Plan for Amalgamation of Public and Private Universities: Model Construction through Self-driven Innovation from Cooperation to Combination
Purdue University is a U.S. public school, the place of origin where Wikipedia was launched and where the first electronic television was invented, and is well-known for engineering studies. In 2017 it amalgamated with Kaplan, Inc., a private institution, and this created a larger student pool than just from the State of Indiana where Purdue is located. It is Kaplan’s strength – scholastic management and marketing – which leads to a gradual rise of revenue and a more robust administration at Perdue.
Such an idea of public-private marriage has spread from Perdue University to Asia. As to the Republic of China (R.O.C. Taiwan), the number of colleges and universities is as high as 152, and the low birth rate has had an impact on the intake of students. The Ministry of Education (MOE) estimates that there will be only 162,000 freshmen in 2028, fewer by 77,000 than the present number. With this concern in higher education, all colleges and universities are in urgent need of workable ways to improve operation performance when facing competition from around the world.
There has never been any case in which a domestic public college or university and a private one combine. If it could be put into practice, then it should be given multifaceted support from laws and mutual agreement. For this reason, last year, the MOE commissioned Chan, Sheng-Ju, a professor of the Graduate Institute of Education at National Chung Cheng University and director of Quality Assurance and Projects Office at the Higher Education Evaluation and Accreditation Council of Taiwan, to conduct research on the issues of the amalgamation between public and private higher education institutions. He explored foreign cases thoroughly and recommended directions that are feasible for practice in our nation.
Both the two directions and the two forms found in amalgamation cases
Chan, Sheng-Ju published “A Report on the Result Analysis of Amalgamations of Public and Private Universities” in late September 2020, pointing out that universities amalgamate in two directions: vertically and horizontally. The former proceeds as in the case of how National Hsinchu University of Education (NHCUE) was amalgamated with National Tsing Hua University (NTHU) in 2016; the latter proceeds as how National Chiao Tung University (NCTU) in Hsinchu City and National Yang-Ming University (NYMU) in Taipei City amalgamated into National Yang Ming Chiao Tung University this year.
Universities amalgamate in two forms, too. The first is homogenous amalgamation. For example, National Kaohsiung First University of Science and Technology, National Kaohsiung Marine University, and National Kaohsiung University of Applied Sciences, all of which excel in the field of science and engineering, amalgamated into Kaohsiung University of Science and Technology in 2018. The second is heterogeneous amalgamation, into which the aforementioned NTHU, NHCUE, NYMU, and NCTU are categorized.
There have been various permutations and combinations of amalgamation between public and private schools among nations. Chan, Sheng-Ju mentioned that the case of “transformation from public-public combination into one private school” pushed forward by the government exists in Finland, where Helsinki School of Economics, Helsinki University of Technology, and University of the Arts Helsinki, in the quest for a higher international ranking, amalgamated into Aalto University, which signifies a well-known Finnish architect’s achievements. The strategy adopted by Finland definitely works well. Aalto’s ranking among universities in the world rose from 222nd as of 2010 to 134th as of 2020.
The case of a “public to private” amalgamation was found in the U.S., where the New York Hospital, under the impact of government budget reduction in health care, was amalgamated in 1998 with the adjacent NewYork-Presbyterian Hospital (NYPH). Since NYPH is the teaching hospital for two local medical colleges, this amalgamation amounts to synergy between a hospital and a school.
In Japan, to tackle the closure and withdrawal crisis of private schools under the declining birth rate, the government lately launched an “alienation” mechanism that encourages a poorly managed private university to be divided into several colleges, the ownership of which will be transferred to other universities, and allows national universities as corporations to operate many universities simultaneously.
In this April, Hamana Gukuen, which operates Kansai University of International Studies, absorbed Kobe Yamate University, an operationally ailing institution, and in Japan this is the first amalgamation case between private schools through forming an alliance.
In all, according to Chan, Sheng-Ju’s observations, what is most often seen in the way that amalgamation proceeds is vertical amalgamation based on complementarity and heterogeneity between two schools. For example, the Institute of Education at University of London was amalgamated with University College London in 2014. In such a form of amalgamation, there are certain incentives for both parties to promote course diversity for students and to cooperate instead of competing for student recruitment; with regard to the power to govern, because the scale of one school is obviously larger than that of the other, the scene where two powers struggle with each other is less likely to occur.
“Private to public amalgamation” is difficult and not easy to implement
Chun-Chang Chu, Director, Department of Higher Education, Ministry of Education, pointed out that, many colleges and universities in our nation have also sought to make possible a vertically heterogeneous amalgamation with the other one, and the “public-public amalgamation” has been carried out one after another by public schools. But the approach to the “private to public amalgamation” poses a greater challenge. When strong enough, the board of a private school has no interest in any public-private amalgamation lest it should lose its dominance; when weak and near withdrawal from higher education, the board of a private school, despite the willingness to seek an amalgamation or even school property donated or transferred to others, finds it hard to attract any public schools to take control.
Chun-Chang Chu indicated that the “private to public amalgamation” is less likely to allow any colleges or universities to turn from private into public once and for all under current circumstances but, more feasibly instead, from public to overall corporatized, that is, separating public school personnel matters from the government system. Many years ago, the MOE mulled over corporatization of public schools in accordance with the precedents in Europe and the U.S. but has not put it into effect on account of a potentially huge impact on the rights and interests of teachers with a public office paycheck. Such concern implies a tremendous obstacle to colleges and universities that are seeking a public-private amalgamation.
Another likely approach is the publicization of private schools, through which the delegates from a public school are assigned to the private school Board for amalgamation implementation. This is workable from the legal perspective, according to Chan, Sheng-Ju’s analysis, but the lack of what motivates a private school to yield its right of dominance and determination is predictable.
Laws are absolutely not the only hindrance to school amalgamation. “How alumni feel also poses a challenge to a school amalgamation,” said Chun-Chang Chu, who took the just amalgamated National Yang Ming Chiao Tung University as an example, and even a discussion on the school’s name caused much controversy and difficulty in reaching a consensus because of alumni’s feelings concerning where they had graduated from. Tests after the amalgamation, such as integration of the departments and institutes whose fields are overlapping and persuasion from external parties regarding certain benefits to be gained from the amalgamation are what the university leaders will have to go through.
Instead of referring to foreign cases, it is better to innovate by oneself
In view of the emerging domestic call for an amalgamation between public and private schools, the MOE considers that the experiences of other countries cannot be duplicated in the R.O.C. (Taiwan) on account of environment and background differences, thus encouraging colleges and universities to roll up their sleeves, and start sandbox innovation from scratch in a joint effort with the government, and develop any amalgamation model between public and private institutions that suits our nation.
The MOE welcomes colleges and universities to propose pilot projects and will evaluate their content, assisting in the provision of software and hardware such as that of finance and equipment. In addition, project performance will be recorded, the actual demand for and experience of cooperation between public and private schools will be progressively collected, and hopefully laws amending or lawmaking will be further taken into account.
In fact, the MOE has continually made adjustments to the existing law. For example, the amendment to Article 7 of the University Act was made in 2005 to encourage universities to engage in amalgamation and welcome them to approach the top-down formulation of an amalgamation plan to be submitted to the MOE for approval; further, the amendment to Paragraph 2 of the same Article was made in 2011 to allow the MOE to formulate a top-down plan for university amalgamation to be submitted to the Executive Yuan for approval.
The Department of Higher Education, MOE, recommends all schools to use the following two models for a public-private amalgamation on a trial basis. The first is the advancement model for teaching and research, where a mechanism of cooperation between schools is built, for example, to promote double majors and dual degrees across universities, go beyond the established organizational boundaries between schools, and facilitate inter-school mobility among faculty, students, and staff members.
The second is the innovation model for governance, where a mechanism of joint governance and decision-making is built to help the two parties involved to reach consistency in the qualities and criteria of school operation and to deepen and strengthen substantive cooperation.
The Department of Higher Education explains that public universities should play the leading role, which is meant to resolve external concerns about whether public property will be transferred to private ownership, or is appropriate for the promotion of public-private amalgamations in response to the trend of higher education in our nation and expectations from the society. On the contrary, private universities will lose part or all of the leading role in school operation.
The amalgamation of universities should take competitiveness improvement, academic excellence, and development transformation as the axis. The MOE will base the review of how appropriate an amalgamation application is on such indicators under an amalgamation as: performance, competitiveness, resource integration effect, and contribution to society.
The Department of Higher Education expects respective schools of applying “combination replaced with cooperation first”. As Chun-Chang Chu pointed out, it is definitely not easy to accomplish an amalgamation, but similarities with and complements to each other can be revealed through cooperation so that a consensus can be garnered for school amalgamation in pursuit of excellence as the ultimate goal.