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Government freezes spending on unis

Government freezes spending on unis

As news of a spending freeze for universities emerges, Kipp is concerned this will have a detrimental effect on the Emirates educational sector.

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December 15, 2010 4:18 by



The National reports that state universities will face a spending freeze in 2011 as the Federal Government runs a Dh3 billion budget deficit in the upcoming year. In contrast to the federal budget for 2010, which was Dh43.6 billion, the projected federal spending for 2011 is expected to be just Dh41 billion – marking a 6 percent cut in spending. What’s more, the budget is to remain the same for the next three years and is part of the first-ever implemented “zero-based” budget, which requires every ministry to justify its expenses before they receive funding.

The United Arab Emirates University’s budget will remain at Dh1.3 billion, with even the Higher Colleges of Technology having their budget frozen at a little over Dh73 million. The HCT’s shortage of cash was the subject of an FNC report this year.

What will the freeze mean for local universities? It is hard to say how much the freeze on spending will trickle down to students through higher fees or less financial aid. As the decision only affects state-funded universities, established privately owned universities like those in Academic City and Knowledge Village should remain in the clear. But government-owned universities like The American University of Sharjah, which has already seen a significant increase in tuition fees over the years (annual fees are now close to Dh75,000), are subject to the freeze, and that probably has students apprehensive.

It could be worse for the universities sector, however; at least their budgets weren’t reduced. A lack of students has already prompted the shutting down of the Dubai branch of Michigan State University this July. The closure of the branch seemed to boil down to bad timing, as it opened two years ago – just before the recession hit. Consequently it found it couldn’t attract enough students; when the branch shut they had just 100 undergraduate students and a dozen graduate students.

That said, the budget measures are tough. They will hopefully increase accountability of UAE universities and encourage wise spending, but they are also likely to hold up the country’s ambition of establishing itself as a leader in the higher education sector – competing with the well established global leaders simply cannot be done on a shoestring.

And even though the likes of the Sorbonne UAE and NYU UAE are arriving with their own sources of funding, they undoubtedly receive some inducement from the government as incentive for starting up here, so it could be that the freeze affects new private institutions as well as public. This seems likely to further jeopardize a promising educational scene.



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