23 September 2019 • HOP, Bas Helleman
Where are the cutbacks in higher education coming from?
In the distant future, research universities and universities of applied sciences will need to give up 226 million euros because students will not be pay higher interest rates on their student loans. What is happening exactly?
The new cuts to higher education were announced in the government budget presented by cabinet last Tuesday. Could we have foreseen these cuts? What is going on with the interest on student loans?
Who came up with those higher interest rates?
The interest rates were agreed on in the coalition agreement. In the long run a higher interest rate would generate 226 million euros in yearly revenue. D66 minister Van Engelshoven defended the idea halfheartedly. The idea had been the brainchild of the CDA and the ChristenUnie.
Where was the money supposed to go?
That was not quite clear. The coalition agreement simply described this as a measure that would generate money, in addition to a series of measures that would cost money (for example, reducing tuition fees for first-year students by 50%). However, it would take years for this money to become available, so it was of little use to this government. The idea was to safeguard the ‘sustainability’ of government funding in the future.
Could we have predicted these funding cuts?
Most likely. The planned increase in interest rates had been called off. So less interest means less money.
The government itself has been responsible for creating this uncertainty. The Dutch Lower House asked what would happen if the interest rate wasn’t increased. Despite questions, the government didn’t want to get ahead of the facts.
Even when the proposal had been withdrawn – it was likely to be rejected by the Upper House after intense student protests – the government stayed mum on the issue. “You will find out on the day of the King’s speech”, was the minister’s written reply to questions from the Lower House.
When will the cuts take effect?
This may take a while. The first small amount of revenue was only expected in 2025 and was supposed to increase to 226 million euros by 2060.
Obvious question, how does higher education feel about these changes?
The research universities and universities of applied sciences are very displeased. “Harmful and hard to understand”, states Pieter Duisenberg, president of the Association of Universities in the Netherlands (VSNU). “A tough cutback”, says Maurice Limmen, president of the Netherlands Association of Universities of Applied Sciences.
Was there a good reason for this decision?
No reason was given. The additional revenue had not been earmarked for specific expenses, so why is only higher education footing the bill? Even the government doesn’t seem convinced of its own decision. The cutback is ‘technically allocated’ under higher education, as if this is a mere formality.
Is there a political reason for this?
Perhaps they had to choose the lesser of a few evils, as nobody likes to cut education funding. Most attention is now focused on primary education. The government is treading very carefully here. Cutbacks were announced to wages in education and science, but elementary schools weren’t included.
There will also be an investment fund set up for innovation and knowledge development. Perhaps the government rationale is that once the fund is implemented higher education and research will still greatly benefit. That will make this new cutback irrelevant. But we aren’t quite there yet.