5.3 – Government Funding Strategies

Bad News, Worse News and Good News

It has already been pointed out that the bad news for governments is that e-learning is unlikely to save money in higher education, at least in the short term. The cost of technology obsolescence and advancement, and above all the cost of faculty learning how to use the technology and/or the costs of the technical support they will require, will continue to mean that more rather than less money will need to be spent over the next ten years or so.

Secondly, high quality learning requires interaction between students, and between students and teachers. While teaching can be re-organized to maximize investment in e-learning, and online discussions can be organized to keep faculty time under control, higher education is a people-intensive process, so if the quality of learning is to be maintained or improved, then there is a limit to the cost savings to be made from investing in e-learning.

The recent emergence of Massively Open Online Courses (MOOCs) may challenge this notion but the jury is still out on what impact MOOCs will have on costs and quality. MOOC proponents argue that by using peer assessment, self-testing and lower cost tutorial assistants to provide learner support the MOOC model can help improve access and lower costs. It is still too early to accurately assess these claims.

The worse news is that governments will probably have to invest more in technology, not to save money, but to ensure that universities and colleges are developing the skills and knowledge needed in a knowledge-based society.

The good news is that e-learning does provide opportunities for greater cost-effectiveness, in terms of reaching out to more learners, especially those already in the workforce, and for higher quality learning, such as problem-solving, information management, and decision-making skills. But this will only be achieved if e-learning is appropriately funded and, more importantly, appropriately planned and managed.

So if institutions want to use e-learning effectively, increased funding will be necessary. We are probably not talking about huge increases  (less than 5%), and there are a number of ways of finding this extra money. However, most institutions have very little room for maneuver in terms of reallocation of existing funding which limits their options. While one-time funding is useful for certain elements of capital expenditure, the major costs are in salaries for support staff, which are recurrent operating costs.

Some of the possible funding strategies include:

  • reallocating existing resources;
  • creating new institutions;
  • increasing tuition fees;
  • providing short term grants for e-learning initiatives;
  • increasing government funding for educational institutions;
  • using e-learning to absorb new enrollments;
  • encouraging the development of cost-recoverable e-learning programs;
  • allowing public institutions to create for-profit e-learning companies.

One Funding Strategy: Targeted Funding

Funding is probably one of the most effective tools that governments can use to implement its goals for higher education. Since the late 1980s many governments have turned to funding strategies to influence the behaviour of even large research universities. One typical strategy is for government to hold back funds for innovation or technology investment, as a means of encouraging change. Several provincial governments have put money into different ‘envelopes’, to encourage individual professors to collaborate across institutions to develop technology enhanced teaching materials.

In 1992 the British Columbia government withheld 2.5% of the operating grant of post secondary institutions and allowed them to reapply for it if they could demonstrate they would use it to support innovation in teaching and learning. Indeed, the development of WebCT was supported out of this innovation fund. Similar “funding envelope” approaches have been used in Alberta and Saskatchewan.

Sometimes funding strategies are combined with more radical institutional strategies. As an example, BC Campus administers and online program development fund that post secondary institutions bid on by submitting proposals on an annual basis. More recently, it created a program to support the development of open textbooks. The new Ontario Online Institute is expected to adopt a similar approach. This approach to funding is meant to encourage institutions to use e-learning.

However, how effective are such strategies in bringing about fundamental change in institutions? Indeed, is it appropriate for governments to interfere in this way? For instance, could such policies lead to the development of collectives of Lone Rangers, whose influence on an institution disappears as soon as the funding stops? If institutions do not respond to these funding opportunities strategically, the goal of using e-learning to address key priorities may not be achieved. My experience at two BC post secondary institutions is that often the proposals that are submitted to these funds are not aligned with any strategic institutional goals but, rather. are designed to support individual pet projects of the faculty members concerned. So targeted funding is only one element in achieving greater and more effective use of e-learning. It must be accompanied by planning at the institutional level that clearly identifies e-learning as a strategy. Bates (2001) identifies a number of other issues that need to be addressed If a government is interested in using e-learning as an opportunity for change:

  • Do the institutions have the necessary resources (financial, technical and management) to support e-learning?
  • What can government do to facilitate the process of change towards greater use of e-learning?
  • Is e-learning the most appropriate means to bring about change; would the same investment in resources and effort in other areas bring better results? (Bates, p. 75)

This last point is an extremely important one, as e-learning is not a panacea for all problems that face higher education and training institutions. If we are uncritical in our application of e-learning, we are unlikely to be very successful in our efforts. More seriously, we are likely to undermine the credibility of e-learning as a viable strategy or approach to meet current challenges.

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Bates, A.W. (2001). National strategies for e-learning in post-secondary education and training. Chapter 6. Paris: UNESCO/International Institute for Educational Planning.