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An ever more global market for education and research means universities must take action to remain competitive. The costs of higher education and research have been growing rapidly. This is due to various factors such as advances in the field of technology, particularly ICT and its wider use in higher education and research, a growing participation rate, new societal demands on institutions, rising pension costs and tougher quality requirements. These costs need to be met by additional financing.

Despite the fact that universities are at the centre of knowledge creation and development, which itself is seen as one of the main motors of economic growth, public investment in higher education in most countries remains too low. Massification has often resulted in depressed higher education budgets per student, a handicap in an increasingly global competition. Despite political declarations of intent to increase spending in the field, public expenditure is unlikely to grow significantly and keep up with rapidly inflating costs in the years to come. One of the reasons for this is that higher education and research have to compete with other priorities in public budgets (health, security, etc.).

The recent economic downturn has moreover contributed to further decreases in the levels of investment into higher education and research of many European countries. This is particularly worrisome for universities, which continuing dependence on public funding puts their future sustainability under pressure.

All the above reasons are forcing universities to respond by taking action. The first step is for universities to master their cost structures and identify the real costs of their activities for both internal and external purposes. While calling for vital additional financial support from public authorities, which have a responsibility in the universities’ long-term financial sustainability, universities also need to increase and diversify additional sources of funding.

The design and implementation of higher education funding policy should be carefully calibrated to the needs of the sector in order to improve overall funding efficiency with full consideration for the possible impacts at institutional level.

Since the launching of its Glasgow Declaration (April 2005) – “Strong Universities for a Strong Europe”, EUA has addressed the issues of autonomy, accountability and funding through conferences, workshops, reports and interactive tools. It has been engaging its members in an evidence-based debate on improving university governance and updating funding structures. EUA has been conducting ambitious research in the field notably through its series “Financially sustainable universities”, which analyses and identifies good practice in financial management in universities across Europe. This series includes the following reports:

In 2015, EUA published its work dedicated to the design of sustainable funding strategies, notably exploring the impact of performance-based funding mechanisms, merger processes and excellence schemes on the sector. These are taken up in the report “Designing Strategies for Efficient Funding of Universities in Europe (DEFINE)”.

Public Funding ObservatoryEUA’s activities on funding also include the development of a unique monitoring tool: EUA’s Public Funding Observatory, as well as a platform to exchange views on university funding at European level: the EUA Funding Forum.

Find out more:

European University Association (EUA)

Brussels office:
Avenue de l’Yser, 24
1040 Brussels
Tel: +32 (0) 2 230 55 44

Geneva office:
114, Rue du Rhône
Case postale 3174
1211 Geneva 3
Tel: +41 22 552 02 96