Truly, the Federal and state government-owned universities are collapsing owing to inadequate funding. Thus, 2018/2019 academic year that was supposed to incept in September, is yet to start four months after as lecturers are on strike. Truly, private universities may soon out-pace the highly regarded first-generation public ones in prestige and learning.
There is a third truth; that some of the public and private universities may die within decades – as their owners may prove unable to continue funding them. All government universities are already in dire straits, with hostels shamefully over-congested and the toilet smelling terribly. Some of the private universities’ birth pangs may also prove to be their death throes – as they will continue to experience less than sustainable student population though they depend solely on tuition fees. Their present proprietors may keep sustaining them but their successors may not be that nobly inclined.
Now this raises a real paradox; why should fully accredited private universities experience inadequate applications when the government universities cannot, even when adequately funded, offer admission to a tenth of qualified applicants? Recently, about 1.7 million candidates struggled for the less than 500, 000 slots available in public universities, polytechnics and colleges of education. Most applicants struggle to get into the tuition-free federal universities. Others fight to enter the state government universities whose fees are more moderate than private universities.
Of course, the rich send their wards to foreign universities, with 71,000 in Ghana alone, paying US$1 billion according to the Emir of Kano, Lamido Sanusi, totalling more than the US$751 million subvention for all the federal universities. But this figure contrasts heavily with UNESCO’s figure; 13, 000.
Actually, Nigeria is third on the list of countries with the highest number of students studying overseas. 18, 000 are in the UK, and Mr. Iain Steward, member of the British Parliament, said that UK targets 30,000 by 2020. 7,318 Nigerian students travelled to the US in 2014 according to the US Embassy and 13,000 are in Malaysia, 6,000 in Canada. 3,300 were in Ukraine, 777 in Russia in 2016. There are thousands more in South Africa, UAE, Saudi Arabia, Egypt, Hungary, India, Turkey, Australia, Germany, everywhere.
So, the first answer to funding problems should be a reversal of government policy that public universities should not charge tuition fees. Now, the going annual fee at the University of Benin, is just N71, 000; the median rate at all Federal universities. If this is increased to just N300, 000 a year, the schools could become viable.
How do universities elsewhere raise funds? Here, one respondent to my last Saturday’s article, Mr. Fidelis Ojeah, asked me to write about Howard and Georgetown universities, Washington DC, USA. I don’t know what informed his choice but I must confess that they are apt for the task at hand. Howard, a leading Historically Black College /University (HBCU) started in 1867 shortly after the American Civil War and the abolition of slavery in the US and is named for General Oliver Otis Howard, a white Civil War hero, who was both the founder of the University and, at the time, Commissioner of the (black) Freedmen’s Bureau. Howard later served as President of the University from 1869–74. Much of its early funding came from endowment, private (whites’) benefaction, and tuition. In the 20th and 21st centuries an annual congressional appropriation, administered by the U.S. Department of Education, has been helping “Howard U”. Hampton University, Spelman College, Fisk University, Morehouse College, Tuskegee University and Dillard University join Howard in forming the Black Ivy League Universities.
Georgetown College incepted earlier in 1789 as the first Catholic University in a non-Catholic America, after the American Revolution allowed religious freedom. Understandably, the young Georgetown College was financially strained. The Maryland Society of Jesus began its restoration in 1805, and Jesuit Rev. Fathers poured in as lecturers and administrators. The school relied on private sources of funding and the limited profits from local lands which had been donated to the Jesuits. To raise money for Georgetown and other schools in 1838, Maryland Jesuits conducted an abomination; a mass sale of some 272 slaves to two Deep South plantations in Maringouin, Louisiana from their six in Maryland, ending their slaveholding.
Today, Georgetown is home to US largest student-run businesses, largest student-run financial institution, and oldest continuously running student theatre troupe. In 2014, Georgetown received $172 million in external research grants. In 2010, the school received $5.6 million from the Department of Education to fund fellowships. Georgetown’s Lombardi Comprehensive Cancer Center is one of 41 research-intensive comprehensive cancer centres in US, and developed the breakthrough HPV vaccine for cervical cancer and Conditionally Reprogrammed Cells (CRC) technology.
The School of Foreign Service (SFS) was founded in 1919 by Edmund A. Walsh, to prepare students for leadership in diplomacy and foreign commerce; an innovation. It launched Third Century Campaign to build the school’s endowment, and by December 2003, had raised over $1 billion for financial aid, academic chair endowment, and new capital projects. Georgetown’s endowment stands at $1.6 billion now.
Hey, have you watched the film, The Exorcist? It was filmed at Georgetown! The props exist today and draw in tourists’ dollars
Howard, the predominately Black University, was the major engineer of the US Civil Rights movement. Stokely Carmichael, a student in its Department of Philosophy and the School of Divinity, coined the term “Black Power”. Howard has produced more African-American Ph.D.’s, lawyers and architects than any other institution. Dr. Nnamdi Azikiwe also schooled there. Founded by church organizations and white philanthropists in 1867, Howard had a mission: to educate newly freed black slaves after the Civil War. As a result, though it is a private university, Howard has enjoyed special appropriations from the federal government — about $200 million a year over the last decade. But as a result of congressionally mandated cuts, Howard lost $12 million in 2016.
Also, tuition and other revenues decreased by 8 percent to $22 million) compared to FY2016. Grants and contracts fell by 5 percent ($3 million) in 2017 as its Teaching Hospital, Faculty medical practice and dental clinic revenues declined by 4 percent ($10 million) in 2017 than in FY2016. Yet, Howard is solvent because of its endowment funds; $686 million. The investment returns and $5.3 million in donor contributions helped it last year. Approximately 45% of Howard’s endowment is governed by donor restrictions, while the remaining 55% is available for Board’s spending decision.
Globally, Harvard University has the largest endowment fund; $39 billion, and it is managed by Harvard Management Company. Yale University follows it both in the US and the world, with $29 billion, University of Texas – $26.5 Billion and Princeton University – $25.9 Billion. In Europe, Oxford University leads with £5.5 billion while Cambridge follows with a billion less. The two other European Universities with endowments of over Euros 1b, are ETH Zurich (Switzerland) and Copenhagen (Denmark). Endowment funds support nearly every aspect of university operations: faculty salaries, including professorships, and financial aid for undergrads, graduate fellowships, and student life and activities, libraries, art museums, facilities, and a wide variety of other activities.
Even with endowment support, Harvard must fund nearly two-thirds of its operating expenses ($5.0 billion in fiscal year 2018) from other sources, such as federal and non-federal research grants, student tuition and fees, and gifts from alumni, parents, and friends.
Endowment gifts are intended by their donors to benefit both current and future generations of students and scholars. As a result, Harvard is obligated to preserve the purchasing power of these gifts by spending only a small fraction of their value each year. Now Harvard owns shares in blue-chip companies and tomato farms in Brazil. In fact, Brasil Timber Limited, Empresas Verdes Argentina, and Scolopax—may sound like companies students learn about in a course on “Globalization and Agriculture” at Harvard, but they are timber plantations that Harvard University fully owns. The Harvard Management Corporation invests the funds.
A large majority of endowment funds are earmarked for donor-specified purposes such as professorships and fellowships. Only the remaining 13 percent is unrestricted—$19 million in FY17—and can be used to help fund new ideas and initiatives. $11.6 billion has gone to the university, accounting for about a third of its budget, according to The Boston Globe newspaper.
Apart from buying shares in blue chip companies, Harvard has made some eyebrow-raising investments such as buying farmland in Brazil, South Africa, and New Zealand in 2008. Then came a major investment in Russia and Ukraine, followed by several farm purchases in Australia and the United States. By June 2017, Harvard had injected over US$ 930 million into its various farmland subsidiaries and had acquired control of over 850,000 hectares of farmland around the world, making the University one of the world’s top farmland buyers.
The central idea behind this series is to challenge Nigerian universities to discover new ways of doing things. Instead of a cumbersome generalisation, I have always focused on the Western Delta University, Oghara for my examples. So? How has what has been written above affect that particular University? During its Convocation ceremony of November 10, 2018, His Excellency Governor Arthur Ifeanyi Okowa of Delta State instituted the N500, 000 Ifeanyi Okowa Prize for the Best Graduating Student. The ONLY WAY to make this prize exist in perpetuity is if some money is given to WDU as an endowment fund, and the money is invested, and its profit is used to service the Prize.
Universities must find creative ways of earning money. University of Nigeria, Nsukka, has its LION sachet water, but that may not be as profitable as if some floors in its 10-storey library building were rented out as office spaces. The Obafemi Awolowo University had its farm. But as the farms are no longer profitable, they may be rented out to REAL FARMERS and the university may be consultants. Harvard is a big dealer in landed property. Nigerian universities may lack the money to build offices or residences for rent, but many have enough land for such buildings. They may therefore invite banks to erect the buildings on their lands under an agreed payment ratio.
It is unfortunate that little of applied research takes place in Nigeria, if not, that is the easiest way for a university to earn money because some pharmaceutical companies, for instance, could pay them to conduct researches that could lead to new drugs. Howard does some research for America’s National Aeronautical and Space Administration (NASA). But until the universities begin to get the big endowments that would lead to big investments, they should learn to use their little possessions profitably. Halls could be hired out for weddings, conferences, conventions, etc. They could own petrol stations near their campuses where the petrol attendants could be students who would earn some stipends. People would flock to such places to fill their tanks because they would trust a university not to cheat.
As rich as Howard may look, with $686 million in its nest, it has been witnessing frequent unrests recently as students and lecturers have been rising up against fund mismanagement leading to frequent top personnel changes. Yet, it had made $75 million in total investment returns and $5.3 million in donor contributions last year alone. Many Nigerians have donated buildings but unless universities incubate endowment funds, they will never thrive. James Baldwin, the Black activist reminds us: “There is never a time in the future in which we will work out our salvation. The challenge is in the moment, the time is always now. The rot in our universities should worry us because every society rises or falls with its universities.