Study On The Matching Between Higher Education Expenditure Responsibilities And Financial Safeguard In China

Chinese universities are divided into central subordinate ones and local ones. Inrecent years, the extent of fiscal resource support that central and local governments offerto central subordinate universities and local universities has differed greatly. Fundingsafeguard capacity for higher education in31provinces is very different. How toimprove higher education investment mechanism, enhance the support ability of thepublic finances for higher education expenditure, promote the rational matching betweenhigher education expenditure responsibilities and financial safeguard, solve the problemof under-spending for higher education caused by financial shortage in some provinces,ease higher education finance longitudinal imbalance and horizontal imbalance, andultimately boost the coordinated development of higher education in different regions？These are problems about higher education finance we have now.What level of government finances higher education is a realistic and complex issueunder the framework of multi-levels governments and decentralized fiscal system. Firstof all, this study explores the assignment of higher education expenditure responsibilitiesfrom the theoretical level based on the theory of fiscal federalism and the benefithierarchy of public goods, then analyzes the practical arrangements for higher educationexpenditure responsibilities in31countries. The publicity and quasi-public productattributes of higher education, the publicity of finance determine that finance shouldensure funding higher education. Working out the funding standards per student,establishing higher education funds safeguard system, improving the financial inputmechanism and strengthening the education funds management are the importantmeasures that financial resources safeguard higher education expenditure. The rationalmatching between higher education expenditure responsibilities and financial safeguardcan provide a more solid financial support for the development of higher education,enable governments to effectively fulfill their responsibilities of funding higher education,help to promote the fiscal equity of higher education and prefect the higher educationfiscal budget management system. The matching between higher education expenditure responsibilities and financialsafeguard includes central-local longitudinal matching and inter-provincial horizontalmatching under the framework of multi-level governments and hierarchical fiscal system.Thus two sets of measure systems are designed. The longitudinal matching measure isbased on quantitative comparative judgments and qualitative comparative judgments,using three measure methods. The first method is to examine the closeness degree ofhigher education expenditures centralization index and government revenuecentralization index. The second method is to compare the proportion of three levels ofgovernment higher education expenditure in government fiscal payment. The thirdmethod is to compare the proportion of three levels of government appropriation insources of college and university funds structure. The horizontal matching measure isbased on inter-provincial panel data, building the prediction model of on-budgetappropriation of local general institutions of higher education, comparing the size of thepredictive value and the actual value of on-budget appropriation of local generalinstitutions of higher education at existing financial level in order to determine thematching between higher education expenditure responsibilities and financial safeguardin each province.The measure results of the matching of higher education expenditure responsibilitiesand financial safeguard between central and local governments are as follows. The highereducation expenditures centralization index is greater than government revenuecentralization index. The proportion of higher education expenses paid by the centralgovernment decreases with the increase of its fiscal resources. The proportion of highereducation expenses paid by the local government increases with the increase of its fiscalresources. Higher education expenses paid by the central and local governments don’tmatch well to their financial safeguard as a whole. The measure results of the matchingof inter-provincial higher education expenditure responsibilities and financial safeguardare as follows. Over the period of2005to2009, higher education expenditureresponsibilities matched financial safeguard in14provinces, such as Beijing, Hainan,Hunan, Shandong. But higher education expenditure responsibilities didn’t matchfinancial safeguard in17provinces, such as Yunnan, Hebei, Sichuan, Qinghai. The following three questions, intergovernmental higher education expenditureresponsibility arrangements and the proportion of the burden, matching degree of highereducation expenditure responsibilities and financial safeguard, the measures that promotehigher education expenditure responsibilities to match financial safeguard are focused onwhen examining and learning from international experience. The selected case countriesare the United States, Canada, Germany, Australia and Switzerland. The federal and state(provincial) levels both fund higher education in these five countries, the division ofintergovernmental higher education expenditure responsibilities is clear-cut and there arelaws to abide by, the changing trend of intergovernmental higher education spendingburden ratio is very close to revenue ratio. The system of federal Higher Educationspecial transfer payments or federal grants system is perfect. The practical experienceoverseas provides useful inspiration and reference for China.Studying from the problem of the mismatching between higher educationexpenditure responsibilities and financial safeguard in China, combined with the theoryof public finance and foreign practical experience, the paper reveals the foundation andthe key to match higher education expenditure responsibilities with financial safeguardare the expenditure responsibilities assignment and the financial security capabilities.Government financial resource and higher education expenditure responsibilities reversetransferring is the direct reason to cause the mismatching. Higher education financialvertical and horizontal imbalance results from the mismatching. The four keybreakthrough points that solve the mismatching are to promote the explicitation of highereducation expenditure responsibilities, the legalization of higher education expenditureresponsibilities, the scientification of financial resources distribution, the establishmentof the transfer payment mechanisms to support the development of local highereducation.In order to improve the support ability of the public finances for higher educationexpenditure, solve the mismatching between higher education expenditureresponsibilities and financial safeguard, this study explores the realization route of thematching between higher education expenditure responsibilities and financial safeguardfrom the three aspects of perfecting responsibility arrangements, enhancing financial safeguard and strengthening institutional constraints. And some concrete proposals areput forward.In summary, the study focuses on the matching of higher education expenditureresponsibilities and financial safeguard, based on the theory of public finance. The studypropose two new concepts of higher education expenditures centralization index andgovernment revenue centralization index. The study also solves the technical problems ofmeasuring the matching between higher education expenditure responsibilities andfinancial safeguard and facilitates the research of matching expenditure responsibilitieswith financial safeguard from the theoretical level to the practical level.