Finding the Loch Ness Monster: The Continuing Search for Higher Educational Reform in Greece

Lost in the furor of the general strikes and public reactions against the IMF-led financial rescue package has been the fate of the government’s attempt at higher educational reform. Educational reform is something like the Loch Ness monster of Greece: people have been searching for it for decades, but they have never actually seen it. Every government revisits the issue: Studies are commissioned, consultations are held, laws are passed--yet the problems continue, while Greece continues to lose ground in international comparisons of higher education.

The latest round of tertiary-level policy initiatives by Minister Anna Diamantopoulou build on past attempts by Minister Marietta Giannakou, and include some noteworthy initiatives such as ending (really, this time) the problem of eternal students, devolving decision-making authority to universities and possibly closing or merging university and higher vocational education and training (VET) institutions and/or departments. These are worthy initiatives, but I feel that any solutions they may bring will only temporary, since the core issue of competition, student focus and the public monopoly on higher education is not resolved.

The Greek higher education system is based on the public monopoly on higher education in a variety of ways:

·     The Greek government (via the Constitution) did not, until May 2010, recognise graduates from private post-secondary educational institutions in Greece. There are no fully-functioning private universities in Greece accredited by the government at the tertiary level. The 10 “private” universities which do exist usually specialise in certain limited areas (usually in the liberal arts), and are usually based on provision of foreign degrees. They face continual problems with state validation of teaching staff, curricula and diplomas. Ironically, the Greek government does recognise the diplomas of foreign private universities, while it also permits secondary and primary private education within Greece.

·       The Greek government is responsible for nearly 100% of funding to state universities, which are not allowed to officially charge for tuition or materials. It does not provide any financial support to the private post-secondary, non-tertiary institutions it has recognised.

·      The non-temporary staff in the state system have the status of permanent civil servants. For all intents and purposes, they cannot be fired for any reason except possible criminal behaviour. A large number of temporary staff have been hired to cover shortfalls due to poor performance of the permanent staff. These temporary staff face payment delays, job insecurity and the constant threat of contract termination every time the government changes.

There have been any number of studies from both sides of the political spectrum which testify to the inefficiency and waste of university operations and learning outcomes, which I do not want to repeat here. Interested readers can consult various CEDEFOP and Eurydice studies on higher education, international rankings, the various Lisbon Agenda and Bologna studies carried out by the European Commission, and various reports implemented by the ND and PASOK governments over the past 10 years.

What I would like to do instead is to focus on the fundamental unfairness of the public monopoly on education, and the detrimental effects this has on society. While proponents of free public education claim that a public monopoly is necessary to assure for social justice, the actual record of such a system in Greece leaves much to be desired. Its defenders cannot account for the regular destruction of university property, the low or variable quality of lectures and teaching,  the high class sizes, the abysmal management (many universities apparently do not even know their own enrolment), the sub-standard facilities, the problem of eternal students, etc.

In such a climate, it is also irresponsible to speak of more funding being the solution. There is absolutely no guarantee that reaching the magic number of 5% GDP invested in education will make any difference whatsoever, beyond propagating and exacerbating inefficient and illogical practises.

I would therefore like to suggest the following proposals for the higher education system, which I believe are the only method of addressing the issue of quality in higher education in Greece. These are as follows:

1.     The state monopoly on higher education must end. Each university or vocational training institution which so desires should become a self-managing, legally-independent organisation responsible for its curriculum, staff hiring and firing and enrolment. Those that do not desire this should be closed. Exceptions can be made for a few institutions considered vital for national reasons, such as defence / military-related, fire and police academies.

2.      The state’s role in providing financial resources should switch from funding institutions to funding student enrolment. This funding should be prepared using a lump-sum calculation based on courses of study (e.g. a chemistry major may require higher funding than a literature major). The funding should be paid to the institution based on the number of students enrolled (subject to a maximum cap on student funding and places). The funding will only be available for a studies up to an including a masters’ level, in line with the minimum (not maximum) number of years foreseen per specialisation, e.g. 3-4 years for a bachelor’s and 1-2 years per master’s degree. A separate provision should be made for doctoral and postgraduate work. A limited number of scholarships should be available for international study.

3.      Public universities will be able to levy tuition on students. This should be capped at a logical rate (e.g. EUR 2,000 per year), but grow in line with economic conditions and market competition. A set number of scholarships should be offered based on full or partial scholarships for means-tested families. Scholarships should include a mix of loans, work-study, and grants. Tuitions charged to non-residents of Greece can be set to market rates.

4.     This funding mechanism should apply to enrolment at all accredited “private” (i.e. non-state) and “public” institutions in the country. The difference in status should become one of for-profit and non-profit education, where the former is characterised by a company where profits can be distributed as dividends, and the latter by an institution where 100% of profits made are re-invested into the institution. For-profit education should fall under the standard tax code. Non-profit educational institutions should not be taxed. State funding and scholarships should only be available for enrolment in non-profit educational institutions.

5.   All value-added tax (VAT) on higher education services which comprise study (or provision of study) in full enrolment at a non-profit institution should be set at 0%.

6.   The financial foundation of the new educational institutions should be strengthened by the legal transfer of land, buildings and other assets already in their possession, as well as by the potential transfer of additional state assets (primarily real estate), to form an endowment for future operations.

7.    All educational institutions—and the government—should immediately end the practice of owning and operating student dormitories at no cost to the students. If the cost of housing is an important part of student costs, then either:

• This cost should be covered by scholarship grants or loans or work-study, or
• A stipend should be added enabling the student to rent suitable premises.

In any case, the true financial costs and benefits of student housing (or stipends for housing) should be clearly recorded and understood by all parties involved. Housing benefits should only be provided for the minimum study term: eternal students or students who have finished their study should vacate the premises and make room for actively-enrolled students.  

8.   The government should immediately drop its constant war against the private sector in higher education, and recognise that:

• As taxpayers and legal entities, private companies have equal rights to state companies in the provision of educational services in Greece and the European Union;

• It is morally indefensible to retain a government de facto monopoly in the educational sector given the Greek experience and record in this sector, and given that private taxpayers (either in Greece or the EU) are required to pay for this.

9.   All educational institutions are acknowledged to be self-managing institutions. Decisions on staff performance assessment, staff retention and development, compensation, hiring and firing and other issues is left to the discretion of each institution, but must be based on a professional and transparent code of conduct and operating procedure. The staff working in these organisations should be removed from the list of government employees. The staff “managing” the tertiary sector in the Ministry of Education and its agencies should be refocused and reduced accordingly.

10.  All educational institutions are allowed to raise money for capital expenditure endowments through fundraising. All institutions are allowed to carry out revenue-earning work for non-state employers, providing that this revenue is properly accounted for, and that this does not detract from the core educational mission of the institution.

11.  EU funding absorption should be maximised, with the objective of sending every student outside Greece on an Erasmus or similar scholarship for at least 3-6 months of his/hear career. Further absorption should be used for staff training and exchange, including voluntary rotation within Greece as well as internationally.

12.  A separate accreditation body for higher education institutions should be established, comprising, representatives of educational institutions, employers and other social partners. This should be legally independent and insulated from the corrosive effects of political interference.

13.  Every institution receiving public money will be expected to be manage itself transparently and in line with standard, international professional competency. It will be subject to a full audit each year by at least two organisations:

• A private, internationally-recognised audit firm
• The state audit commission

We strongly recommend that the EU Auditor audits the use of all EU funding in Greece as well on an annual basis. All audits will be published online. Cases of fraud or mismanagement of public funds will be prosecuted quickly to the full extent of the law, and will resulting criminal and civil charges against the individuals committing the crimes. Conviction may also result in a reduction of public expenditure to the institution.

14.  In addition to auditing the use of public funds, the role of the auditors should be to advise on issues such as valuation of land and assets as well as leverage ratios. It is strongly recommended that a medium-term legal cap on borrowing be implemented for each institution to assure it self-sustainability. This cap should be in place for at least 10 years to avoid the syndrome of high debt taken by public and semi-governmental organisations in Greece.

15. The pan-Hellenic university entrance exam should end. This has an important impact on secondary education, which is currently gravely distorted by two phenomena:

• Teaching for the pan-Hellenic exams rather than for the student
• The excessive institutionalisation of cram schools (frontisteria).

There are two potential solutions for university admissions:

1. A pan-Hellenic standardised exam which includes two tiers, basic competencies (mandatory), and specialised knowledge (optional), be implemented. This would be used in conjunction with other admissions criteria.

2. Each university implements its own transparent admissions process.

The fear is that in the latter case, political and financial connections may assure the entrance of well-connected individuals. Unfortunately, given that the pan-Hellenic exam preparation process has also become a process driven by money, it does not seem that the current system is doing any better. Despite this, the distortions on secondary schooling remain.

16.  Each institution is allowed to choose how many campuses or departments to have, whether to invest abroad or in Greece, whether to open multiple campuses, whether to offer many degrees or whether to specialise (e.g. business schools, medical schools). Each institution is able to define whether it will provide vocational or academic degree tracks, providing of course it meets the national curriculum standards in each area.

17.  All ecclesiastical education and training should be immediately devolved. If government funding is to be available to higher or vocational education in religious institutions, then it should be on the same funding basis as other institutions, but should be equally available to the religious institutions representing all religions, not solely the Greek Orthodox religion. There should be a total separation of Church and State in education.

18.  University asylum must end. Every institution can either pay for its own policing, or rely on the standard forces of law and order in certain or all cases. Theft and other criminal acts should be fully prosecuted by the law: students and staff who commit such acts should be expelled.

These proposals are radical in nature, and are not likely to be acceptable to the majority of university administrators, staff and possibly students. Unfortunately, I do not see any long-term alternative. Unless we want to accept continual “reforms” of the system every four years or so, and a continual decline in educational quality, we must sever the connection between the politically-dominated educational policy-making and management process, and the management of higher educational institutions.

This will also be of utmost benefit to the institutions themselves. We know that in order for them to succeed, they must internationalise as rapidly as possible, developing alliances with European and other universities, investing in new facilities, rewarding their staff properly, and developing spin-offs and endowments. If a devolution of the kind I propose occurs, we should be ready to transfer up to EUR 500 million of state land and assets to each institution, assuring it of the means to operate independently. (The Greek government has recorded assets of over EUR 300 billion, most of which is mismanaged. Total government income from these assets amount of less than EUR 50 mln per year).

We also know that given the tremendous debt burden hanging over Greece (itself a product of gross public sector mismanagement and political corruption), there is practically no chance for a real investment in higher education to occur in any other way. To thing otherwise is to dream.

It may be necessary to split such a reform into phases over 10 years: calling for a first wave of volunteers and allowing them to operate for 5 years to see the results. But unless the system changes, the chronic issues of mismanagement and declining standards will continue, while the long-term damage to the society grows. 

(c) Philip Ammerman, 2010