OECD: Germany’s publicly funded, no-fees system ‘unsustainable’

Germany’s system of publicly funded universities is delivering falling funding per student and is “not sustainable”, according to the Organisation for Economic Cooperation and Development – but the German government has staunchly defended its record.

Figures in the OECD’s annual Education at a Glance report, published earlier this month, have prompted the organisation’s director of education, Andreas Schleicher, to offer criticisms of Germany’s funding model.

Germany is a major player in world higher education, with 22 institutions in the top 200 of the latest Times Higher Education World University Rankings, a tally surpassed only by the US and UK.

Seven of Germany’s 16 states – which have principal responsibility for higher education – introduced fees of up to €1,000 (£859) after a constitutional court ruling in 2005. But by 2014, all those states had abolished fees following student protests and political pressure.

The OECD’s country note on Germany says that “the number of students in tertiary education increased by 28 per cent between 2008 and 2013”, one of the highest increases among OECD nations in that period.

It adds: “Although Germany increased total expenditure in tertiary institutions by 16 per cent between 2008 and 2013 (reaching $16,895 per student in 2013), the increase in expenditure has not kept up with the increase in the number of students, resulting in expenditure per student at tertiary level that is 10 per cent lower than in 2008.”

And the OECD continues that across its member nations “the share of private funding in tertiary education is 30 per cent, while in Germany the share is only 14 per cent”.

It also says that Germany’s “annual expenditure directly related to instruction (educational core services) per student at the tertiary level is $9,085, below the OECD average ($10,222)”.

The German newspaper Die Welt said the OECD’s figures indicated that the increase in student numbers at universities “has led to a sacrifice in teaching quality”.

Mr Schleicher told THE: “The point is that rising participation has far outstripped the increase in public funding. The German funding model is simply not sustainable.

“The labour-market outcomes of higher education studies have risen steeply, so you have more young people looking to study. But the government isn’t able to provide the funding nor does it allow public universities to mobilise private financing. That’s why you see a decline in spending per student.”

Horst Hippler, president of the German Rectors’ Conference (HRK), said that additional federal and state resources were provided for increased student numbers under the Higher Education Pact, an agreement between the two levels of government. But he added that these resources “rely on parameters”, such as assuming students do not switch university and complete their courses in a set period, “which don’t apply to reality”.

Professor Hippler noted that the abolition of fees by states “was compensated at least in part” by replacement public funding.

And he added: “The private share of the funding of the German higher education system is traditionally low, because higher education is esteemed as a public good.”

A spokeswoman for Germany’s federal Ministry of Education and Research highlighted the OECD’s figures on tertiary education public spending with financial assistance for students taken into account. These show “that German expenditure is exactly the OECD average with a GDP share of 1.3 per cent”, she noted.

She added that federal spending on higher education doubled between 2008 and 2013 “to almost €5 billion (£4.3 billion)”.

The spokeswoman also noted that spending per student in tertiary education is $16,895, above the OECD average of $15,772, when Germany’s “high expenditure” on research is taken into account, which she said was an appropriate measure given the “unity of research and teaching” at German universities and the benefits that research funding brings to students.

Barbara Kehm, formerly chair of the German Society for Higher Education Research and managing director of the University of Kassel’s International Centre for Higher Education Research, said that Mr Schleicher has “always has been a proponent of tuition fees. So I believe that he is using his clout to influence policymaking on this issue”.

Professor Kehm, now professor of leadership and international strategic development in higher education at the University of Glasgow, added: “Yes, the rise in student numbers has been considerable and funding hasn’t kept up with that. Most institutions feel structurally underfunded."

But, she said, “putting tuition fees back on the agenda is the easy way out of the dilemma and shifting the problem on to students’ back rather than finding a policy solution or prioritising (higher) education in state budget allocations.”

john.morgan@tesglobal.com