[Asia Exclusive] Hong Wonhwa "Tuition Autonomy and Focused Government Support Needed for Financially Struggling Universities"

Interview with Hong Won-hwa, President of the Korean Council for University Education
Higher Education Financial Issues Are a Key Challenge for the Yoon Administration
Public Education Costs for University Students Lower Than Those for Elementary and Secondary Students
Will Emphasize the Need for Financial Expansion and Investment in the National Assembly
Also Stresses Structural Improvement of Private Universities Facing Closure Crisis
University Autonomy Should Be Respected in Expanding Regular Admissions

Hong Wonhwa, Chairman of the Korea Council for University Education, is being interviewed on the 6th at the Korea Council for University Education in Guro-gu, Seoul. Photo by Jinhyung Kang aymsdream@

Hong Won-hwa, Chairman of the Korea Council for University Education (President of Kyungpook National University), identified the "tuition autonomy," which has been frozen for the past 13 years, as a key issue that the Council must address with the launch of the new government. He stated, "Tuition regulations should be lifted so that universities in the Seoul area can charge more, while government subsidies should instead support universities facing difficulties." There is a growing demand to increase financial support for higher education to help universities suffering severe financial difficulties due to the declining school-age population and frozen tuition fees. Although the seriousness of the problem is recognized by both the political circles and the Ministry of Education, no one has dared to tackle it readily. This is also why the Presidential Transition Committee did not include higher education financial issues in the national agenda.

Chairman Hong believes that if it is difficult to introduce a higher education tax or enact a special law, the government should at least lift the "tuition regulation." Scholarships for low-income students include the National Scholarship Type I (income-linked scholarship) and National Scholarship Type II (university effort-linked scholarship). Hong said, "It's not about wanting to raise tuition freely, but even if tuition is increased only by the inflation rate, it would not need to be controlled under National Scholarship Type II. In the case of Kyungpook National University, the amount tied up by the tuition increase is roughly 10 billion KRW, while the amount received under National Scholarship Type II is about 6 billion KRW," adding, "It is difficult to change the items of government subsidies. Investment in equipment and other areas is also necessary, but under these conditions, investment becomes difficult."

- What is the solution to the tuition increase issue?

△ Article 11 of the Higher Education Act guarantees tuition increases within 1.5 times the average consumer price inflation rate over the past three years. However, in reality, tuition increases are linked to government financial support such as National Scholarship Type II, and universities do not have the autonomy to set tuition freely. This is a situation where what is guaranteed by law is administratively regulated, so improvement is needed. The decline in the school-age population is progressing more steeply. The number of entrants was 420,000 this year, expected to decrease to 400,000 in 2024, and to 280,000 by 2040.

In this situation, private universities face great difficulties in management due to decreased tuition revenue and increased fixed costs such as personnel expenses and administrative operating costs. Related regulations that restrict university finances and operations should be lifted, and indirect expansion of university finances through tax improvements should be supported. The tuition issue also requires social awareness improvement, and discussions will be conducted by communicating with the government, local communities, and the public to explain the realities of universities.

- The saying "The earlier the cherry blossoms bloom, the sooner they fall" is becoming a reality.

△ In the 2021 academic year, the enrollment rate of freshmen within the quota at four-year universities was 90.2%, but there were differences by region. The rates were 95.7% in the metropolitan area, 91.2% in Daegu-Gyeongbuk-Gangwon, 91.1% in Busan-Ulsan-Gyeongnam, 82.2% in Honam-Jeju, and 81.8% in Chungcheong. Some universities fail to fill half of their quotas. A significant portion of government financial support projects is concentrated in metropolitan universities. In 2020, 72.3% of the Industry-Academic Cooperation Foundation account subsidies went to metropolitan universities.

If cherry blossoms fall first in the south, Seoul will eventually fall too. The method of distributing innovation support funds by ranking 200 universities must also change. The same standards should not be applied to universities with over 30,000 students and those with only 1,000 students. Even if base universities are excluded from support, financially struggling universities with innovative plans should be supported first. One approach is to divide groups according to characteristics and provide support accordingly.

Hong Wonhwa, Chairman of the Korean Council for University Education, is being interviewed on the 6th at the Korean Council for University Education in Guro-gu, Seoul. Photo by Kang Jinhyung aymsdream@

- The ‘Special Act on Higher Education Financial Support’ proposed by the Council was excluded from the national agenda.

△ There was almost no mention of higher education in the presidential candidates’ pledges. There are more opponents than supporters of higher education issues because there is no clear answer and it requires a lot of money.

Government investment in higher education relative to the national GDP is very low compared to major countries. Last year, among OECD countries, South Korea was the only one where per-student public education expenditure for university students was lower than that for elementary and secondary schools. Elementary and secondary schools can secure stable finances through local education finance grants, but higher education faces limitations due to irrational resource allocation and annual budget formulation by individual projects. The funding for higher education finance should be stabilized by converting the current education tax into a ‘higher education tax.’ I will emphasize the need to expand and invest in higher education finance to the National Assembly.

- What policies are needed to provide an exit for universities facing financial crises?

△ A president of a local private university even asked how the school could be withdrawn. Some local universities have only 30 professors left due to sanctions and difficulties. Some schools try to hold on until only one student remains. Students may welcome this, but professors and staff face problems. Also, if a school closes, its assets revert to the Ministry of Education, so finding a solution for this is an important task. Based on the regional extinction risk levels of 28 cities and counties, 35 universities are located in 24 regions with high extinction risk. The new government should actively support structural reform of private universities on the brink of closure. For universities that are difficult to revive, a comprehensive management plan for marginal universities should be prepared to provide an exit such as closure and liquidation of remaining assets, ensuring the maintenance of a healthy higher education ecosystem in the region.

- Why is there great interest among local universities in the Regional Innovation Project (RIS) based on local government-university cooperation?

△ RIS has an enormous budget. Including local government contributions, the annual budget reaches 68 billion KRW. Four of the ten regions have not yet participated. Kyungpook National University entered this year after three attempts. The Ministry of Education proposed ‘lifelong education’ as an alternative to the declining school-age population, but lifelong education is not yet a sustainable revenue source for universities. Since RIS aims to achieve regional innovation through university innovation, it promotes university education innovation to nurture talent for key regional industries and undertakes tasks for regional industrial ecosystem development such as technology development and enterprise support led by universities. In Daegu and Gyeongbuk, local governments are required to invest more than 30% of matching funds, and both local governments have submitted commitment letters to actively invest city and provincial funds.

- What is your opinion on the new government’s pledge to expand regular admissions?

△ Some local areas have 100% early admissions, while universities in Seoul are increasing regular admissions. This is intended to select better students, but it should not be viewed negatively unconditionally. Since the situations of metropolitan and non-metropolitan universities differ, it is not desirable for the government to mandate the proportion of specific admission periods or types. Designing and operating admissions fairly so that students do not focus excessively on private education and can enter universities by faithfully completing high school curricula should be prioritized. Given the current conditions where the decline in the school-age population exacerbates difficulties for regional universities, university autonomy in admission design according to their characteristics should be respected even more.

◆ About Hong Won-hwa, Chairman of the Korea Council for University Education

▲ Born in 1963 ▲ Kyungwon High School ▲ Bachelor of Engineering, Kyungpook National University ▲ Master of Engineering, Waseda University ▲ Doctor of Engineering, Waseda University ▲ Regular member of the Architectural Institute of Japan ▲ Regular member of the Architectural Institute of Korea ▲ Regular member of the Korea Institute of Architects ▲ Professor, Department of Architectural Engineering, College of Engineering, Kyungpook National University ▲ Member, Advisory Committee on New Town Construction, Ministry of Construction and Transportation ▲ Associate Dean, College of Engineering, Kyungpook National University ▲ Vice Dean, Graduate School of Industry, Kyungpook National University ▲ Director, Engineering Foundation Division, Basic Research Headquarters, National Research Foundation of Korea ▲ Dean, College of Engineering and Graduate School of Industry, Kyungpook National University ▲ 19th President, Kyungpook National University ▲ 26th Chairman, Korea Council for University Education