By Dr. Lim Teck Ghee, Director CPI

Where is the public money for R&D going?

The following recent article caught my attention: “Universiti Malaysia Pahang has invested RM5 million in a state-of-the-art central laboratory that will focus on developmental research and industrial collaborations …. On financial grants for researchers, Prof Daing Nasir [Vice Chancellor] said they were entitled to a sum of up to RM40,000.” (The Star, 5 November 2009)

Whilst UMP is to be congratulated for having secured generous public funding, the article also raises a number of questions that are of interest to the public in view of the recent concerns raised by the Auditor General’s report focusing on irregularities in the procurement process and supply of equipment at illogically high prices.

These questions include:

• What is the selection process used to determine investment in R & D in the country’s universities?

• Is there a fully competitive, transparent and accountable process in determining which universities/individuals receive funding?

• Who are involved in the selection process and how rigorous are the selection procedures at the university and individual researcher level?

• How is the monitoring of the scientific and commercial outcomes and deliverables conducted?

• What has been the return on investment in the R & D allocations to date?

• Are there issues related to leakages, wastage or inefficiencies of the allocations?

• Are reforms necessary in the way public funds are being disbursed for R & D in the universities?

Who has benefitted from massive R and D allocations?

These questions are applicable not only to the universities but also to all the privileged institutional recipients of public funds for R & D. If these questions are not asked and answered then the danger of such allocations becoming part of an unaccountable public gravy train rapidly going downhill is going to be very real, if it has not already happened. We know that closed non-competitive tenders have for a long time been the norm in the Government and that this has led to cronyism and corruption on a massive scale. Is this also the case with R & D allocations?

These questions are more urgent now in view of the substantial increase in public funding for R & D. With the quantum increase comes also an increase in the scope for possible abuse. The allocation provided to UMP of $5 million is just a miniscule part of the allocations provided in the past decade for R & D, much of which has gone to the public universities.

Budget for R&D (9th Malaysia Plan)

Increased expenditure on biotechnology initiatives

Note: It cannot be ascertained whether these figures overlap or not.

According to the 9th Malaysia Plan document, RM574.4 million was allocated between 2000-2005 solely for biotechnology initiatives with the allocation soaring to RM2.02 billion for 2006-2010 (Table 6-3, p.168). How much of this went into R and D specifically allocated to the public universities is not easy to work out. Other data in the 9th Plan document indicate that sectors other than biotechnology also received similarly generous support. Though it is not possible to compute the exact allocations provided to public universities on the basis of currently available data, there is some evidence that the sums are not small or inconsequential.

In the year 2005 alone, for example, public expenditure on R and D was estimated at RM1.5 billion (Table 12-1, p.264). At the same time, the Intensification of Research in Priority Areas (IRPA) programme funding mechanism approved RM837 million to fund 2,139 research projects (Table 12-2, p.265). Finally, it should be noted that the total development expenditure and allocation for science and technology and innovation for the period 2001-2010 amounted to RM8.59 billion! By way of comparison the sector budget for housing – a basic need in short supply for millions of poor Malaysians – was only RM17 billion for the same period.

Marginalized private higher educational institutions

Questions of how much funding allocation has gone to the public universities for R and D; the impact of these allocations; and related issues of possible leakages and inefficiencies are not the only ones that should receive scrutiny. The treatment meted out to the private higher educational system in the allocation of R & D funding also deserves re-examination.

Despite the role of the private higher education system in providing higher educational opportunities to a very large number of young Malaysians, it is a well known – though not widely discussed – fact that the private system is discriminated against in the higher education policies of the country.

Lack of support or discriminatory treatment of the private universities is manifested in many ways including in the array of unnecessary or unreasonable administrative requirements and processes, delays in government approval of courses, over stringent requirements relating to teaching permits, the accreditation process and other important areas.

One of the most important areas of policy discrimination is the lack of equitable access of the private universities to the public expenditure on R & D. Discrimination against private universities or bias in favour of the public universities takes the following forms.

• Most selection committees for R and D funding are dominated by public sector officials, including representatives from the public universities

• Private universities receive little or no support for the construction of research laboratories or other similar infrastructure such as that provided for public universities.

• Academic staff from private universities are not available for the same generous public sector scholarships or leave time to undertake post-graduate studies.

• This anomaly is found not only in the field of science and technology but also in the social sciences. For example, millions of dollars of public funds have been lavished on various special programmes and projects benefitting primarily researchers and staff of Universiti Kebangsaan Malaysia.

Perhaps the most distressing development in this sorry state of affairs is that students in the private sector universities appear to be subject to the same discriminatory treatment that their lecturers and professors are subject to. Not only are these undergraduates not subsidized by public funds in the same way in which students in the public universities are in terms of tuition fees but they are also excluded from funds allocated for undergraduate research, etc. Such institutionalized discrimination going all the way down to the undergraduate level is deplorable and cannot be justified in any way.

We are fully cognizant that the development of the private higher education industry has not taken place solely due to altruistic reasons of wanting to spread knowledge or education. Nor are our educational entrepreneurs engaging in some kind of national or personal mission. The same may be said about the public higher education system even though its mission statement is more couched in the spin of serving national development objectives.

The owners of the private education industry in Malaysia are in the industry to generate profits for themselves and their shareholders. In the process of running a business and profit making, let us not forget that these entrepreneurs have taken enormous risks and also helped hundreds of thousands of young Malaysians who for various reasons were not able to find admission into the public universities. They are also responsible for attracting a growing number of international students to Malaysia; they pay taxes on their profits and they generate much needed income and jobs.

Level the playing field

At the same time as providing private educational institutions fair and equitable scope to expand, it is also necessary for our policy makers not to marginalize or discriminate against them especially in the vital area of R and D support and training.

It is not simply the interests of the owners of capital that will be served by fair government policies. Many tens of thousands of capable academic staff members and undergraduates of these institutions – some of them with higher research potential or capability when compared with their counterparts in the public universities will benefit – and when they benefit so too will the nation.

Most academic staff members from private universities already experience inferior service conditions compared to their counterparts from the public universities. These differences in job security, remuneration, leave and other career provisions could be made more bearable if they were provided equal opportunity to public funds for R and D. By way of example, it should be emphasized that many private universities elsewhere in the world routinely receive huge grants from Governments on the basis of competitive bidding.

A new policy that provides an even playing field for staff and researchers from public and private universities in R and D needs to be urgently implemented if the country is to fully harness and optimally utilize its higher level human resources.

This new policy needs to be based on principles of competence and performance. It should not be based on non-transparent politicized agendas of exclusion or whether the institution or individual is from the public or private sector higher education institution. When is this long overdue policy reform coming?

Note: This is the first of a two part commentary. The second will provide proposals for policy reform of R & D and private higher educational institutions.