1. University governance in Finland: recent developments and challenges Anita Lehikoinen, director of the Education and Science Policy Department, Ministry of Education, Finland 29 October, 2010

2. Minister of Education and Science Minister of Culture and Sport
State Secretary
Minister of Culture and Sport
State Secretary
Internal Audit
Permanent Secretary
Communications and Public Relations
International Relations
Department for Education and Science policy
Department Office
General Education Division
Vocational Education Division
Division for Higher Education and Science
Higher Education
Research
Department for Cultural, Sport and Youth policy
Division for Cultural Legislation and Finance
Division for Art Policy Cultural Export and Exchange Unit
Division for Cultural Policy Copyright Unit
Sports Division
Youth Policy Division
Administration Department
General Administration Division
Human Resources Division
Financial Planning Division
Financial Administration Division
Information Management Division
May 2010

3. Themes of the Presentation
Higher Education system in Finland
Structural Development of Higher Education
University Reform
Steering and Funding of Higher Education Institutions
Science Policy

6. The Finnish Higher Education System
The Finnish higher education system comprises two parallel sectors:
University sector
16 research universities, including 4 Universities of Arts
Student enrollment
All institutions run by the state
Polytechnic sector (established in the mid-1990s)
25 institutions
Student enrollment
Institutions partly funded by the state, partly by municipalities
Regional development tasks
Bachelor degrees (vocational and professional degrees)
(Professional) Master’s degrees in selected fields
The whole HE system provides study places for 65-70% of an age group
Annual intake of students approximately
Annual number of senior high school graduates

7. Key Features of the Finnish Higher Education System
"Open and equal access" for all
An extensive network of HE institutions covering the whole country
Regional equality
Tuition free system
HEIs can, however, arrange made-to-order degree education to citizens of non-EU/EEA countries
In addition, there will be a fixed-term trial of charging tuition fees to citizens of non-EU/EEA countries in master's programmes taught in foreign languages in universities and polytechnics
Provisions concerning university degree programmes will be enacted by a Ministry of Education Decree.
Tuition fees are conditional on a scholarship scheme.

8. HEIs and Sectoral Research Institutes Universities (blue) Polytechnics (green) Sectoral research institutes (red)

9. Cohorts entering (upper) secondary education and the first cycle of tertiary education in

10. Themes of the Presentation
Higher Education System in Finland
Structural Development of Higher Education
University Reform
Steering and Funding of Higher Education Institutions
Science Policy

11. Structural Development of Higher Education
Government Programme stresses the importance to continue structural development of HEIs
To enhance the HE network in order to create more prominent institutions with higher standards
To ensure the quality and effectiveness of HEIs' research and teaching
To allocate resources to top-level research and strategic priority areas
The reform forms part of the European higher education reform
Communication of the European Commission "Delivering on the Modernisation Agenda for Universities: Education, Research, Innovation" of May 2006
Development targets for higher education recommended in the thematic OECD review
Internationalisation, clearer institutional missions and positions, and diversification of the funding structure

12. Aims and measures
In terms of full-time students, the target size for a university is 3,000, for a polytechnic 2,500 and for a strategic alliance 8,000.
The target intake in a degree programme is 40 at the minimum.
Important special fields will adopt a system of admission in alternate years
The department structure will be reformed with the aim of departments/units of at least five professors.
In addition, universities and research institutes to create joint departments
The number of higher education institutions will fall.
The new higher education institutions to be larger and stronger.
Sufficient size of higher education institutions to boost cross-disciplinary education and research, generate new innovations and improve student services.
Close cooperation and partnerships will bring added value to education and research and open new opportunities for students.

13. Aims and measures
Measures are taken to make sure that the higher education system covers the whole country.
With a view to better quality of education and research, activities will be assembled into the main campuses.
High quality of operations will strengthen the impact of higher education institutions on society and on regions.
Only strong HEI units are attractive as cooperation partners to other higher education institutions and players in the innovation system.
Steps to this end
The HEIs to determinate their strategies, profiles and priority areas in their renewed strategies by 2010
Clearer profiles and clearer institutional missions
between higher education institutions
between universities and polytechnics
within universities and polytechnics

14. Vision 2020 Maximum of 18 polytechnics Maximum of 15 universities
Intake in youth education of 22,500 students (in 2009 ~26 500)
Flexible and profiled higher education units and structures
Strong and dynamic interaction with the region and its employers
Well-established, high-quality R&D in priority areas
Maximum of 15 universities
Intake of students (in 2009 ~19 500)
Strong units and profiles; clear priorities in research
Internationalisation and world-class research
Four to five strategic university-polytechnic alliances
Secured access to education and diverse education provision in the area
Joint R&D and stronger (regional) impact

15. Themes of the Presentation
Higher Education system in Finland
Structural Development of Higher Education
University Reform
Steering and Funding of Higher Education Institutions
Science Policy

16. The New Universities Act (558/2009)
The Universities Act includes
provisions on the mission,
administration,
operational funding and steering of universities,
and matters relating to research and education,
students and
personnel.
The reform took effect on 1 August 2009.
The public universities started to set up the new organs of the legal person.
The operations of universities as state accounting offices stopped on 31 December 2009.
The personnel and students transferred to the new universities on 1 January 2010.

17. Means of the university reform in a nutshell
Status as legal persons
universities became legal persons separate from the State, either as corporations under public law or foundations under the Foundations Act.
Corporation under public law (public university)
A legal person under the Universities Act whose organs and their functions are laid down in legislation.
Foundation under private law (foundation university)
A legal person under the Foundations Act which is assigned the university mission in the Universities Act.
The government will continue to be responsible for funding the public duties of the universities even though the universities are no longer within the State budget economy.
The Ministry of Education will ensure by means of steering that university activities conform to the higher education policy aims set by Parliament and the Government.

18. Aims of the university reform in a nutshell
Universities used to be organised as State accounting offices
To give the universities a stronger financial and administrative status, they were made independent legal persons and supplied with sufficient capital.
As legal persons, the universities will be better able to operate with the surrounding society.
Having their own capital, the universities will have more scope for operating based on their own decisions.
Efforts will be made to gain the commitment of other actors in society to support the universities' mission.
Measures will be taken to ensure continued international competitiveness of the university system.

19. The Universities Act will change...
Autonomy will strengthen: universities will have an independent legal status
Universities will take the place of the State as employers: civil-service employment relationships will become contractual employment relationships
Community relations will strengthen:
At least 40% of the members of the board of a public university (incl. the chairman) must be external to the university community
The "external" members are elected by the university collegiate body, which may also decide to have an external majority on the board, if it so wishes.
The board of a foundation university has 7 members, three of whom are nominated by the founding members of the university foundation
The board is appointed by the multi-member administrative body of the university.
Greater latitude with finances: donations, income from capital and business activities
New universities: Aalto university (HUT, HSE, UIAH), University of Eastern Finland (universities of Kuopio & Joensuu) and the new Turku University (University of Turku, Turku School of Economics)
Performance agreement procedure between MoE and universities will be lighter
Charging of tuition fees on a trial basis for separate Master’s programmes from students from outside the EU/EEA

20. The Universities Act won't change...
The freedom of research, art and education
Self-government and academic decision-making
Research and higher education remain as the main tasks of the universities
The State will guarantee core funding, taking into account the development of costs
Education leading to a degree will continue to be free of charge
Further information
> Education > Education Policy > University reform

21. Themes of the Presentation
Higher Education System in Finland
Structural Development of Higher Education
University Reform
Steering and Funding of Higher Education Institutions
Science Policy

22. Steering and funding of HEIs
State funding for HEIs
Universities € 1,7 bn
Polytechnics € 0,9 bn
+ Public research funding (Academy of Finland & Tekes) € 0,3 bn
External funding for universities
(2009, expenses)

23. Allocation framework Legal basis of the university funding
Universites Act (558/2009) 49 § sets the framework
MoE Decree (771/2009) elaborates details
Legal basis of the polytechnics funding
Part of the Government subsidy system - linked to municipality funding
Decree on the Financing of the Provision of Education and Culture (806/ amendments)
Public research funding to be allocated through competition

24. Performance Agreements Between MoE and HEIs 2010-2012
Structure of the agreement:
1. Aims Common to Higher Education System
Verbal goals incl. statutory university/polytechnic missions, internationalization, student & HR issues as well as cost-efficiency and effectivness of operations
Societal impact a priority in all universities' operational targets
2. Mission, Profile and Focus Areas of the HEI
To reflect university's overall strategic plan as well as national HE and science policy goals
To set appropriate strategic targets = to condense a message of the strategy into the essential
To set university / field specific quantitative goals (7)
Indicators (13)
Foremost Development Targets
1-5 projects per university linked to the implementation of the HEI's strategy
Financing
The government funding in total
5. Monitoring and Evaluation

25. Quantitative targets for universities 2010-2012
Actual number
2007
2008
Target
University
Offer 2/09
Bachelor degrees
5 879
13 876
10 170
13 904
13 815
Master degrees
13 884
21 825
14 518
15 244
14 893
PhDs
1 526
1 594
1 755
1 624
Number of pupils at the schools for practice of teachers
7 848
7 833
7 900
8 026
7 920
ECTS completed under teacher training guidance at the schools for practice
41 352
38 273
42 318 )
42 020
Foreign degree students
5 897
7 921
8 245
8 950
Exchange students (incoming & outgoing, > 3 months)
9 254
9 799
11 325
11 615
11 200

26. Quantitative targets for polytechnics 2010-2012
Actual numbers
2007
2008
Polytech.
Offer
Target set (MoE)
Polytechnic degrees
20 276
20 951
22 588
21 650
Vocational teacher education
1 397
1 519
1 544
1 530
Polytechnic Masters
362
681
1 798
1 808
Foreign degree students
5 299
6 294
7 412
8 500
Exchange students (incoming & outgoing, > 3 months)
7 182
7 473
8 705
8 800

27. Performance indicators 1(2)
Education
Students (FTE) / teaching and research personnel
Masters' degrees/ teaching and research personnel
Doctoral degrees/ professors
Percentage of graduation after seven years studies
Percentage of students who have passed more than 45 study credits
Percentage of graduates compared to drop-out

28. Performance indicators 2(2)
Research
International publications / teaching and research personnel
Scientific publications (not including int. publ.)/ teaching and research personnel
Percentage of national competive funding from the university total funding
Percentage of international research funding from the university total funding
Internationality
Staff international mobility / teaching and research personnel
Societal interaction/impact
Percentage of complementory funding from the university total funding
Percentage of employed from graduates

29. Core funding for universities from 2010 Government funding EUR 1
Core funding for universities from Government funding EUR 1.7 billion
Other education and science policy considerations
25%
Formula-based core funding based on the quality, extent and impact 75%
Research and researcher education 45%
Education 55%
Quality and effectiveness
15%
Quality and effectiveness
25%
Extent of activities
85%
Extent of activities
75%
development 25%
Strategic
Education and discipline structure 75%

30. Core funding for universities – Education
Quantity of operations
85%
Quality and efficacy
15%
Quality of education and efficiency of study processes (80%)
The Centres of Excellence in education ( euro annually / centre)
Percentage(%) of degree students who complete at least of 45 ECTS in a year
% of degree students graduating (Master's) within 7 years of enrolment
Internationalisation (20%)
Student mobility from and to Finland (>3 months in duration)
Nr of credits completed in foreign language instruction&earned abroad
- Nr of international degree students
Target number of Bachelor and Master's degrees set in the MoE-University agreement
35%
Number of Bachelor and Master's degrees awarded by tthe university
35%
Calculated number of students
30%

31. Core funding for universities - Researcher training and research
Research and researcher education
Quality and impact
25%
Extent of activities
75%
Nationally competed research funding (60%)
Academy of Finland funding
AoF funding for Research Centres of Excellence
Tekes funding
Scientific publications (20%)
Number of refereed international publication
Number of other scientific publications
Internationalization (20%)
Internationally competed research funding
Extent of teacher and researcher mobility (incoming+outgoing, min. 2 wks)
Target number of PhD degrees set in the MoE-university agreement
25%
Teaching and research person-years
50%
Number of PhD degrees
25%

32. Other education and science policy considerations
Core funding for universities – Other education and science policy considerations
Other education and science policy considerations
Education and discipline structure 75%
- Disciplinary structure
- Special national duties
Teacher training schools
Graduate schools
National Library of Finland
Strategic
development 25%
Strategy of the university
national education and science policy aims
concrete development goals, measures for attaining them, and means of monitoring implementation of the strategy
key development targets are internationalisation and development of researcher career path

33. Funding formula of polytechnics State funding comprises approximately 60% of polytechnic funding. Additional 40% is allocated by municipalities to the polytechnic's operations.
Discretionary government grant
22 M€ in 2009
Government core funding
(A unit price per student* x Number of students)
849 M€ in 2009
70 % (594 M€)
Calculated number of students by polytechnic’s different fields of education
Based on the number of study places and number of students set in the MoE-polytechnic agreement
30 % (255 M€)
Number of degrees awarded by the polytechnic
Average of past two years
Project funding
19 M€
Performance based
funding 3 M€
Discretionary increase in unit price
*) unit prices are calculated every four years on the basis of actual costs

34. Calculated number of students
Polytechnics:
Unit prices by field of education
Calculated number of students
Average price of field of education
Average price of field of study
Field of education
youth
adults
total
in 2009
in 2008
1 Humanities and education
1 039,5
204,7
1 244,2
10 670,56
10 264,27
2 Culture
8 412,0
1 381,2
9 793,2
10 870,42
10 456,63
3 Social sciences, business and administration
17 017,0
4 389,8
21 406,8
6 066,07
5 832,62
4 Natural sciences
4 900,0
978,1
5 878,1
6 150,45
5 913,83
5 Technology, communication and transport
31 644,0
4 859,0
36 503,0
6 911,88
6 646,68
6 Natural resources and the environment
3 104,0
687,9
3 791,9
8 407,78
8 086,43
7 Social services, health and sport
20 555,5
5 815,4
26 370,9
7 714,53
7 419,20
8 Tourism, catering and domestic services
5 435,5
1 224,0
6 659,5
6 876,75
6 612,87

35. Monitoring
From 2010 universities close the books according to the accounting legislation
financial statement is a public document
The HEIs must provide the information requested by the Ministry for the purpose of evaluation, development, statistics and other information needed for monitoring and steering insofar as this information is not otherwise available.
The HEIs have to present correct information on their performance and finances in a way that enables their progress be evaluated against the set goals.
Development is annually monitored through indicators which gauge effectiveness and quality
The universities must manage their finances efficiently and use their resources to good effect
The Ministry of Education gives feedback to the HEIs on their activities and development needs during the agreement period. As a rule, more comprehensive feedback is given during the intervening years between negotiations.
The feedback procedure is used to steer and monitor the implementation of higher education policy objectives during the agreement period.

36. Evaluation
The HEIs are responsible for the quality of their education, research and other activities, and for their continuous development and utilisation.
The quality of performance is indirectly taken into account in the MoE indicator targets and in the monitoring of their attainment.
Regular evaluations and external audits of quality assurance systems are undertaken to enhance the quality and impact of the educational, research and artistic activities of the universities. The findings of the evaluations are published.
The evaluations are organised by the Finnish Higher Education Evaluation Council (FINHEEC), and the Academy of Finland.
The findings of the evaluations are published.
The HEIs, the National Union of University Students in Finland (SYL) and the Ministry of Education are looking into possibilities for a university student feedback system

37. External funding: Academy of Finland
Public financing and expert organisation for scientific research
Competitive funding with external evaluation
Promotes
High-quality scientific research
Diversity and renewal of research
International co-operation
Research Councils within Academy of Finland
Biosciences and Environment
Culture and Society
Natural Sciences and Engineering
Health
Budget 309 million euro (2009)

38. External funding: Tekes – Funding Agency for Technology and Innovation
Public financing and expert organisation for technological research
Promotes
the competitiveness of Finnish industry and the service sector
Aims
To diversify production structures,
increase production and exports, and
create a foundation for employment and social wellbeing.
Finances
R&D in companies, but also in research institutes and universities
Budget 650 million euro (2009)

39. Distribution of research funding in universities
Total 872 M€ (2005)
Source: Statistics Finland

40. Breakdown of investment in R&D in 2006 by sector (% of GDP)
Enterprises Universities Public Sector Total
OECD
U.S.A EU
Japan
Canada
Finland
Source: OECD