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Malaysia: two-year moratorium on private HE

Malaysia has announced a two year moratorium on new private tertiary institutions with the aim to raise its status as an educational hub. “Highly rated” foreign campuses are exempt from the freeze.

With over 400 institutions, a moratorium could be the start of a consolidation process to increase efficiency

Currently there are 414 private colleges in the country, plus 37 private universities, 20 university-colleges and seven foreign branch campuses. Some private institutions have fewer than 500 students making them unsustainable, Higher Education Minister Datuk Seri Mohamed Khaled Nordin said last week.

He said that there were enough HE institutions in the country to meet local and international demand.“To us, 414 private colleges is a lot. If too many institutions have small student numbers, we’ll face a lot of problems, including these institutions closing down … and their incomes will be affected.”

“If too many institutions have small student numbers, we’ll face a lot of problems, including these institutions closing down”

He added that it was better that the institutions already established “concentrate on their quality and make sure they are the only current players”.

The moratorium will not affect foreign branch campuses that “rate highly in international rankings”, institutions whose applications are currently being processed, or existing institutions that have applied to upgrade their status.

Professor Christine Ennew, provost of the University of Nottingham Malaysia Campus, says exempting “highly rated” foreign institutions is consistent with the government’s desire to drive up quality and develop Malaysia’s position as an international HE hub. The country currently hosts more than 86,000 foreign students, a number it wants to grow.

“Encouraging development at the prestige end of the market will strengthen Malaysia’s attractiveness to international students and I would see this as an attempt to encourage competition based on quality and value rather than just price,” she told The PIE News.

Mohamed Khaled said the ministry would also conduct an annual audit on 10 private universities and university-colleges to ensure they were meeting standards. “The over-dependence of tertiary institutions on government grants has resulted in a phenomenon where institutions are not cost-efficient and failing to be independent and competitive,” he said.

Ennew agrees that with over 400 institutions, a moratorium could be the start of a consolidation process to increase efficiency and enhance the student experience. But, she says further policy intervention may be needed to encourage significant changes.

The moratorium will not affect foreign branch campuses that “rate highly in international rankings”

The government has announced that it will carry out a review of the legislation that governs the establishment of domestic and foreign private HE institutions, the Private Education Act 1996, starting next month to be completed by the end of the year.  It will also launch a study on the higher education financing system in March.

Mohamed Khaled  called for a new model for the national loan granting body the National Higher Education Fund Corporation (PTPTN), “to ensure it remains sustainable without abandoning the policy of equity in education”.

This is not the first moratorium the government has placed on educational programmes. On May 1, 2011, the ministry imposed a five-year moratorium on new medical courses and it froze the setting-up of new private nursing colleges and diploma programmes in nursing in July 2010.

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