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There should never, ever be cuts to public universities, say economists in Malaysia

Less money for universities means less capacity to retain professors. Source: Shutterstock

Economists are warning the Malaysian government to stop the cuts to the country’s education sector in the run-up to the tabling of Budget 2018 next week.

At an iMoney forum discussing Budget 2018 yesterday afternoon, panellists listed the dire consequences that will result from further shrinking the coffers of the country’s educational institutions.

“What this budget should not do is to cut development spending for education and health,” economist Muhammed Abdul Khalid said.

“These are not expenses, these are investments. These are going to give you returns,” Khalid said.

Last year, public universities spending was axed by close to 20 percent, a cut described as “severe” by iMoney.my CEO Lee Ching Wei. Their combined operating budgets were slashed by RM1.5 billion, with 10 out of 20 public universities facing massive cuts ranging from over 10 percent to over 31 percent, as reported by The Malay Mail Online.

Universities were told to better “utilise” their assets to sustain themselves financially. Higher Education Minister Datuk Seri Idris Jusoh in 2015 argued this would help public universities to be less reliant on the government in line with the Malaysian Education Blueprint 2015-2025 (Higher Education).

Total allocation for the Higher Education Ministry in 2016 was also reduced to RM12.13 billion from RM13.38 billion the year before – a cut of nearly 10 percent.

As a whole, there is lesser money being set aside for education by the government – World Bank data show government expenditure on education, calculated on the basis of percentage of GDP, has been on the decline from 2011 onwards.

Such cuts bring dire consequences, panellists warned, such as universities’ inability to retain professors and to conduct research.

And given the economic reality the Malaysians currently live in, such as having the highest household debt in Asia, former assistant secretary-general for economic development at the United Nations, Jomo Kwame Sundaram says incurring higher debt to fund their education will not bode well for them.

“We have a situation in Malaysia right now where, for example, the savings of an EPF member are such that more than 80 percent will not have enough to generate an income above the poverty line after retirement,” Jomo said.

“These are the kinds [of] realities we have, but unfortunately are not getting sufficient public attention.”

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