Public/private funding of higher education: a social balance

1 Public / private funding of higher education: a social balance | Abstract The aim of this project was to provide information on the distribution of teaching-related costs of higher education between the public (i.e. the state) on the one hand and the private households on the other, taking all items of public support to households into account and distinguishing by socio-economic background groups. This information could then be used for discussions on European social policy in higher education and on the impacts of different cost-sharing approaches on widening access and supporting talented students. The study therefore followed a twofold approach: On macroeconomic level, the differences between cost-sharing scenarios were compared between countries; in this, all items of public support to students and their parents that are linked to student status were taken into account. On microeconomic level, the focus was on the differences in a student’s income, expenditure and public support by housing situation (living with parents or away from home) and socio-economic status group (SES). These analyses were carried out for six countries from all corners of Europe representing different approaches of support: the Czech Republic, England, Germany, the Netherlands, Norway and Spain. The macro analysis has shown that the private share is markedly higher in England and Spain (64% and 60% respectively) compared to the other countries (41% 48%) where, in turn, the public share is higher. When looking only at the share taken over by the state (excluding any spending on research), the teaching allocations make up different proportions within this share: In Germany, the share of teaching allocations within public spending is much smaller than in the other countries, and Spain has the highest share. In turn, this means that the share of public funding made available in the form of support to students and their parents is very high in Germany and very low in Spain (note that this does not refer to the total amounts spent, but only to the respective shares). The types of support offered to households can be split into three: support to students in cash form (e.g. grants), support to students in non-cash form (e.g. in the form of subsidies to students’ transportation), and support geared at the students’ parents (in the form of benefit payments or tax relief ). In Spain and Norway, only cash support to the students plays a role, non-cash support also accounts for a certain share in the Netherlands and England, and the Czech Republic and Germany rely on all three types of support. In Germany, the share of support to the parents is higher than the other two support types, which raises the question if this indirect way of supporting students is quite appropriate with regard to targeted steering. When looking at overall funding per student (referring to purchasing power standards), Norway and the Netherlands spend less, and Spain and the Czech Republic spend more than the average for the six countries. The total spending is about average for England and Germany; but in England, the levels of public and private funding show great differences compared to the average. On micro level, eight student groups were distinguished: Students were differentiated by living situation (at home or away from home), and for each of these scenarios, four sub-cases differentiating by SES were considered. To make sure that the results could be compared between countries, only those students that could be considered “normal” in all countries e.g. in terms of their age group were taken into consideration, and it was assumed that their family situation was the same throughout (e.g. unmarried, both parents married, alive and living together). On the whole, living away from the parents is the most common form of student living. It is hardly sur-