Source document: https://docs-lawep.s3.us-east-2.amazonaws.com/1697751081995.pdf (Georgia)
HIGHER EDUCATION FUNDING IN EUROPEAN NATIONAL POLICIES umaRlesi ganaTleba evropis erovnuli politikis finansirebaSi anna verbicka Cernigovis erovnuli teqnologiuri universitetis aspiranti, ukraina Abstract ANNA VERBYTSKA Postgraduate student Chernihiv National University of Technology, Ukraine Nowadays the majority of European national policies tend to encourage higher education institutions to increase the private sources of funding.
However, direct public funding continues to be a considerable part of the higher education budget.

The paper highlights the methods used to fund higher education institutions in European countries of the Eurydice Network.

The need for longer-term planning and development of strategies for higher education is widely recognised across Europe.
The countries investigated in this paper implement specific policy documents that outline national strategic priorities for ensuring the financial sustainability of the higher education sphere.
Some common medium trends in the variety of countries` policies are determined: increasing public funding for higher education; granting more autonomy to institutions for managing financial resources; establishing direct links between results and the amount of public funding allocated; encouraging the diversification of funding sources as well as the creation of partnerships with research institutes, businesses, and regional authorities.
The methods public authorities use to fund HEIs has been analysed in the paper, as they are likely to significantly influence the institutional strategies.

This paper answer such issue as the public funding of HEIs based on their performance; European public authorities grants for specific higher educational projects; accountability for the public funding.
The following main characteristics of the public funding of HEIs in Europe have been identified in this paper: funding formulas are used almost everywhere in the allocation of public funds; performance indicators based on students’ results are used in funding formulas in the majority of countries; public funding is awarded in accordance with a performance contract in twelve countries; public funds for research are allocated according to various mechanisms.
Key words: higher education, public funding, funding models.

anotacia Tanamedrove pirobebSi evropuli erovnuli politikis umravlesoba, rogorc wesi, ax- aliseben umaRles saswavlo dawesebulebebs finansirebis kerZo wyaroebis gaz rdiT.

miuxeda- vad aRniSnulisa, pirdapiri saxelmwifo finansireba uwindeburad rCeba umaRlesi ganaTlebis biujetis mniSvnelovan nawilad.

statiaSi ganxilulia meTodebi, romlebic gamoiyeneba evro- puli qveynebis umaRlesi saswavlo dawesebulebebis finansi re bisaTvis Eurydice qseliT.
umaRlesi ganaTlebis grZelvadiani dagegmarebisa da strategiis SemuSavebis aucile- blobam farTo aRiareba hpova mTel evropaSi.

qveynebi, romlebic ganxilulia mocemul sta- tiaSi, axdenen konkretuli programuli dokumentebis realizebas, rom lebic umaRlesi ga- naTlebis sferoSi finansuri mdgradobis uzrunvelyofis mizniT gansazRvraven erovnul strategiul prioritetebs.
gansazRvrulia saSualo tendenciebi sxvadasxva qveynebis politikaSi: umaRlesi ga- naTlebis saxelmwifo finansirebis gazrda; dawesebulebebisaTvis meti avtonomiis micema finansuri resursebis marTvaSi; finansirebis wyaroebis diversifikaciis waxaliseba; aseve partnioruli urTierTobebis Seqmna samecniero – kvleviT institutebTan, biznesTan da xe- lisuflebis regionalur organizaciebTan.
22 inovaciuri ekonomika da marTva / INNOVATIVE ECONOMICS AND MANAGEMENT # 2, 2018 naSromSi gaanalizebulia meTodebi, romlebsac saxelmwifo organoebi iyeneben umaR- lesi saswavleblebis finansirebisaTvis, vinaidan isini mniSvnelovan zegavlenas axdenen in- stitucionalur strategiebze.
statia pasuxobs iseT kiTxvebs, rogorebicaa umaRlesi sas- wavlo dawesebulebebis saxelmwifo finansireba maTi efeqturobis safuZvelze, konkretuli saganmanaTleblo programebisaTvis evropuli saxelmwifo grantebi; pasuxismgebloba sax- elmwifo finansirebaze.
mocemul statiaSi identificirebulia evropis umaRles saswavlo dawesebule bebSi saxelmwifo dafinansebis ZiriTadi maxasiaTeblebi: TiTqmis yvelgan gamoiyeneba saxelmwifo Tanxebis ganawilebis formulebi; efeqturobis maCveneblebi, romlebic efuZnebian studen- tebis Sedegebs, gamoiyeneba umetesi qveynebis finansirebis formulebSi; saxelmwifo finansi- reba mieniWebaT xelSekrulebis pirobebis Sesrulebis Sesabamisad Tormet gamokvleul qvey- anaSi; saxelmwifo saxsrebi kvlevebisaTvis gamoiyofa sxvadasxva meqanizmebis Sesabamisad.
sakvanZo sityvebi: umaRlesi ganaTleba, saxelmwifo finansireba, finansirebis modelebi.

Problem statement.

Educational policy is closely related to the economic and social national poli- cies.

Looking for the appropriate education policy model is aimed at the formation of the strategy of countries` development.

The issue of the funding is one of the key ones in the developing of educational strategy.
It in- cludes three important components: quality (correlation funding-result-quality), access (social justice) and effi- ciency (balance between profit and expenses).

Nowadays Ukrainian sphere of higher education exists in the conditions of a lack of sufficient funding.

The experience of European countries in the implement- ing of the efficiency funding models could be important base for the improvement of the national education pol- icy of Ukraine.
The aim of the paper is to provide an under- standing of the national education funding trends across Europe.

Methodology.

The base of the paper is the in- formation from Eurydice European Unit.

The compara- tive analysis was drafted by the expert of European Unit.

The report refers to European studies and scientific pub- lications.

Main material Enhancement of institutional autonomy in managing financial resources.
There is a tendency towards deregulation and more autonomy for higher education institutions regarding institutional pol- icies and, in particular, the management of institutional budgets.

In the majority of countries HEIs traditional- ly operate with a high degree of autonomy, including in financial issues.

European universities were granted full autonomy in the management of their finan- cial resources.
Nowadays the greater institutional au- tonomy has been resulted in a considerable increase in HEIs’ responsibility for institutional policies and clos- er involvement by students and staff in the institutional governance.

Although the majority of European national policies encourage higher education institutions (HEIs) to raise the private sources of funding, direct public funding continues to represent a major part of the higher education budget [1].
Establishing the correlation between results and funding.

Authorities are highly interested in optimising the balance between the financial resources they invest in higher education and the outcomes of the sphere.

They establish funding mechanisms aimed at linking results allocated of the future public funding.

This is usually possible through the budget negotiations between HEIs and the relevant Ministry, as well as by using the funding formula that include performance indicators.
The peculi- arities of such policies in the selected European countries are in the table 1.
Table1 Establishment of the funding policies based on the results Country Romania Year of establishment 2008 France 2006 Finland the mid of 1990s UK 2008 Norway 1990 Policy`s scope The policy is included in long-term strategy for the development of higher education The law on public finances reinforced the links between higher education funding and results based on objectives and indicators Institutional objectives and the resources needed to achieve them are determined in negotiations between the Ministry of Education and each HEI Funding to support the research infrastructure is distributed selectively, informed by assessment of research quality The government’s priority is to further refine funding arrangements for HEIs and is geared towards rewarding achievements and results while safeguarding important but vulnerable academic areas and activities The table has been completed by the author based on [2].
23 inovaciuri ekonomika da marTva / INNOVATIVE ECONOMICS AND MANAGEMENT # 2, 2018inovaciuri ekonomika da marTva / INNOVATIVE ECONOMICS AND MANAGEMENT # 2, 2018 Partnership and connections with society.

Governments encourage the development of closer relations between HEIs and society.

Policy measures in this area are aimed at the promotion of the scientific results.

However, the link between research and national economic (includ- ing specific regional needs) is a priority.
The European authorities promote co-financing and the creation of the partnerships “HEIs- research institutes-regional author- ities-business”.

Moreover, in some countries (Estonia, France, Italy, Portugal, Finland and Sweden) they pro- vide financial and other mechanisms to support such co- operation [1].

The block grant.

The block grant is divided be- tween the categories of expenditure of the institution.
In Belgium, Ireland, France, Lithuania, Hungary, Poland and Slovenia, institutions receive block grants and they must spend them in compliance with the budget headings submitted to the funding body.

In France, HEIs must sub- mit the budget proposal to the authority.

HEIs in Poland have to submit their proposed financial activities to the Ministry of Finance but there is no institutionalised au- thority for their approval.
In Hungary, institutions have to send an annual draft budget proposal to the supervisor.

The supervisor may initiate amendments, if he considers that the proposal does not allow the institution to achieve its basic goals.

The block grants are intended to cover learning process and operational expenditure.

In rare cases, staff salaries may be covered.

In half of the coun- tries, block grants may fund research expenditure.

The block grants do not constitute the only source of public funding.
In all countries, HEIs receive public funding for specific purposes, such as national programmes, social purposes, particular research, etc [3].

Funding formulas.

Funding formulas promote the increasing of the transparency of public funding.

It helps to avoid potential political pressures.

Almost everywhere, funding formulas rely on input criteria, which refer to the institutional activity [4].
Institutional activities may be estimated according to the resources (number of staff and students, staff salaries, campuses and buildings, etc.)

available to HEIs.

In many cases, the funding formulas also include performance criteria, which are related to the outputs achieved by an insti- tution over a previous period.

In the funding formulas, the input-related criteria depend on countries.

The most commonly used criterion is the number of students reg- istered during the previous or current year.
Characteris- tics other than those relating to the number of students, which may sometimes guarantee certain stability in the allocation model, are considered much less frequently.

They include, for example, variables associated with the cost of college (Finland), the area of buildings (France), number of employees (Greece, France, Poland - public institutions - and Portugal) and criteria related to educa- tional provision (France and Slovakia), etc.

[5].

Performance indicators.


Approximately half of the countries use performance indicators which focus on student success rates.

The most common performance in- dicators for teaching activities focus on student success rates that are measured through the number of graduates.

Indicators in the Czech Republic, Italy and Austria have 24 special importance to compliance with the standard peri- od of time needed to complete courses.
Some countries use other indicators related to student success rates (in addition to the number of graduates for some countries).

In Denmark, Austria and Liechtenstein, the number of students who pass their exams is considered.

The num- ber of credits earned by students is considered in Sweden and Norway.

In the United Kingdom, the number of stu- dents registered is not considered in the funding formu- la; only those students who complete their year of study.
The number is weighted according to field and type of study.

For institutional performance, Italy and the Neth- erlands consider the failure rate at the end of the first year and the number of students who abandon their studies, respectively [6].

Models of public funding: issues and challeng- es.

The mechanisms of public funding for higher edu- cation in Europe represent levers through which central governments pursue their strategic objectives in the sec- tor.
The usage of funding formula is very widespread.

Various aspects of these models are discussed.

Funding formula based on the number of students may act as a drive to rationalize the usage of resources.
According to Salmi and Hauptman, “when the costs per student are based on the average costs at the national level or on the normative costs established by considering various pa- rameters that are used to calculate the cost of research, it should be in an ideal situation, rather than what they real- ly are” [6].

The funding formula based on the number of students enrolled makes institutions vulnerable to fluctu- ations in student enrolment, which inevitably has a direct impact on their revenue.
Some basic institutional costs cannot be reduced from one year to the next.

In order to deal with this situation, institutions may adapt the types of programme offered to match students’ preferences in order to attract more students [7].

Although this strategy may guarantee that the courses correspond to the short- term needs of society in terms of education, it may also lead to a limited diversity of courses and the disappear- ance of certain important but less popular academic dis- ciplines.
In light of this, funding formulas could include incentives to preserve vulnerable academic disciplines.

Conclusions Nowadays public funding of higher education is the dominative mechanism in majority of countries.

There is a wide range of private sources for higher ed- ucation funding.

The task of HEIs is to investigate the potential ways of private funding.
The task of the nation- al policy is to find a balance between the optimisation of the expenditures on higher education sphere and the obtaining of long-term benefits.

Autonomy of financial management is a key as- pect in higher education governance for Ukraine.

Public funds allocated for the specific research projects in con- nection with the national purposes exists as a form of management by objectives.
At European level, there is rarely a strong correlation between a liberal policy in the field of diversification of financing by the private sector and the development of a range of incentives in this area.

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