PERFORMANCE-BASEDFINANCING IN CHILE: RELEVANT RESULTS

Ricardo Reich, Consultant Division of Higher EducationMinistry of Education of Chile

Santiago, Chile, September 2015

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TERTIARY EDUCATION PRESENTATION

• 1.215.413 students in tertiary education• 162 institutions

o 25 universities in CRUCH; 16 State y 9 private o 35 private universities, since 1980o 44 professional institutes (non-degree granting)o 58 vocational centers (CFT)

• 1.168.607 undergraduate students, 46.806 graduates (4%)o 58% universitieso 57% 1st year enrolment in vocational centers

• Public financing in TE: 1 % GDP (2013); 0.45% (2005)• Student coverage in TE (18-24 years): 39% net; 66% of student

enrolment• Public financing in R&D: 0,4% GDP!! • Tuition and fees (> US$ 3.800/year). National student-aid system:

scholarships and loansSource: SIES (Higher Education Information System, Ministry of Education), 2014

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FINANCING OF HIGHER EDUCATION AND INSTRUMENTS

GASTO PUBLICO EN EDUCACION SUPERIOR COMO PROPORCION DEL PIB

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• El gasto en Educación Superior que realizará Chile en proporción al PIB el 2013 es superior a la proporción del PIB que países como Estados Unidos, México y Portugal destinaban a este ítem el 2009.

STATE EXPENDITURE IN HIGHER EDUCATION AS % OF GDP (2009)

2013

In the last decade, the State has more than doubled its support to Tertiary Education, as % of GDP

Gobierno de Chile | Ministerio de Educación 5

0,45%

1,04%

2005 2013

HIGHER EDUCATION BUDGET. 2013

• Total Investment: 2,5% GDP. (1,6% is Average OECD)• State Support: 1,04% (1,1% is Average OECD)

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HIGHER EDUCATION FINANCING

2013: MM$ 1.052.803

TE FINANCING IN CHILE2000-2014

Research ResearchCONICYT2000-2015

Supply-side:

Basal funding to institutions

Demand-side:

Student Aid (MORE

scholarships and loans)

National Accreditation System, CNA

historical distributionby law

no accountability

MECESUP AIF

2000-2014PAgreement

Pilot2007-2010

PA Scale-up2012-2016

competitiveresults-oriented

increased accountability May change to partial

or total gratuity!

Basal by Basal by LawLaw

Formula Formula with with

PerformancPerformancee

AIF and AIF and Performance Performance Agreements Agreements

1. Direct State Support 95%. 1. Direct State Support 95%. CRUCH CRUCH 3. Indirect State Support. CRUCH3. Indirect State Support. CRUCH4. Special Support U. de Chile4. Special Support U. de Chile

1. Direct State Support 5%. 1. Direct State Support 5%. CRUCHCRUCH2. Academic Remedials. Q1&Q22. Academic Remedials. Q1&Q23. Strengthening CRUCH. Q1&Q23. Strengthening CRUCH. Q1&Q24. Basal Funding. CRUCH 4. Basal Funding. CRUCH

1. PA Humanities&Social Sciences1. PA Humanities&Social Sciences2. PA New Teacher Training2. PA New Teacher Training3. PA Undergraduate Curricula 3. PA Undergraduate Curricula 4. PA Internationalisation of Ph.D.4. PA Internationalisation of Ph.D.5. PA Vocational Education5. PA Vocational Education6. PA Regional Institutions6. PA Regional Institutions7. PA Innovation (from R&D)7. PA Innovation (from R&D)8. Small Projects AIF28. Small Projects AIF2

MANAGEMENT BY RESULTS

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FINANCING OF HIGHER EDUCATION

TRANSFORMATION OF FINANCING MECHANISMS IN CHILE

PBA AIF2

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PROGRAM MECESUPACADEMIC INNOVATION FUND PERFORMANCE AGREEMENTS

supportive regulatory framework

autonomy academic freedom

leadership team strategic vision

culture of excellence

public budget resources endowment revenues

tuition fees research grants

donations

students teaching staff researchers

graduates research output

technology transfer& innovation

WCU

FAVORABLEGOVERNANCE

ABUNDANT RESOURCES

CONCENTRATION OF TALENT

Source: Salmi 2009Note WCU= Word-class University

International Quality

MECESUP PROGRAM2000-2016

INTERNATIONALIZATION

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THE MECESUP PROGRAM1999-2016

• Phase I. Recovery of academic infrastructure and capacity building• Competitive Fund (CF). 1999-2004

• Phase II. Academic innovation and results • Academic Innovation Fund (AIF). 2006-2010• Performance Agreement (PA) Pilot. 2007-2010• Performance Agreements in the Humanities, Social

Sciences and Arts. 2010-2016• Phase III. Institutional change management

• Performance Agreement Scale-Up. 2012-2016• Upgraded AIF2. 2012-2016

Pilot

1999 – 2000 – 2001 – 2002 – 2003 – 2004 – 2005 – 2006 – 2007 – 2008 – 2009 – 2010 – 2011 – 2012

Phase I. MECESUP 1(Loan 4404 – CH)

Phase II. MECESUP 2(Loan 7317 – CH)

Academic Innovation

Fund(AIF)

CompetitiveFund

Performance Agreement

Pilot

Performance Agreements in

Arts, Humanities and Social Sciences

Academic Innovation and Results

MECESUP1&2 PROGRAMS

Academic Infrastructure and Capacity Building

Competitive Academic Innovation Fund

1999-2008 CompetitionsPROPOSAL ALLOCATION

• 9 calls. US$ 450 millions• 1821 proposals presented• 33 universities. 28 CFT & 2 IP • 769 proyects allocated; approval

rate, 42%:• 439 undergraduate, 57%• 181 graduate, Ph.Ds, 23%• 104 technitians, 14%• 45 management, 6%

• Average project size: US$ 590,000• Implementation: 1-3 years

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ADJUDICACIONES DEL FIACDISTRIBUCION GEOGRAFICA

30<=MECE<3930<=MECE<39

30<=MECE<39

AIF 1999-2008 70% of projects allocated in regions, outside the

capital

MECESUP AIF SUSTAINED $ ALLOCATIONS GRANT CALLS 1999-2008

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PBA pilot2007-2010

US$ 20 million, 3 years

AIF2 &PA scale-up2012-2016

to US$, multiply x2/1,000,000

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PRESIDENT

Academic VP Research&PG

Finances Outreachto Society

International Relations

Teaching-Learning Units

Institutional Research Units

Staff DevelopmentInformation&Kowledge

Remedial ProgramsCurricula Innovation

Tecnology IntegrationInfrastructure Improvement

Student MobilityECTS-Chile

Valorization of Research

Results Unit

Strategic Planning

Educational Model Towards InnovationDevelopment Plan

Support to Local Ph.D. Programs

ScholarshipsInstrumentation

International-ization

Outreach

M&E Actions&ResultsSupport Governance,

Planning andDecission Making

Performance Indicator Management and

Benchmarking

Quality-Teaching Efficiency-Mobility-Employability

Quality. Act 20.129 Equity in

Access to Quality

Sustainability. 1999-Today

AIF

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THE CHILEAN PH.D. PROGRAMSAN OUTSTANTING OUTCOME

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2000 2010 2013

N° Programs 62 195 233

Full-time faculty 7.400 11.005 14.880

Full-time faculty with a Ph.D.

2.200 4.040 5.609

Student enrolment 1.053 4.055 4.653

Student graduation 157 433 602

Graduation/million inhabitants

10 25.5 34

AVAILABLE TALENTSIN CHILEAN PH.D. PROGRAMS

3.409155%

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THE CHILEAN PH.D. PROGRAMSRESEARCH OUTPUT

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THE CHILEAN PH.D. PROGRAMSOUTPUT IN TOP10% OF USA

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THE CHILEAN PH.D. PROGRAMSRESEARCH CITATION IMPACT

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THE CHILEAN PH.D. PROGRAMSINTERNATIONAL COLLABORATION

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RESEARCH AND DOCTORAL STUDIES AT UNIVERSIDAD DE LA FRONTERA

AN OUTSTANTING OUTCOME

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RESEARCH OUTCOME OF UNIVERSIDAD DE LA FRONTERA

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PH.Ds IN NATURAL AND MOLECULAR BIO-SCIENCES

QUALITY OF OUTPUT

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PH.Ds IN NATURAL AND MOLECULAR BIO-SCIENCES

QUALITY OF OUTPUT

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Phase III2008-2016

Performance agreement scale-up Academic Innovation Fund upgrade (AIF2)

New Teacher Training Undergraduate Curricula Reform

Internationalization of PhD´s Support to Vocational Training

Support to Regional HE Innovation in Higher Education

2012 – 2013 – 2014 – 2015 – 2016

Performance Agreement Scale-up

2012-2016

MECESUP 3(Loan 8126-CL)

Management by Results

AIF2Small Projects

(upgraded)

AIF and PERFORMANCE AGREEMENTSCompetition, Pre-Selection and Negotiation

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EXPECTED RESULTS OF NEGOTIATION

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EXPECTED OUTSTANDING OUTCOMESBASE VALUES AND TARGETS

(EXAMPLES)

• Professors with PhD and researchers: head count & % full time

• First year student retention• Low income student retention and graduation• Undergraduate graduation and time-to-graduation • Enrollment and graduation of Chilean and foreign

students in PhD programs• Student and professor proficiency in English • Teaching and research publications & citations• Valorization of academic results for innovation;

Ministerio de Educación - DIVESUP

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IMPLEMENTATION STRATEGIESRELEVANT RESULTS

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COMPETITIVE FUNDING IMPLEMENTATION STRATEGY

• Generate equal opportunities in access to funding• Introduce strategic planning and management by results• Induce changes with (competitive) incentives:

• World Bank Loans 4404-CH, 7317-CH, and 8126-CL combined with

• Incremental state budget• Trust institutions, their capabilities, ideas, strategies• Assure transparency and generate credibility• Act pro-actively and facilitate change• Invite institutional shared funding for greater impact• Increase M&E requirements towards useful results,

outcomes and accountability • Implement changes gradually! Pilot and replicate!

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AIFACADEMIC OUTCOME SUMMARY

• Mecesup’S AIF has been a succesfull instrument and implementation story

• It has been very useful and flexible for many types of institutional quality improvement changes that can be generated by academia bottom-up

• Not so useful for the solution of complex or strategical institutional problems that require top- bottom design, determined decission making, successful negotiation with funding agency and academia, and good and effective leadership

• MECESUP was implemented step—by-step, starting with pilots and then scaled-up

• Main agency efforts were placed on student learning and institutional project facilitation

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AIFMANAGEMENT INTERVENTION SUMMARY

• Incremental financing• Competitive and performance-based funding• As eligibility requirements:

• Quality assurance: accreditation• Institutional strategic planning• Educational model definition

• Management by results• M&E based on project progress and relevant

performance indicators• Teaching-Learning Units• Institutional Research Offices

Division of Higher EducationContact:Dr. Ricardo ReichTeatinos 20, Piso 2Santiago, Chile

Phone: 56-2-22406-6815E-mail: ricardo.reich@mineduc.cl