Higher Education Funding in Indonesia

The Jakarta Post reported that the Indonesian Director General for Higher Education, Satryo Soemantri Brodjonegoro would increase the subsidies for universities. The government would disburse a Rp 13.5 trillion (US$1.5 billion) fund next year to subsidize costs at state-run and private universities. Good news for Indonesian higher education? Of course, every extra dollar or rupiah is welcome. But...

He admitted that the increase would not cover education costs for university students. "The amount is too small to meet the demands of poor families who want to have access to higher education," he said. In recent years the government has decreased its subsidies for state-run universities and encouraged them to find their own funding sources. As a result, some state-run universities began offering courses for exorbitant fees.

Starting from 2000, Indonesia’s leading four institutions have – in financial terms – basically been privatised. Institut Teknologi Bandung, Institut Pertanian Bogor, Universitas Indonesia and Universitas Gadjah Mada received the so-called BHMN status (Badan Hukum Milik Negara or ‘state owned legal entities’). The other public universities in Indonesia are meant to follow this path in the future. Universitas Sumatera Utara (USU) received the status in 2003, followed by the Universitas Pendidikan Indonesia (UPI) in early 2004. BHMN meant greater autonomy and autonomy was necessary because the universities, under the Suharto regime, suffered from a serious lack of academic freedom. But autonomy did not just mean academic autonomy, it also meant financial autonomy. And this basically translated into budget cuts. These cuts were so severe that some of the universities now only receive about a quarter of their financial means from the government, where it used to be nearly 100%!

The chronic underfunding of Indonesian education was acknowledged by the Megawati regime. At that time the pledge to allocate 20% of the government budget on education was even incorporated in the constitution. But what is going on in reality? As we see below, Indonesia’s spending on education as % of GDP has slowly decreased in the early years of this century. While in 2003, Indonesia spent only 0.9% of its GDP on education, Malaysia spent nearly 8 %!

For all graphs: Red = Indonesia; Blue = Malaysia

So is the 20% objective unreasonable? For sure, the 20% objective is far from achieved in Indonesia. Malaysia however spent even more than 20%, while Indonesia did not even reach 10% (no data for 2000 & 2003). However, there has been some improvement after 2002. For 2006, the expenditure on education is 11.8 % of the budget. Some improvement, but still far from the promised 20%.

For higher education, the situation becomes even more sever if you see that Indonesia spends relatively less of its education money on higher education, compared again with Malaysia. For Malaysia, between 30 and 35% of its education budget went to higher education between 2000 and 2003. For Indonesia that is less than 25%.

What is also interesting to see in this respect is where the money is spent. Below you can see that the majority of Indonesian spending is current expenditure. For Indonesia that is over 80%, of which nearly 100% goes to salaries. For Malaysia current expenditure is around 50% and much less of this goes to salaries. Capital expenditure for Indonesia thus is very low, pointing to a serious underinvestment in Indonesia’s universities.

What has been the result of all this? Basically two things. For Indonesia it has led to rigorous inequality for higher education. In the past decades the government has done a good job in eliminating inequality in elementary education. But if we look at data from Triaswati and Roeslan (2003), presented by Nizam in a recent UNESCO report on Higher Education in Southeast Asia (PDF; 4.6 MB), we can see that inequality increases with the level of education. While 30.9% of the richest quintile receives higher education, of the poorest quintile, only 3.3% is that lucky.

The second result is that the autonomous BHMN universities are becoming ever more entrepreneurial. This in itself is not a problem and it is seen in nearly all countries. The Indonesian BHMN universities have undergone such a drastic change in just a few years but have coped with it relatively well. But they are seriously underfunded, especially if we consider that the demand upon them has grown. Increasingly they are expected to deliver high quality research and, much more than their Malaysian counterparts, rely heavily on the market and the private sector to acquire research funding. Somewhere along the line you will have to ask whether the political domination has been replaced by the domination of the market.

In this light the increase of subsidies can be seen as too little too late. Maybe it is never too late to invest in education, but an increase from 12.9 trillion to 13.5 trillion Rupiahs is definitely too little!

(data for the first four graphs are from the UNESCO education database)

Indonesia Too Democratic?

Can a country be too democratic? Vice President of Indonesia, Jusuf Kalla, thinks it can be. The Jakarta Post reports on his visit to China, and it seems like Kalla is quite impressed by what is going on in China. If only Indonesia was a bit less democratic they would be able to make the same progress as China is making.

"China's strength is that it can plan and implement. Our system, which is too democratic with too much individual freedom that often disregards the rights of others, has made it difficult for us to build infrastructure"

"As long as individual right is above public responsibility, we will not progress... That's the only problem we have now."

A strong government role can help economic development, as is shown by Indonesia's neighbors Singapore and Malaysia. But going the same way as China is simply not an option for Indonesia anymore, after almost 10 years of democracy. And despite all the troubles in its short history of democracy, the country is showing progress. Progress not just in terms of economic development but also in terms of intellectual and artistic freedom. Sure...Indonesians might hit the streets a few times too many, but I guess that's a healthy sign, even though it might not always correspond with the governments plans.

An interesting example is the TV show Newsdotcom, better known as 'Republik Mimpi' or the Republic of Dreams (below is an item on the show by Australian current affairs programme Dateline). It is a show with a healthy dose of political satire, including impersonations of former presidents Gus Dur and Megawatti, the current president Yudhoyono and even Jusuf Kalla. This definitely wasn't imaginable in the Soeharto Era and probably would lead to quite some government opposition in other countries in Southeast Asia. Even though Information and Communication Minister Sofyan Djalil planned to file a legal complaint against the producer, the show has been allowed to continue.



Maybe a small sign of hope amidst the many troubling things happening in Indonesia. Nevertheless, I think it is an important one. And in the long run, such minor steps and a little bit 'too much democracy and individual freedom' can give Indonesia some major advantages compared to (semi-)authoritarian countries.

Travel report

Here, somewhere between Los Angeles and Sydney, I decided it's time to resume posting again. I'm returning from a very long and interesting trip through Indonesia, Malaysia, India, the Netherlands, Portugal, Canada and the US. In three of the countries I have conducted interviews for my research: Indonesia (at Institut Teknologi Bandung and Universitas Gadjah Mada), Malaysia (Universiti Sains Malaysia and Universiti Malaya) and the Netherlands (Rijksuniversiteit Groningen and Technische Universiteit Delft).

My research analyses the way in which nation states and universities respond to the increasing importance of knowledge for economic development and global competitiveness. One thing I'm particularly interested in is the extent to which a process of global policy convergence can be detected in these responses.

In later posts I will try to refer to some of the experiences I've had in these countries. For now, just a few short observations

Indonesia has come a long way, but is struggling. Indonesia's elite universities are more and more relying on student fees and entrepreneurial ventures to sustain their operations. Just over 5 years ago, these universities were almost solely dependent on government funding and strictly directed by national regulations. It of course has also given them much more autonomy. I remember I had some interviews in Indonesia in 2001, just after some of its public elite institutions received the autonomy status. At that time they were clearly struggling with their newly gained autonomy. Compared with 2001, one now seems to be much more decisive on what directions to go.

I couldn't have chosen a more interesting time to visit Malaysia. During my visits in Penang and Kuala Lumpur, the Times Higher Education Supplement issued its annual top 100 ranking of universities. One conclusion must be that the THES ranking is nowhere taken more seriously than in Malaysia. This however can be said for higher education as a whole. In politics as well as the mainstream media, higher education gets more attention in Malaysia than in any other country I know. But at the same time this has led to a remarkable progress in higher education and science. I've seen very interesting examples of cutting edge research, supported by impressive facilities. Also politically, Malaysia has proven to be fascinating. I won't go into details here, but it has become clear to me that - due to its impressive economic and scientific progress - Malaysia's tight political control seems to become less and less sustainable. If some of the governmental regulations won't loosen up, Malaysia might become a typical example of the incompatibility between paternalistic politics and a creative knowledge society. Future will tell..

And than there's the Netherlands. My visit coincided with the national elections, and if there is one word that best illustrates the result of the elections it is: conservatism. Dutch universities however, seem to become more and more innovative. My visits gave the impression that the traditionally rather rigid Dutch universities have become more flexible and are more open to change than they used to be.

But as I said: more posts to come on these issues...

All in 1 week

In the past week, three remarkable men have passed away. The best writer of all times, one of the most innovative artists of all times and one of the most influential economists of all times.

Pramoedya Ananta Toer (1925-2006) passed away last Sunday (30 April).

For me, his numerous books, short stories and essays are the most remarkable works I have ever read. Both his use of language and his choice of topics make that his books and stories portray a lively picture of Indonesian societies and cultures. Toer brought history to live, from the early Majapahit kingdom to the first stages of colonialism, from the first movements towards independence to the repression of the Suharto regime. I wrote a short post on is work before. Here is my top 5 of his work:

1. Gadis Pantai (The Girl from the Coast, 1962)
2. Buru Quartet: Bumi Manusia (Earth of Mankind, 1980); Anak Semua Bangsa (Child of all Nations, 1980); Jejak Langkah (Footsteps, 1985) and Rumah Kaca (The Glass House, 1988)
3. Korupsi (1954)
4. Keluarga Gerilya (The Guerrilla Family, 1950)
5. Arus Balik (1995)

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Karel Appel (1921-2006) passed away last Wednesday in Zurich.


Appel was probably the best known contemporary Dutch painter. He was one of the founders of the COBRA group, a group of painters from Copenhagen, Brussels and Amsterdam, allied with abstract expressionism.






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John Kenneth Galbraith (1908-2006) passed away on Saturday 29 April.

From the Economist:

"At six foot eight, he was a giant. Intellectually he was equally towering, a man who spent more than seven decades either on the stage of American public policy - as a bureaucrat in Franklin Roosevelt's New Deal, a confidante of John Kennedy and adviser to countless other Democrats - or loudly lambasting Washington from offstage left, as a Harvard professor."

And a well known quote:

"There are two classes of forecasters: those who don't know, and those who don't know they don't know"

Pak Pram's new book

The IHT has an article on one of the greatest writers of our time: Pramoedya Ananta Toer. Toer (a.k.a. Pak Pram) is probably best known for his Buru Quartet, named after the island Buru where he was imprisoned while he wrote the book. It consists of four books telling the saga of the first stirrings of Indonesian nationalism seen through the eyes of a young Javanese student. The books are This Earth of Mankind (Bumi Manusia), Child of All Nations (Anak Semua Bangsa), Footsteps (Jejak Langkah), and House of Glass (Rumah Kaca). I have read nearly all of his books and my personal favorite is Gadis Pantai, a brilliant portrayal of Javanese culture illustrating a spectrum of Indonesian religion, traditions, gender roles, and socio-economics.

His latest book, Jalan Raya Pos (The Great Post Road) was published in 2005. As far as I know it is only available in Bahasa Indonesia but hopefully there will be a translation soon (otherwise I guess I'll have to repolish my language skills and read it in Indonesian). The book is about a major highway 1,000 kilometers across the north coast of Java by the Dutch governor General Herman Willem Daendels, in the early 19th century.

Although long lost in the mists of history, Pramoedya conservatively estimates that the construction of Daendel's Great Post Road cost the lives of more than 12,000 workers who toiled as forced laborers in indescribable conditions to build a seven-meter-wide road so that the wheels of commerce fueling Dutch wealth could grind more efficiently. Pramoedya follows the Great Post Road as it winds itself across the island of Java, using every town and district along the way as a marker of colonial excess and corruption.

What isn't told in the IHT article is that the book was previously 'published' as a movie in 1996. This 150 minute documentary/road movie tells the story of a writer, a road and the history of a country. Through a long and winding road that symbolizes the long Dutch oppression, through places and conversations that symbolize the oppression of Suharto's New Order, the writer that suffered terribly under both regimes uncovers the history and culture of his country. Here's an excerpt from a review by Vanessa Hearman in Inside Indonesia:

Generous in its coverage of the everyday experiences of Indonesians, it speaks with road gangs, tea pickers, newspaper sellers and a hotel-building entrepreneur who is largely blind to the daily reality going on around him. The narration is sparse, allowing for Pramudya's reading to dominate.

For this film, Pramoedya Ananta Toer wrote an essay which I assume forms the basis for the new book with the same name. I can't wait to read it..