Universities Lack Will to Reform

Takamitsu SAWA (Professor, Kyoto University)

Half a year has passed since Japan's national universities gained corporate status. The aim of the incorporation, initially at least, was to make university management efficient. What has changed, or has not changed, in substance? How much progress toward efficiency has been made, or is likely to be made? Let me address these questions on the basis of my experience.

National university teachers are not public servants anymore, yet most restrictions derived from the Public Service Law and the Public Education Personnel Special Law remain. However, since these restrictions can be altered or abolished at the discretion of each university, the degree of liberalization must vary.

It is possible, for example, to adjust the numbers of teaching posts among various divisions of a university -- such as departments, graduate schools and research institutes -- because the "quota" requirement has been abolished. Yet, at most universities, there are no discernible signs that executive boards have tried to make adjustments using their prerogatives.

Marginal productivity in research and education -- a measure of the increased level of achievement resulting from the addition of an extra researcher or teacher -- does vary. So the cross-division adjustment of teaching posts is not only necessary but also unavoidable if efficiency in education and research is to be increased within the budgetary limits.

Some fields of science and technology have high marginal productivity; others do not. Therefore, it is urgently necessary to create a mechanism for reallocating "resources" -- teaching posts -- from high-productivity to low-productivity fields.

It is practically impossible for national universities to make money, or generate net profits, on their own. Their main source of income is tuition. Their hospitals are in chronic deficit. Although the number of patents acquired by teachers has been increasing, those "useful" enough to bring new revenues to universities are few and far between. In terms of costs and benefits, most patents do not pay, as the expenditures required for applications exceed the revenue. The idea of collecting part of teachers' writing and lecture fees is difficult to institutionalize.

About 57 percent of national university revenues come in the form of the education ministry's "operating-expense grants." This heavy dependence on government grants will continue unless tuition is raised to about the same level as that of private universities. Private universities also depend on government aid in the form of subsidies.

It is also extremely difficult for universities to raise efficiency and reduce costs through staff reduction. Even private companies rarely resort to layoffs unless they go into the red. They often trim the fat by hiring temporary and contract workers, encouraging regular workers to retire early (with a premium on separation pay), or transferring regular workers to subsidiaries. Universities do not have subsidiaries, and cannot afford to pay extra retirement allowances.

Another thing stands in the way of staff reduction: the existence of administrative staff that is essential to education and research. Aside from nurses and technicians, administrative employees are engaged mostly in backup services such as general affairs and accounting.

During the period of the old national universities, many employees believed that it was their duty to "manage" teachers because, without their help, teachers with little knowledge of public administration or worldly affairs might get into trouble. The primary duty of administrative staff should be to support education and research.

American universities, for example, have employees who help teachers prepare application forms to obtain research grants from organizations such as the National Science Foundation. These people, knowing full well what should be or should not be stated therein, check the papers and advise professors if necessary. With such "competitive funds" likely to become increasingly important as a source of university revenue, these "professionals" are a valuable asset to universities.

National universities in Japan should start training employees to do similar tasks. It is vitally important to motivate them as supporters of education and research, and to raise their pay accordingly.

University teachers can be likened to frontline people in business, such as those in production, sales, purchasing and advertising. To improve performance, universities must improve the quality of teachers, reassign them to high-productivity fields and increase their number in these fields. Since increases in operating-expense grants (for personnel and supplies) are not likely, efficiency in administrative work must be improved and the number of employees reduced so that the number of teachers can be increased.

Private companies have tried to improve efficiency by reassigning workers in backup divisions to frontline positions, such as by shifting general-affairs personnel to sales. For universities, though, this is impossible because it would mean reassigning people in administrative (backup) services to teaching (frontline) posts.

So the only way to expand the teaching staff would be to maximize net staff reduction (excluding nurses and technicians) -- the number of retirees minus the number of new hires -- so that personnel expenses for teachers can be increased through gradual reduction of those for administrative staff.

In other words, national universities can be made efficient only by increasing the number of frontline personnel -- teachers -- through complete rationalization of backup divisions.

Every national university has many administrative employees largely because it retains a "dual structure" of "headquarters" for overseeing administrative functions and "chapters" that represent various divisions. By contrast, the economics department of a U.S. state university, where I served as a professor for three years, had an administrative staff of only four (a secretary to the dean, two female assistants to the secretary and a woman in charge of administrative affairs) that served a teaching staff of more than 50. Administrative services there are fully centralized.

The Economic Research Institute of Kyoto University, where I teach now, has 10 full-time and three part-time administrative employees against 24 teachers. Final decisions are made by a headquarters section in charge, and chapter employees act as "mediators" between teachers and headquarters.

In summary, it is unlikely that the incorporation of national universities will make them efficient anytime soon. The executive board is a powerful body of 10 or fewer members, but it does not seem willing to exercise its powers.

If I am to make a conclusion, it is that national universities as they stand have little or no stomach for reform and that prospects for reform are equally dim. My guess is that it will be more of the same 10 years from now.

(This article appeared in the November 1, 2004 issue of The Japan Times)