Mon | Sep 27, 2021

Editorial | UWI report needs to be tabled in Parliament

Published:Friday | March 5, 2021 | 10:29 AM

Vice-Chancellor Sir Hilary Beckles’ broad outline of his alternative vision for staving off insolvency at The University of the West Indies (UWI) is a welcome development that adds weight to this newspaper’s call for a robust debate about the future of the regional institution, including how it is managed and financed.

For, while Professor Beckles did not say so directly, his remarks this week were in direct response to the findings of a commission of governance at the university, commissioned by the chancellor, Robert Bermudez. The commission recommended that UWI students be asked to pay 40 per cent of the economic cost of their education, instead of the notional 20 per cent at present. In his pushback against this suggestion, the vice-chancellor was at once relevant and emotive. Seventy-five per cent of the UWI’s students, he said, were from working-class families, the implication being that higher tuition and other fees would deprive many, if not most of these students of a shot at university education.

Except that doubling these costs was not a bald suggestion by the commission, which was chaired by the former president of the Caribbean Court of Justice, Dennis Byron, and included luminaries such as the governor of Jamaica’s central bank, Richard Byles, and Sir Hilary’s predecessor as vice-chancellor, Professor Nigel Harris. Higher fees, for instance, would be underpinned by improved access to students’ loans, and the servicing of the debt would be related to borrowers’ ability to pay. In any event, the commissioners themselves suggested that their funding model be “subject to a more rigorous examination and modelling, to determine with more confidence the most optimal cost-sharing ratios and most viable characteristics that will make the model as affordable as possible, both to governments and prospective students”.

INSTITUTIONAL GOVERNANCE

Moreover, as significant – existential even – as the question of the funding model is to The University of the West Indies, an equally critical element of the report has to do with the UWI’s institutional governance: the way it is managed. The conclusion in this regard was that it is hidebound, inefficient, unaccountable and unresponsive.

This ought not to be interpreted as pointing fingers at the incumbent leaders. For if it were, Professor Harris, who was vice-chancellor for a decade up to 2015, would, as a member of the commission, have to recognise that he could not escape blame. The governance structures, of rigid bureaucracy and opaque systems, have, but for sporadic tinkering at the periphery, remained largely the same since the university was established nearly 73 years ago.

There is a sense that Mr Bermudez, who came to the chancellorship neither from academia, the professions nor the public bureaucracy, but from the rough-and-tumble world of business, wants to shake up things – propelled by the financial crisis facing the UWI.

In 2018-19, the latest period for which the university’s summary consolidated financials are available, the UWI ran a deficit of BDS$91.2 million. The year before, the deficit was BDS$93.5 million. Between 2015 and 2019, the institution’s revenue slipped nearly four per cent, or BDS$37.6 million, to BDS$$925.8 million. The decline in 2019 was BDS$39.5 million, or approximately 4.1 per cent. However, the expenditure was roughly the same in 2019 as the year before.

DOUBLE WHAMMY

The university has faced a double whammy – governments and students who run up arrears.

The faltering economies of its Caribbean government owners rendered them unable to meet their agreed financing obligations. With the 70 per cent financing essentially out the window, most governments make block grants to the university. In Jamaica’s case, the J$9.2 billion the Government has allocated to the university in its 2021-22 Budget is the same as the previous year’s. And the 32 per cent rise in the allocation against 10 years ago means that Jamaica’s funding to the UWI lagged the island’s inflation.

Indeed, in recent years, the contributions of governments to the university’s income has hovered between 45 and 46 per cent. With respect to the Mona, Jamaica campus, the island’s Government pays less than a third of the campus’ bill. On the wider plane, governments have run up large arrears, much of which the university has had to write off as impaired. The same has happened with students. In 2019, the net students’ debt was Bds$40.2 million, after the BDS$51.7 million marked as impaired.

In the circumstances, the university’s composite financial index (CIF), the matrix often used by not-for-profits to measure their financial health, fell to minus 1.21, where 3.0 is considered to be the ballpark of reasonable financial health.

NEW FUNDING MODEL

It is against this backdrop that the Byron commission proposed a new funding model for the UWI, of which the hike in students’ fee was a part. Concomitant with a change in the financial arrangements, it said, must be an overhaul of the governance mechanisms: “Importantly, in terms of equity, and before any new funding model is subscribed, the university must demonstrate moral and fiduciary responsibility, and ethical guardianship in its effective and efficient use of institutional resources. Further, it should clearly show how these resources are being maximised to increase the greater good of Caribbean society.”

Sir Hilary’s economic recovery plan includes cutting spending and increasing income by 10 per cent over two years. Over the longer term, it also proposes to increase income from academic and entrepreneurial ventures, including expanding on foreign partnerships, the approach to some which gained a quizzical eye from the commission. Notably, also, the vice-chancellor expects that governments will contribute 50 per cent of the UWI’s income, seemingly reversing the trend of recent years.

The report, and Sir Hilary’s response, demands a full debate. They should be tabled in the House and sent to a parliamentary select committee for hearings. Fayval Williams, the education minister, and Nigel Clarke, the finance minister, should see to this. Or Prime Minister Andrew Holness.