjusts its budget into an education policy, complicated problems should be solved easily” said Kwon, Taehyun, a student of Korean Campus Culture Solitary.
To resolve the financial problem raised by “half-priced tuition,” we have considered the solutions step-by-step. After careful consideration about the major causes of the financial problem, many experts pointed to insufficient government aid. So, the government has to increase support, and change their point of view in education. Maintaining the three-step solution is also needed. Also, the government should not forget lose the last step. If they stop at the reform phase as before, the people’s hope for sound finance in university would be shattered.