Latin America must raise fees to help poor

June 11, 1999

A continent-wide refusal to contemplate tuition fees is making a bad situation worse, argues Darrell R. Lewis.

Almost everywhere higher education is in trouble, but nowhere more so than in Latin America.

Demand for higher education has grown as more students complete secondary education, and public financial resources have been directed away from higher educationto other pressing needs, so that public funds per student have fallen dramatically.

The World Bank estimates that spending in public universities throughout the developing world has declined by more than 50 per cent over the past 20 years. The dramatic fall in per student support across Latin America has led to major concerns about diminished quality, efficiency and equity in the delivery of services.

Buildings are deteriorating, most research laboratories lack modern equipment, teaching materials are missing, and outdated curricula are prevalent. Travel budgets and supplies are very limited. Many universities still do not have adequate access to the internet. Salaries of professors have deteriorated dramatically, shifting recruitment and commitment to the profession.

Inefficiencies are rampant, especially in the public universities. Budgets are notoriously inflexible, student:faculty ratios and student graduation rates are low. Institutional missions are ambiguous, and strategic planning and institutional accountability are sorely lacking.

Despite declining institutional quality and increasing inefficiencies, most faculty and university administrators have persisted in not seeking alternative sources of funding - such as research and service contracts with government agencies and local industries, commercialisation of research and development activities, solicitation of contributions from alumni, and selling or renting portions of their assets. Crucially, they are strongly opposed to any expansion of tuition fees as a source of additional funding, largely on political and equity grounds.

Most of the public institutions in the region have argued that low or no tuition fees have provided greater equality of educational opportunity by providing greater access to historically under-served populations. Such reasoning is simply incorrect, as a rising tide in public higher education in developing countries does not raise all ships. To be sure, some additional low-income students have gained access to higher education through the enrolment expansions of the past 20 years, but the overwhelming public subsidy has been and continues to accrue to students from middle and high-income families. In almost all countries around the world, there is a greatly skewed participation of high socio-economic status in higher education. Both the World Bank and the Inter American Development Bank have consistently pointed out that in most developing countries overwhelmingly the middle and highest-income groups gain the most subsidy and the subsequent benefits. Experience in many other countries has also shown that access to higher education by lower income groups is not improved significantly by "no tuition fees" policies.

This regressive subsidy results from several factors. First and most important, the competitive examinations that most universities require for admission essentially exclude most students of low socio-economic status. Primarily this is due to the cumulative effects of growing up in culturally disadvantaged families and communities and of receiving weak secondary schooling. Second, most of the private costs of higher education do not result from tuition fees, but from transportation, food and housing costs, which are higher for low-income students coming from rural areas outside the main cities where most public universities are located.

Commentators on Latin America have noted that students from higher socioeconomic classes are easily able to absorb increases in fees. Evidence in other parts of the world indicates clearly that middle and higher-income students have both the ability and willingness to pay for higher tuition fees. Most observers recommend increases of up to 25 per cent.

But what would be the effects on low-income students? Given that most in both developing and developed countries are highly sensitive to such price increases, it is likely that major losses would take place without effective scholarship grants and loans programmes in place. The point here is simply that such programmes alongside increased tuition fees would not only generate more revenue for the institutions and be more efficient, but they would also contribute materially to enhanced access for poorer students with high abilities.

The needs are urgent for strong reform in the public higher education sectors of most Latin American countries.

Darrell R. Lewis is professor of educational policy, University of Minnesota, United States.

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