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PRIVATE higher education institutions (PHEI) have been hit hard by the Covid-19 pandemic with lockdowns affecting current students as well as the enrolment of new students.
According to the National Association of Private Educational Institutions (Napei), as many as 60 PHEI closed last year alone, student numbers fell by 20-50% and international enrolment declined by 20-30% and might fall further by 50% due to extended lockdowns this year.
As many as 200 out of 600 technical vocational education and training centres had no new enrolments at all because they rely on face-to-face practical training and at least 16 have closed with losses of RM160 million, according to Napei.
The lockdowns have had a significant impact on enrolment, finances and operations for PHEI, making the already chronic financial stress even worse.
Many switched to online learning with high-cost investments, which they might struggle to recover as fees for online courses fall and students return to campus for traditional face-to-face classes.
Separately, scandals related to the revocation of accreditation of multiple programmes at a leading local PHEI leaving hundreds of students stranded without degrees and the sale of one foreign franchise at less than the cost of its establishment have signalled deeper and persistent issues in quality and viability across the sector, which we have been highlighting for many years.
Civil society groups and politicians have made some suggestions, which although well-meaning, show how uninformed many people are about PHEI.
For example, tax breaks for PHEI have been proposed without noting that around 40% of universities are tax-free foundations or owned by state-entities or government-linked companies and do not need tax breaks. The remainder are making losses, which can be carried forward and so they will not pay taxes now or in the next few years.
Cutting fees has also been proposed, not so much to help PHEI but to help students paying full fees for online programmes.
With falling revenues and enrolment, this will make the financial stress worse and cost-cutting will further reduce quality to students and put pressure on the salaries of academics already in precarious jobs.
In fact, the market itself is pushing fees down, with undergraduate fees now as low as RM24,900 and one household name PHEI offering an entire portfolio of master’s programmes for RM8,000.
These lower prices come at lower quality in the red ocean of the private degree market and it is students and staff who are suffering most.
As we look to the future, an optimistic business-as-usual approach post-Covid-19 might say that the recent lockdown as an aberration and campus reopening will restore operations, growth and finances.
Some will also point to management changes and claim that they improved performance, pivoted to online learning and changed pedagogical approaches in a smooth transition to Education 4.0.