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№ 5/2018

№ 5/2018

Fìnansi Ukr. 2018 (5): 8–21



1SESE “The Academy of Financial Management”
OrcID ID :

Discussion aspects of formula distribution of state expenditure on higher education in Ukraine

The changes made to the Budget Code of Ukraine in 2017 fixed the transition to the distribution of state budget expenditures for higher education on the basis of the formula. This stepped up the development of design of the formula, as well as discussions on the choice of performance indicators of the universities, on which it should be based. It is substantiated that the transition to the allocation of state financing between universities in Ukraine by the formula will, of course, increase its transparency and predictability of the amount of financial resources that each educational institution can receive, creating favorable conditions for planning its activity. In addition, use of performance indicators in the formula will stimulate universities to achieve them. However, the formal adaptation of higher education institutions to a new funding mechanism, as evidenced by the experience of countries that have long introduced funding under the formula, does not yet indicate a real improvement in the quality of educational services. Ultimately, the effectiveness of formula funding largely depends on the indicators upon which it is calculated – their measurability, reliability of sources of information, and the effects of the impact on the behavior of providers of educational services. Taking this into consideration, the aim of the article is to study discussion issues about the selection of particular performance indicators. The analysis of the indicators used in developed funding formulas shows that each of them has both advantages and disadvantages. During the research it is proved that the latter can be reduced by: using a set of indicators (for example, both quantitative and qualitative) that meet the criteria of accuracy, non-manipulability and relative cheapness of the calculation; use of different weight coefficients for different indicators (including higher weight coefficients for more important indicators); one-time use of one or another indicator (for this reason it is grounded that it is impracticable to use the indicator of the level of the results of external independent evaluation in the formula for allocating state funding, since it is the main indicator determining the distribution of state procurement between universities and hence the value of such indicator as the contingent number of applicants of higher education under state procurement, appearing in the formula); the use of the indicator that most adequately characterizes one or another result (for this purpose it is proposed to change approaches to the definition of the indicator of the scientific activity level, in particular, to take into account in the formula publications in the professional editions of Ukraine (categories “A” and “B”) and those registered in scientometric database Scopus or Web of Science with a low SNIP index separate from scientific publications registered in the Scopus or Web of Science with a high SNIP index).

Keywords:performance-based funding, funding based on previous year spending, funding formula, performance-based indicators

JEL: H52, I23, I25

Sokolovska A. . Discussion aspects of formula distribution of state expenditure on higher education in Ukraine / A. . Sokolovska // Фінанси України. - 2018. - № 5. - C. 8-21.

Article original in Ukrainian (pp. 8 - 21) DownloadDownloads :208
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