Some funding for international students is justified, but $238 million is on the ‘high side’, says MP Leon Perera

The government spends about $238 million on scholarships and tuition grants for foreign students in schools and autonomous universities, said Education Minister Ong Ye Kung in Parliament yesterday (5 August).

He was responding to questions from WP MP Leon Perera who asked for exact figures on this particular spending. Mr Perera had in fact questioned the minister on this same issue in July but at the time, Mr Ong did not fully answer the question, which is why Mr Perera resubmitted his inquiry.

This time, Mr Ong noted again that about $130 million is spent on scholarships for foreign students in schools and autonomous universities – a figure he already specified in July. When pressed by Mr Perera yesterday, Mr Ong added that another $108 million is spent in tuition grants, bringing the total up to about $238 million a year. That’s roughly 1.8% of the Ministry of Education’s annual budget spent on scholarships and tuition grants for foreign students.

Mr Ong noted that his ministry’s annual budget of about $13 billion is “overwhelmingly spent on Singaporean students”, adding that in the last 10 year, government spending on international students in terms of scholarships and tuition grants has fallen by about 50%

We did note in a previous article that the then-Minister of Education Heng Swee Keat said in 2014 that the tuition grants for international students come up to about $210 million per year. So five years ago, the government spent $210 million a year on tuition grants for foreign students but now that figure has dropped by more than 50% to $108 million.

In his response to Mr Perera’s questions, Mr Ong noted that the core objective of the education system is to serve the needs of Singaporeans. He stressed that no Singaporean student is ever displaced from an institute of higher learning (IHL) because of international students.

“Beyond the heavy government subsidies available to all Singaporean students, there is also financial aid in the form of assistance and bursaries to ensure that fees remain affordable for lower and middle income families,” clarified Mr Ong.

Talking about his earlier answer regarding the $130 million in government spending on scholarships for international students, Mr Ong explained that the figure is a nominal one that represents the worth of the scholarship to the students, not the cost to the education system as a whole.

He used an analogy of restaurant vouchers to explain:

“Let’s say a restaurant gives a $100 voucher to a customer. So the voucher is worth $100 to the customer but the incremental cost to the restaurant must less because the cost of rental, utilities, service staff et cetera are more or less fixed already whether the customer turns up or not.”

By that same logic, Mr Ong explained that even if Singapore sends back all its international students who are on scholarships, the country will save much less than $130 million because costs such as staff salaries and overhead fees still have to be forked out to keep a university running.

Mr Ong also noted Singaporeans pay around 25% of the total cost of university fees, but “even after tuition grant, a foreigner will still pay twice the amount” that a Singaporean does.

The benefits of having more international students

Mr Ong moved on to explain that having foreign students presents Singaporean students with the opportunity to build bonds with students from other countries and expand their networks. “This is an increasingly important aspect of education because we are all working in a globalised multicultural world,” he emphasised.

Echoing points made before, Mr Ong said that international students can potentially contribute to Singapore as well. He talked about how many students eventually “sink roots, take up permanent residency or citizenship, or raise their families” in Singapore.

“Even if they decide to leave Singapore after fulfilling their obligations, they can be part of our valuable global network of fans and friends who can speak up for Singapore from time to time and forge collaborations with Singapore.”

Mr Ong then proceeded to mention that every reputable IHL around the world admits international students and provides some form of financial support. The best universities in the world like Yale and Oxford all have a diverse international student body, says Mr Ong, far more than IHLs in Singapore.

He also notes that top institutions like Princeton in the US had a “needs blind” admission system which admits students based on merits, not financial capability. Financial assistance is provided to students who meet the admissions requirement but are unable to pay. Mr Ong says Singaporean students have benefited from these offers as well.

He noted that many universities in Europe offer free or heavily subsidised fees and scholarships for international students and there are currently about 400 Singaporeans studying in French and German universities, benefiting from the highly subsidised fees.

“We give some and take some,” said Mr Ong. “Our IHL cannot depart from this international practice norm and has to be part of this global education network.”

Later, NMP Associate Professor Walter Thesiera queried the Education Minister on the prospect of converting more foreign students into net fee payers. He said, “I think we can all agree that there’s going to be a pool of international talent we need to compete for and we need to give them some inducement to come but there could be other students out there who might be more than willing to come who can afford to be net fee payers. And in fact a lot of universities in the UK, US and Australia depend on a large volley of foreign students who are net fee payers and who will in fact subsidise the local students.”

In response, Mr Ong said that some of the foreign students in Singapore today are already net fee payers who do not receive tuition grants or scholarships.

Do the benefits justify the spending?

Mr Perera later pointed out that in some of the cases mentioned by Mr Ong, it is the universities that offer the financial aid for foreign students from their large endowments, not the governments. He then asked, “Given those points of reciprocity and being part of the network, can I ask if the ministry tracks or does the ministry know what is the comparable amount of government spending that other developed countries actually provide to other students studying in their countries proportionately as a percentage of their education budget?”

On this, Mr Ong said he does not have the figures on how much other governments spend on foreign students. “We can try to find out some numbers but there is no doubt that all systems around the world use their universities to attract talent, all over the world. And Singapore students are also targeted. There’s a fight for talent in the whole world. I think we can’t run away from that,” said the minister.

He also noted Mr Perera’s point that in institutions overseas, it’s the universities that provide the financial assistance instead of the government. Mr Ong explained that the system in Singapore is a little different as “autonomous universities are all government run”. “Ours is a more public and centralised system,” he added, unlike the state and private university system in other countries.

Mr Perera also questioned how the benefits of having international students are measured. Specifically, he asked if the Ministry of Education looks at the impact of spending on foreign students over time and if they know the economic multipliers of retaining high quality foreign students to later enter the workforce as compared to recruiting foreign talent from the open market without spending on foreign students in the education system.

To this, Mr Ong didn’t offer specific answers but welcomed the academia to study the matter. Even so, he said “we know this has been beneficial to Singapore. So it in the right proportion. Don’t overdo it, don’t under do it.”

Mr Ong then asked Mr Perera for his position on the matter and whether he or his party is advocating for a zero international student policy.

To this, Mr Perera said that his personal position is that some funding is for international student is justified but feels that the current amount being forked out by Singapore is on the high side.

He said, “To me it seems on the high side but I do keep an open mind because I think if the government can provide reasons that this practice generates, for example economic multipliers, that we attract foreigners to stay here who wouldn’t otherwise come, if there is data on what other government are doing, if the spending is comparable on the part of other governments so that there is reciprocity, we are doing our part as good global citizens, I would certainly keep an open mind to say that that figure is and that balance point is the right one.”