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Annual Review of Education, Communication and Language Sciences, Volume 2, 2005

 

EQUITY IN PRIVATE HIGHER EDUCATION: INTERNATIONAL PERSPECTIVES

NUNTARAT CHAROENKUL


Abstract

Equity in higher education is a widely discussed topic between academics, educators and scholars all over the world. It has

become high on the agenda of both national and international debating forums featuring the reform of higher education in aspects

of access, equity and quality in this level of education since the entry of private bodies into the world of education. This article

aims to study and develop the key theoretical perspectives on equity, alongside quality, in private education worldwide, which

will meaningfully contribute to the promotion of equality and social justice in private higher education as well as to the

establishment of an appropriate safety net or a security system which will help encourage higher level of participation from

disadvantaged students of lower-income backgrounds. It will significantly lead to a more lively debate on the ethics of markets in

education and a captivating investigation on a correlation between equity and quality in private higher education.

Introduction


          Equity in higher education markets has been a widely discussed topic between educationists, economists and

philosophers worldwide. For instance, in Thailand, since the promulgation of its Eighth National Development Plan of Higher

Education (from 1997 to 2001), equity has been raised on the agenda of many educational forums and debates nationwide.

With its stated intention to develop equity in Thai Higher Education, the Thai government set up two main education policies

concerning access and equity as well as privatisation and corporation. Under such policies, the government has stated its

intention to widen access to higher education for socio-economically disadvantaged high school or secondary school leavers,

regardless of their socio-economic status, gender and geographical characteristics. At the same time, it has encouraged private

institutions to play a more important role in the organisation of higher education and in the provision of equity in higher learning.

Working Definition of Equity
          Unlike absolute equity without difference (where people have the same needs, same ability and same aspirations that lead them to the same tastes and expectations) as implied by Le Grand (1991), equity in this context relates to adequacy of educational opportunities for people with different needs from dissimilar socio-economic backgrounds who are supposed to be enabled and encouraged to choose what kind or which level of education suits their (or their children’s) needs and capacities.
Thus, equity (in this context) means that no person who has the ability to benefit from higher education should be excluded from its system on the grounds of his/her lack of wealth or financial resources. It could be interpreted as equality of opportunities as recommended by Friedman, 1980, or adequacy of opportunities as suggested by Tooley, 1996a. Friedman (1980, p.132) states that this fits in with a remarkable concept existing in the French expression dating from the French Revolution (1789): “Une carri?re ouverte aux les talents” (or a career open to the talents). This expression implies that people should not be deprived of or prevented from gaining or achieving the rewards or positions that befit their talents, qualifications and values. Not birth, nationality, race, religion, gender nor any other arbitrary obstacles should determine or limit the opportunities that are open to an individual, but only his/her abilities. Also, in this context, equality of opportunities and adequacy of opportunities as well as social justice are the working definition of equity. They are used as synonyms. Quality or efficiency stands for academic excellence of university staff and students as well as competence in academic services of each institution.

The Link between Equity and Quality
          Nevertheless, the perception of the link between equality and quality, with the awareness of the coalition of these two components’ objectives in education markets, is affirmed and reiterated by OECD (1997). The OECD (1997) report on Education and Equity in OECD Countries implies that, to relieve economic and social problems in a modern society, equity is to be harmoniously integrated with quality, not to be withdrawn for it. Actually, equity is like a crucial engine which helps develop efficiency. A society or community in which only a few groups of elites and the well-to-do are highly educated and have advantages above others cannot be recognised as a society of high quality in the provision of knowledge. Hence, equity or equality of opportunity is to be integrated with quality or efficiency of a unit, an institution or a state in creating and providing adequate knowledge and opportunities for individuals in correspondence to their different needs, dissimilar capacities and divergent goals of life. Through obtaining adequate opportunities, knowledge and training, individuals will have equal rights to choose jobs, improve their incomes and further develop their skills in accordance with their different objectives and abilities. Therefore, equality of opportunity (for individuals) in a modern society, as recommended by Henry et al (2001), can be interpreted as an individual right to choose whatever suits their needs, capacities and knowledge. However, it is difficult to identify an individual’s need and what could be regarded as adequacy of opportunity and knowledge for each person. So each country or each society may have to define an appropriate scope of equality or adequacy of opportunities in its own context and find out what its people’s or its members’ basic needs are.

          According to Henry et al (2001), though the integration of equity with quality (at all levels of education) has been and should be regarded as unproblematic, some educationists and critics, like Henry and Taylor (1993), have argued that these two elements are totally divergent and each pulls in completely different directions.
         

           Amongst contrasting views against education markets and capitalism, Real et al (2001), after conducting their interviews of some students on the relations between social classes, races and their decision to go to some particular universities, revealed that class as well as racial inequalities influence students’ decision-making regarding the selection of their universities and colleges. Nevertheless, it still remains uncertain that this results from education markets. In addition, the research results could not be based only on single approach (interviews of some non-traditional or working-class applicants to higher education). Regarding the non-clarified procedures of the selection of respondents, it is risky that the results obtained from the interviews of those working-class informants would express attitudes of some particular groups of applicants to higher education.

          Despite the need for more well-grounded evidence and reliable methodology applied, all contrasting ideas mentioned above have brought on and stimulated further research and exploration of equity, its real meaning and practicalities in education markets at all levels.

International Perspectives on the Development of Equity in Higher Education
           For the development of both quality and equity, universities (both private and public) should search for alternative sources of funding, apart from the government and universities themselves. They need to mobilise greater private and external financing. According to the World Bank (1994) and Bray (1998, 2002), this can be achieved through users-pay funding mechanisms or cost-sharing with students (as previously suggested by Friedman, 1963, and Henry et al, 2001), e.g. in the form of tuition fees and the diminution or elimination of subsidies for non-instructional or unnecessary costs, donations and endowments from alumni and private industry or external aid and lending agencies (in the form of trust funds), and income-generating activities, e.g. short-term courses and training programmes, workshops and seminars (open to public), contract research for industry and consultancy services. In terms of cost-sharing or revenue diversification, van Harte (2002) recommends that, besides the introduction or the increase of tuition and the decrease in government-subsidised costs of maintenance and books, the government should rely more upon student loans (to be repaid after graduation) while simultaneously reducing the amount of merit-based grants and full scholarships to be allocated to each institution. Moreover, the government should promote an increase in the use and the general availability of private higher education opportunities.
          

          Universities can use the above external funds, obtained from cost-sharing plans, various forms of endowments and income-generating activities, to boost up quality and efficiency through the improvement of curricula, instructional equipment and student services as well as the development of instructional and research skills, alongside ethical values, of their faculty/staff. To enhance equity, universities and colleges can make the best use of the exceeding amount collected from affordable and better-off students, through the cost-sharing system, to improve their quality in the provision of education and services, and simultaneously to increase the availability of student loans or targeted grants (in parallel to the cost-sharing or fee-charging system) for the least advantaged and lower-income students. However, universities should be more transparent and assertive in communicating with their students concerning the necessity and advantages of a cost-sharing plan as well as their strong commitments to maintain or develop quality and efficiency in instruction, student aids and services. In addition, as suggested by Bai (1998), students who study specialist areas of national importance or areas in want and who are from the most economically deprived areas can be either entirely exempt from tuition fees or granted a special subsidy.

          Moreover, as previously suggested by Friedman (1963, 1980) and supported by Calero (1998), to make higher education markets more sensitive to students (especially those disadvantaged with government funds and support) and more efficient in the provision of education, funding policies in each country call for the shift from the supply-side funding (in which the government allocates some funds to universities for further operation in the development of instructional and research quality as well as student support) to the demand-side funding (in which public funds go directly to students who will have more freedom to choose their appropriate providers of education and programmes of their interest). As indicated by the World Bank (1994), once economically disadvantaged students are allowed to take their assistance package to any institution of their choice, they will have an opportunity to make the same choices as their higher-income peers. Such portable funding approach could stimulate competition amongst universities and colleges to develop and offer courses and programmes in line with student demands. In short, the government can use the demand-side funding as an instrument or a kind of market forces to promote access and equity for able but disadvantaged people and, in the same time, to stimulate the development of quality and efficiency of both private and public institutions of higher education. This will also provide private universities with a chance to have more access to public resources by accepting more low-income students, financially supported by the government, into their institutions.

Student Loans: A Vehicle for the Promotion of Equality of Educational Opportunity

          In the provision of direct financial support to low-income students, through the demand-side approach as mentioned above, Finnie (2002) recommends that the emphasis should be on loans rather than grants. In a grant system, normally, some funds, either with or without strings, are awarded to a very limited number of qualified students (usually those with outstanding academic performance). Actually, those students might not be necessarily needy in a long-term sense, since they tend to go on to relatively successful careers and to have above-average earnings levels, out of which they will be able to afford to pay back any reasonable level of student loans. In a loan system, the money is supposed to be paid back and will be, subsequently, recycled. This recycled amount of money can be used to further support other disadvantaged students in the future. Therefore, the loan system seems to be more practical, especially at a time when the government funds for student financial support are extremely limited. This means that the loan system can provide more assistance to more students in a more effective and equitable manner than can grants, debt remission, or lower tuition fees. However, in some exceptional cases, for those who come from very low-income families, grants could be an important element of an overall student aid package (even as the emphasis should be on loans).
          Although the loan system is likely to be more practical and effective than the grant scheme, it seems unreasonable to predict that the student borrowers’ future incomes and earnings level will be surely high enough and should not bring in any problem to them when the time of repayment arises. Also, it could discourage some under-represented students, who are so concerned about being chronically loan burdened after the completion of their degrees that they may decide not to participate or further take part in higher education. Therefore, as suggested by Finnie (2002), an interest-relief programme (for individuals whose low incomes cause them undue hardship), a debt-relief scheme (for individuals who are facing chronically excessive debt loads) as well as an insurance plan against an excessive debt burden (for all borrowers who may or may not use it) could be introduced to raise the confidence of student consumers who would like to invest or continue their investment in higher education markets.

Income Contingency Plans: An Approach for the Relief of Debt
Burden on Student Borrowers

          Apart from the above-mentioned loan relief and debt reduction schemes, another solution which is likely to be effective is an income-contingent repayment (ICR) model, in which student borrowers will be required to repay their loans with interest through the taxes, defined by Curtin (2000) as graduate taxes, or the national insurance system, when they reach some proportion of the national average income. Through this model, the repayment of the loans is contingent upon income (a fixed percentage of future income over a given period of time) or income-related. So when a borrower’s lifetime income is low, repayments are small.

          The income-contingent loans and repayment system had been previously suggested by Friedman and Kuznets (1945) and Friedman (1963), was further developed by West (1993, 1995), and was agreed by a number of researchers in the field of education policy and administration, like Seville and Tooley (1997) and Turner (2001). It seems to be the most effective repayment model, which meaningfully helps relieve serious problems arising from debt burdens of low-income and financially disadvantaged students. According to West (1995), contingency systems encourage the sharing of responsibility between the users of higher education, without unfairly drawing upon the incomes of taxpayers who are poor are non-users of higher education. Even though some borrowers’ lifetime earnings are low (which results in their small repayments), the government, with more revenue or surcharge obtained from more successful and higher-income borrowers, will be able to cover the costs of financing the less successful or lower-income borrowers.

          However, Johnstone (2001) pointed out that one of the drawbacks of the income-contingent plans is that if incomes of the borrowers are paid irregularly or come from multiple sources which are difficult to be traced, it could bring in some significant losses.
          Another shortcoming of these plans, as claimed by Finnie (1996), is the possible difficulties for the government, as a main lender or provider of the loans, who needs to be responsible for the substantial up-front capital costs and who tends to face a variety of uncertainties about its long-term financial viability as well as about the default rates.
          In response to these weaknesses, an effective cost-sharing or top-up fees policy, together with the search for additional sources of funds (e.g. contracted research, academic consultancy, partnerships between the government, universities, the private sector and industrial companies), should be scrupulously taken and translated into action in line with the above mutualised or externally-subsidised plans. To cope with the problem of irregularly paid incomes and unidentifiable sources of earnings, Johnstone & Aemero (2001) suggest that repayments be collected non-income contingently, for example via a coupon book or a hybrid system (a slightly modified conventional mortgage-type scheme), in which the borrowers are bound to pay out the known costs with a fixed (and manageable) rate of interest (plus some percentage of the risk of defaults and administrative cost), to be either deducted by employers or collected yearly by a national tax agency, and a determined repayment schedule, that is changeable and yields a debt-free or suspension period whenever the borrowers face clearly demonstrated or verifiable difficulties, unemployment or unexpected hardships in the course of their loan repayment.
Conclusion
          In conclusion, all the international concepts and philosophies cited and debated in this article have generated and enhanced concerns about equity in higher education markets. From such concerns, various ideas and approaches in the promotion of equity, alongside quality, have been created and developed to assist the least advantaged people of a society. To foster social justice of higher education markets in the age of global economic freedom and academic capitalism, the term equity is to be defined as equality of opportunity or adequacy of opportunities (as suggested by Tooley, 1996a), which enables all individuals to pursue their objectives in accordance with their needs, capacities and knowledge. However, a market of real quality (at all levels of education) should establish and improve a kind of welfare or safety net for disadvantaged people who are qualified for a certain level of education but are deprived of adequate educational opportunities, due to lack of inherent wealth and resources. Such a safety net may have dissimilar forms at different levels of education, in different places and social contexts.
          All the international perspectives, concerning equity in higher education markets, discussed in this article are expected to serve as a guideline for the establishment and improvement of safety net in the markets of higher education worldwide, especially in developing countries. These universal awareness and concerns about ethics in higher education markets, as well as the Friedman’s concept of equity as part of quality, are conducive to further research, concerning the possibility of the harmonious co-existence of equality or adequacy of opportunities and quality in higher education markets across the world, as well as the development of various aspects of safety net or education welfare for the qualified but socio-economically disadvantaged (who would like to participate in higher education) in conformity with higher education policies and socio-economic circumstances of each country, in this era of globalisation and educational freedom.

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About the author


Nuntarat Charoenkul (nuntarat@gmail.com) was an IPhD student at the School of Education, Communication and Language

Sciences, University of Newcastle upon Tyne, England. She has just graduated with a PhD in Education and Communication.

Her field of interest is education policy and administration. Her specialisation is higher education in Thailand and the

establishment as well as the development of a kind of ‘safety nets’ or student aid programmes and welfare (e.g. scholarships,

grants, educational loans and work-study schemes) within private institutions of higher education in the country. Nuntarat is very

keen to explore the possibility of the co-existence of equality or adequacy of educational opportunity and quality in private

higher education in Thailand as well as in other developing countries.