The number of high school graduates dropped 15 percent from 2000 to 2005, making it impossible for some universities and junior colleges to fill their freshman quotas. A fall in admissions meant a drop in tuition fees ― the main source of revenues for the ill-fated ones.
The situation will worsen if no action is taken because the number is projected to fall 40 percent from 670,000 to 410,000 in a decade. The government has taken little action although it is well-aware of the problem.
The decline in admissions and the ensuing difficulties for cash-strapped schools have come to the fore as a consequence of debate on students’ demand for a 50 percent cut in tuition fees across the board. Belatedly, the government promises to grapple with this problem and push for an improvement in the finances of institutions of higher education.
Hindsight shows that the trouble began in 1996 when private foundations were allowed to open universities and junior colleges when the minimum requirements were met. As a result, the number of universities has nearly doubled from 108 in 1995 to 196 now. Until recently, they had no trouble because they admitted a growing number high school graduates ― half of them in mid 1990s to more than eight in 10 now. But a demographic change is now reducing the number of high school graduates.
Now it is necessary to close private universities and colleges that barely subsist on tuition fees and government subsidies. The government will have to stop subsidizing them if they refuse to start the liquidation process.
One main obstacle, though, is the statuary requirement that residual assets, or those left behind after liquidation, must be turned over to another school foundation or put into the state coffers. To speed up the liquidation process, the National Assembly will have to act on a pending bill permitting foundations that have closed their schools to turn themselves into nonprofit incorporations.
The government will also have to close troubled public universities and colleges or merge them into other schools. They cannot be allowed to remain a bottomless pit for taxpayers’ money.
