Belov A.V. The Main Aspects of the University Reforms in Japan

The Main Aspects of the University Reforms in Japan

A.V. Belov

Reductions in public expenditure and the number of secondary school graduates in 1990-2000s promoted university reforms in Japan. As a result, a number of major changes in accessibility, quality and funding of university education have taken place. Japan`s experience in reforming could be useful for many countries, including Russia.

Key words: Japan`s universities, education accessibility, quality of education, funding of education, university reform.

At the beginning of 1990s, Japan was confronted with the shift in national and international environment of educational process. In particular, under the influence of population decline, the number of potential students declined. At the same time, against the background of globalization in public life, the requirements for to the quality of education increased. During extensive discussions key priorities and mechanisms for the necessary reforms was defined and their implementation began. Japan`s higher education system entered the period of change and became transitional. Over the past 20 years, Japan`s universities have gone through significant changes. All these issues will be reviewed in this article.

According to International Standard Classification of Education (ISCED) by UNESCO, the definition of higher and tertiary education includes all types of education programs beyond secondary level without any reference to any type of educational institution. Understanding of higher education in Japan is based on the definition by UNESCO, therefore, special vocational schools, colleges of different types and short-cycle universities are also defined as higher educational institutions. However, the subject of this article is limited to those universities, which offer 5A level programs (not less than 3 years, combination of theoretical, research and practical training) and 6 level (researchers training) in accordance with ISCED. In Japan, those are the institutions with study periods, correspondingly, 4-2-3 years (or longer for medicine, pharmacology and law), awarding BA, MA or doctor degree, or other equivalent degrees.

National system of education is understood as a complex of institutions (organizations and regulations, standards and rules), engaged in searching an acceptable compromise among the scope, financial costs and quality of educational services. In 2010, tertiary education covered 46, 4% of population aged 25 to 64 (an average in OECD states being 31, 51%)[1]. In 2012, Japanese 15 year-old school children scored 538 points in PISA`s tests on reading literacy (496 pains in OECD)[2], and 20 Japanese universities were among the best 500 universities in the world according to "Shanghai ranking" (the same number as in France) [3] Furthermore, the level of the overall expenditure on education amounted to 5, 1% of GDP, including 1, 5 % on tertiary education (6, %3 and 1, 7% in OECD)[4]. These data indicate that higher education in Japan is a massive phenomenon, provided on a high international level within quite modest budget. We consider an attractive price/quality ratio to be one of the key strengths of Japan`s system of education. Let`s try to understand the reasons of such phenomenon.

Short overview of Japanese universities

Initially, the establishment of Japanese higher education institutions was considerably influenced by the formation of the Humboldt University. It mainly involves the principles of state security, academic independence, a unique education and research study spectrum. After the Second World War the USA experience was broadly accepted, namely the standardization of educational institutions, development of private funding, introduction of degrees, academic credits and many other principles of organization, similar to American. 1960-1975 and 1991-1995 were marked by a rapid growth of private and public universities, as the ministry of education simplified the requirements for the establishment of new institutions.

The increase in their number was largely due to structural changes, i.e. through gaining university status by former colleges. Apparently, quantity expansion under weakening control undermined the quality of education. At least, in the second half of the 1990s, against the background of long standing depression, structural reforms and aggravation of financial situation, an unalterable opinion was formed in Japan, that the system of higher education did not meet the requirements of the time. In 2003-2004 there began the reforming of management structure, financing principles and techniques for the assessment of at first national and then other universities. These reforms in education were defined as Big Bang, and generated considerable criticism among conventionally conservative representatives of academic world. However, by the end of the decade, almost all intended measures were achieved, and the system of higher education was considerably renovated.

Nowadays, tertiary education in Japan includes several types of organizations, which can be classified by forms of ownership (state, public and private) and level of educational services provided (universities, short-cycle universities, different types of colleges, special vocational schools). Characteristics of the universities, which award bachelor`s, master`s, doctor`s degrees or other equivalent degrees, are given in Table 1.

Table 1. Quantitative characteristics of the Japanese universities (2011).

  Total State Public Private
Number of organizations 780 86 95 599
share (%) 100,0 11,0 12,1 76,9
Number of empoyees (persons) 76091 23948 3711 48432
share (%) 100,0 31,4 4,1 64,5
Number of students (persons) 2842167 608718 140965 2092504
share (%) 100,0 21,4 4,9 73,7
incl. students 2569716 450854 124502 1994380
share (%) 100,0 17,5 4,8 77,7
post-graduate students 272451 157864 16463 98124
share (%) 100,0 57,9 6,0 36,1

* The Ministry of Education, Culture, Sports Science and Technology of Japan (hereinafter - the Ministry of Education). Heisei 24 nendo monbu kagaku hakusho (White paper on Education and Technology 2012). Accessable at: http://www.mext.go.jp/b_menu/hakusho/html/monbu.htm.

Private universities dominate by their number in the system of higher education in Japan. However, qualitative assessments show that an absolute leading role belongs to state educational institutions. Such conclusion is based on a large number of regularly published rankings, which cover all aspects of university activities. Thus, the university popularity ranking and admission difficulty ranking since 1970s have been prepared by preparatory schools Kawai and Yoyogi, comprehensive assessment of universities` for candidates and their parents has been conducted by the Asahi Shimbun since 1994 , students and graduates` satisfaction with the quality of education has been evaluated by Recruit company since 1997, the university "brand" recognition has been ranked by the Nihon Keizai Shimbun newspaper, the quality of teaching and research work has been assessed by the Yomiuri Shimbun newspaper since 2008 , and the state of finance, facilities, opinion of employers for potential investors - by Toyo Keizai magazine. International positions of Japanese universities can be seen in such rankings as ARWU, THE, QS, Asian Universities.

According to all qualitative indicators, the top of the pyramid is occupied by state universities, and mostly by the former imperial universities of Tokyo, Kyoto, Tohoku, Osaka, Kyushu, Hokkaido, and Nagoya. They traditionally specialize in science education and fundamental research, and also train professionals for government institutions. Public universities, established and financed by regional and local authorities or public organizations, rank in an intermediate position. Among private universities two institutions - Waseda and Keio have world-class research base, while among the majority of others, there are big differences in scale, levels and area of the conducted researches. Such hierarchy and function division between Japan`s universities is widely acknowledged, steady and are unlikely to change in foreseeable future.

Since 2004 all state universities have a legal status of special corporations, operating in the sphere of education. They are managed by presidents (rectors) and board of directors (vice-rectors), who hold broad authority to determine the level and system remuneration of personnel and teachers, recruiting period, spending budget funds. Rector is elected by the board of directors or by the university staff from among the candidates, proposed by university structural subdivisions or by the founders. The members of the board of directors are appointed by the rector or the founders. Neither a rector, nor vice-rectors at the end of their terms of office (4-5 years, no more than 2 terms) are eligible to continue work at their university and are obliged to leave it. Faculties, postgraduate schools, affiliated institutes and secretariat report to rector and pro-rectors. Emerging issues are discussed at consultative management committees, committees for education and science which are complemented by independent experts according to appropriate procedure. The work of national universities is organized on the basis of the six-year medium-term plan, which whose performance report is annually reviewed by the State university organizations evaluation committee, established by the relevant ministry.

Following the state universities, the majority of public universities also assumed the status of special corporations and introduced similar structure of management, whose specific configuration is defined by the founders. Thus, the arrangement of management of state and public universities becomes close to what has traditionally existed in private ones (the supreme power is concentrated in the hands of the president and the board of directors, the advisory functions are in the hands of the board of trustees).

In the management of practically all areas of the university activities - from students` health care to defining the perspectives of future development - a prominent role is played by specialized committees, which include representatives of the faculties, structural subdivisions and administration. As a rule, the committee members` term of office is two years, and then there is a mandatory rotation. Therefore, every teacher is able to become acquainted with different facets of university activities during several years of his/her service. The functions of the committees are to prepare, discuss and make relevant decisions or adopt their drafts.

At the faculty level, the main governing body is an Academic Council. Its meetings are regularly held once a month, while extraordinary meetings are convened as required. Its powers may be divided in two groups - decision making (issues falling under the purview of the faculty) and advisory (any issues requiring an opinion of the faculty). Two facets of Academic Council`s activities, which are specific to Japan, should be noted: firstly, high quality of organizational and informational preparation, and secondly, the desire to take a decision by consensus (i.e. to continue the discussion until everybody runs out of objections). The first feature deserves the highest credit, as the distribution of the accompanying materials and draft decisions, mandatory approving of the minutes etc. demonstrate both remarkable information sharing among the teaching staff and a presence of an effective feedback. The second feature is attractive in theory, but in practice results in serious procrastination, and sometimes makes any decision-making impossible. It is, indeed, quite difficult to reach a consensus when no participant takes direct responsibility while the majority of them are eloquent and considered to be experts in university management.

The teacher recruitment is organized by the rector who does it by himself in some cases, but most often entrusts it to the faculties and approves their decisions. Before acquiring a corporation status, the state and public universities` staff were considered to be public servants of state, prefecture and municipal level. They were recruited on a full-time basis; the level and system of remuneration were equivalent to those for public servant of a particular rank (e.g. a professor equals to the head of a Ministry Department, prefecture or municipality). After 2004, a fixed-term contract employment, flexible payment and other changes have become possible. Instead of retired professors, many universities began to employ staff on a temporary basis with a lower remuneration (without bonus payments). This allowed saving money but led to negative changes in the structure of the teaching staff. However, in general, temporary employment and irregular wage systems are applied in limited cases, mainly to the staff of the affiliated research subdivisions.

The positions of teachers in Japanese universities correspond fairly closely to the European and American standards: teacher, assistant, assistant professor, professor. The decision on position awarding is rendered by the Academic Council based on the results of research and academic activities. The salaries are increased annually in accordance with their age and title. For instance, with all other conditions being equal, 45-year old professor earns almost as much as 50-year old assistant professor.

The retirement age is 60-63 at state, 65 at public and 70 at private universities. After attaining this age the staff is required to retire. Upon their retirement, the staff members of the state and public universities may become employed at private universities and continue for another 5-10 years. Contract amount and terms are determined individually.

The procedure for student enrolment is established by the universities and is stringent for popular and moderate for unpopular educational institutions. State, public and the strongest private universities take into account the results of the unified exam by the Assessment Center (a Japanese equivalent of the Unified State Examination in Russia) and the results of the 3-6 university entrance exams. The majority of regional, public and private universities also establish quotas for enrolment, based on the recommendation of local and affiliated schools and results of a small essay and an interview. The competition levels at the state and public universities constitute 4-5 applicants per place while the competition levels at private universities differ so significantly, that any average value is meaningless.

All types of entrance exams and university training are provided on a fee-paying basis. The government establishes an approximate fee for state universities, which are entitled to raise or lower it within 20%. Public universities are also guided by these numbers, while private universities define the fee by themselves. In 2010, an average one-year tuition fee at state and public universities constituted 535,8 thousand yen (about 5,7 thousand dollars), while in private universities it was 817,9 thousand yen (about 8,4 thousand dollars), including an entry fee in the first year. Roughly, 30% of Japanese students hold interest-free or low-interest loans for education; 1-2% are awarded with education grants. Moreover, universities apply discounts or exemption of tuition fee for a semester or a year to award outstanding students; however, such cases are rare. Tuition payment is made twice per year, a 2-3- month delay of payment leading to expulsion.

The awarded degrees are similar to those in the USA and the UK: bachelor (4 years), master (2 years), doctor (5 years), including other degrees awarded for a number of professions (2-4 years). The academic year starts in April and consists of 2 semesters, which end in September and March, respectively. The subjects are taught in April-July and October-January, August-September and February-March are assigned for exams, including internship, intensive courses and one-week vacations (there are also two-week vacations during New Year holidays).

During bachelor, master and specialist training a credit allocation and accumulation system is applied. The time-sheet of the teacher amounts to a number of credit points he/she provides to students throughout the year (16-20 credit points at state and public universities and 20-24 in private universities). One credit point is equivalent to 15 academic hours. A standard semester course includes 14 lectures (90 minutes or 2 academic hours) and an exam. There are usually written examinations which last as long as a standard lecture. As a rule, the ranking is done on a 100-point scale. A score higher than 60 allows a student to receive 2 academic credits. The undergraduate degree requires accumulation of 136 credit points (68 standard semester courses). Among them there are established quotas for English and a second foreign language, general and special courses of studies (the latter are subdivided into compulsory and selected subjects). As a rule, a university offers a wide range of subjects (from 300 credit points and higher) and students compile their own schedule by choosing from these subjects, taking into account the mentioned quotas.

The first two years are committed to general and theoretical education. During this period students accumulate an average of 70-90 credit points. Special training begins at the third year, the core of which is the participation in a two-year thematic seminar under the guidance of one of the professors. The choice of the seminar and the instructor is, probably, one of the most important and difficult steps during early period of study. The seminar is held once or twice a week for two years. The seminar instructor gives recommendations and characterizes the student to the university authorities, and generally implements "personified training" in practice. The graduation thesis is also prepared on the basis of the seminar; however it is not obligatory (at the discretion of the instructor).

Japanese companies begin the recruitment campaign for future graduates one year and a half before the graduation. Students set out in search of work, and have no time for university studies at the beginning of the fourth year in April or May. The universities have no choice but tolerate it, as a job opportunity outweighs the importance of academic success in the existing system of values. By June, 50-60% of the fourth -year students receive offers to join companies after their graduation, i.e. starting from April of the following year. Other students continue their search and about 80-95% of students find employment by the time of graduation (94, 4% as of 1 April, 2014).

Scope and equality of access to higher education

In 1930s-1940s, only 1-3% of school graduates entered universities and university education was of an elite nature. The post - war reforms contributed to raise this number to 9, 8% in 1956 and 10, 3% in 1960. Demographic changes, rapid economic growth and active government policy created opportunities for further growth of student number. By 1975, the percentage of student enrolment has almost tripled and reached 27, 5%, mainly due to private educational institutions. In those years Japan managed to dramatically expand the field of higher education, without raising government expenditures, but by shifting the financial burden to private individuals. Along with positive results, this led to a decrease in the quality, decline of facilities and tuition increase in the private sector. The government responded with a tighter control over the establishment of new universities, introduction of equipment standards and a system of state subsidies for private institutions. The percentage of school graduates applying for universities had fallen to 25, 1% by 1990.

In 1999-2000s, a new development stage of the system of higher education began, where two steps can be distinguished. Firstly, in 1990s the government simplified the process of conversion of colleges into universities and establishing universities by regional authorities, maintaining earlier adopted standards. It was then, that public (regional) higher educational institutions with good facilities and adequately trained personnel appeared in most prefectures of Japan. Secondly, in 2003, in the context of administrative reform the government took a step towards removing a number of former restrictions (for instance, to include a foreign language and physical training into the list of compulsory training). In fact, the government embarked on a course of laissez-faire policy in private segment of higher education and gave a green light to establishing of new universities. Governmental support of the universities decreased, but public pursuit if not to develop, but at least to maintain the achieved opportunities of university education, remained unchanged. This objective, as well as in 1970s, was achieved by widening and restructuring in the private sector. With regard to the quality of education, the government directed their resources to improving it in a small number of selected universities, and abandoned both strict regulation and wide support of the majority of private institutions. The costs /quality evaluation, as well as the decision to choose the university were granted to the consumers. This all means, that Japan`s education market entered the mature stage, when hundreds of various new players emerged on the supply side of the market, the consumers were given the opportunity of choosing from wide range of universities, and competition mechanisms made quality and cost balanced.

By 2011, 49.1% of school graduates continued to study at university. The expanding of scope was mainly due to those applicants who would earlier join different types of colleges. Further dynamics of this indicator would depend on of the number of those who are 18-year old, on the structure of tertiary education, opportunities of funding, and needs of the labor market and preferences of the population.

The number of secondary school graduates in Japan reached its peak in 1991 (1. 81 million people), declined to 1.21 by 2009 and is anticipated to fall to 1.09 by 2024. With an overall reduction of perspective students, the number of universities increased from 523 in 1992 to 780 in 2011, largely due to private educational institutions. Moreover, as of May 1, 2012, there was a lack of students in 246 private universities, with 18 of them not being able to recruit even half of the students[5]. It is no wonder, that competition for students forced a number of private institutions (mainly, small-scale universities in provincial areas of the country) to reduce the requirements to the applicants and give the opportunity to study to anyone who was ready to pay for the university course. The coverage percentage of school graduates by the university education has risen, but at the same time the gap in quality of education among the universities has become wider.

At the same time the number of applicants to short-cycle universities and special vocational schools was falling. The percentage of students continuing at these institutions shrank from 25% and 36% in 1991 to 6, 3% and 22% in 2011, respectively, while the number of institutions fell from 591 to 372. Such changes in preferences can be explained by economic factors. The likelihood of finding a new job increases exponentially with their level of education (in 2011, there were 61% of employed at the age of 24-65 having secondary education, 66% having secondary vocational and 68% having higher education), while the level of unemployment, in contrast, falls (5.0, 3.9 and 3.0% , respectively). Moreover, the salary of those with university qualifications is significantly higher than the salary of the staff with secondary education (by nearly 1, 5 times in 2007)[6].

Besides economic reasons one could note higher education rates for women, who used to constitute a major enrolment in short-cycle universities, and are now seeking comprehensive university education, as well as the objective to move training of nurses and social workers from colleges to usual universities. All these factors are still in force even today. Consequently, in the coming years, the tendency for substitution and replacement of colleges by usual universities will continue. However, further development will be determined by more profound economic and social changes.

In recent years processes at the labor market of Japan are featured by gradual deviation from traditional model of permanent (lifetime) employment. It is accompanied by expansion of short-time forms of employment (in 2011, the share of employed on an irregular basis reached 35. 2%), by increasing the number of young workers who change their employer within the first three years (from 9. 4% in 1999 to 15. 3% in 2003), as well as by reduced number of companies, which carry out intra corporate training (from 9.1% in 1994 to 5.1% in 2003). Moreover, companies are gradually shifting to recruiting experienced specialists instead of young university graduates, introducing other forms of training in place of intra corporate training. In particular, a traditionally small number of master and doctoral students in Japan are dipping even lower. In 2002, the number of postgraduate students was 8.9% in respect to the number of bachelor students (as compared to 13. 3% in Korea, 13.7% in the USA and 21% in the UK), but this share had risen to 10.6% by 2011.

In addition, the expectations of employers from the education system are also changing. While earlier the main criteria for employing the graduates was their ability to learn (which demonstrated not as much the content of education, as the fact of having been accepted to the prestigious university), recently such qualities as leadership, decision-making abilities and communicative skills (something that Japanese businessmen usually lack) have become more required. Though the development of such qualities depends not on education, but rather on upbringing, employers` representatives most often tend to put the blame on the last educational level, if such qualities are missing. Before the beginning of the reforms these were the business communities and representatives who were most strongly critical towards university system, calling for reforms[7].

The degree of accessibility also has a great influence on attracting population to universities. Compared to other OECD countries, Japan showed a significant success achieved in this sphere. First of all, by the beginning of 1990s, an equal access to education had been achieved at primary and secondary levels of education. The dependence of school students' knowledge on theirs social background or on the income of their parents was less prominent in Japan, than in other OECD countries[8]. Furthermore, corruption or any rules abuse when entering the universities or taking unified exams (Japanese equivalent of the Russian Unified State Examination) are almost completely impossible in Japan[9]. Finally, there has been established a system of various institutions of tertiary education, providing broad opportunities of education to all who is wishing.

A relatively even geographical distribution of the educational institutions also plays a prominent role in enforcing equality in access to education. This dates back to many years of government planned policy, particularly aimed at establishing at least one state university in every 47 prefecture. Overall, in 2010s, Japan's main objective related to accessibility of education, was to preserve the achievements, and to address a number of existing problems thereafter[10], according to OECD experts.

The most important issue is that serious gender differences still persist. Thus, in 2009 there were 51.3% of male-graduates and 36.8% of female graduates enrolled into universities. 15.1% of male university graduates and only 7.7% of female university graduates took up postgraduate study. Female professors constitute only 10% of the total number of university professors (6.1% at the state universities). It will take a long period of time to downplay such differences. It will also depend on a great variety of factors - from dynamics of female employment and amount of "reward for education" to a change in a style of relations in an academic sphere and improvements which enable achieving a more equitable balance in allocation of time between home and work.

The second issue relates to reinforcement of social differentiation. We will pay attention to only one of its aspects. In Japan, total family expenses for raising a child beginning from his birth until his graduation from the university reach 21 million yen (about 200 thousand dollars) with an average annual family income of 5.7 million yen (about 53 thousand dollars in 2005). During the school education period the largest part of the family budget goes to private training courses which prepare pupils for examinations at prestigious schools and universities. Thus, household income determines the level of children`s supplementary training, and therefore, the choice of educational institution which they could enter. Expensive preparatory courses, as a matter of fact, could be substituted by self-study at home. However, this requires a child to be systematically focuses on education which not every family considers to be an important issue. In this regard, it is no wonder that 60% of children of the "professional" parents graduated from universities in 2000s as compared to only 15% of children of those working in agricultural industry[11].

Until recently government`s policy did not provide any effective measures to minimize these differences. Therefore, the expansion of system of university education in 2000s occurred mainly at the expense of middle and highly-paid population, while the opportunities for university studies for low-paid population groups did not expand. Taking into consideration such factors as a deepening income inequality, stagnation of real personal income, high costs of pre-university training, restriction of opportunities of government financing, and, finally, relatively high and constantly growing tuition fee, it is clear, why the specialists predict, that the access to university education for the children from households with low income will not expand in future[12]. Thus, certain achievements in providing equal access to education which Japan was rightly proud of, turned out to be lost in 1990-2000s.

In other countries, where education must be paid for, the equality in access to education can be regulated by providing financial assistance to the students. In Japan, however, the system of the fellowship grants and stipends is rather poorly developed (it covered only 3% of students in 2010-2011). Interest-free or low interest loans are also received only by approximately 33% of college and university students (with 71% in the UK and 76% in the USA). Moreover, as a rule, the loans must be paid off (by fixed monthly payments) within 5 years after graduation, irrespective of the income of the former student. It is evident, that given a decline in real income and uncertainty about the future employment, such a scheme reduces the leveling effect of the loan system[13].

Financing of university education

Financing of university education in Japan is featured by a relatively low expenditure in respect to GDP, a low share of costs in budgets at all levels, as well as predominance of private sources (Table 2).

Table 2. Higher education finance indicators (2010)

Indicator Japan Russia Korea France USA OECD
Education finance (% GDP)
All levels of education 5,1 4,9** 7,6 6,3 7,3 6,3
Tertiary 1,5 1,6** 2,6 1,5 2,8 1,6
incl. colleges 0,2 0,2** 0,3 0,3 ... 0,2
Universities 1,3 1,4** 2,3 1,2 ... 1,4
Share or expenses in the budgets at all levels (% GDP)
All levels of education 8,9 ... 15,3 10,4 13,3 13,0
Tertiary 1,8 ... 2,6 2,4 3,0 3,1
Share of expenses by source of funding (% GDP)
All levels of education            
Public sources 3,6 4,1 4,8 5,8 5,1 5,4
Private sources 1,5 0,8 2,8 0,5 2,2 0,9
Tertiary            
Public sources 0,5 1,0 0,7 1,3 1,0 1,1
Private sources 1,0 0,6 1,9 0,2 1,8 0,5

*OECD. Op.cit
** Only public expenses.

The Education expenses vs. GDP ratio make 5.1%. In terms of this indicator among the countries of OECD Japan outstrips Turkey, Greece, Hungary, Czech Republic, Slovakia and Italy (2.5% - 4.7%), but lags significantly behind the average in OECD (6.3%) and such leading countries as Denmark (8.0%), Korea (7.6%) or the USA (7.3%). Moreover, most countries are ahead Japan in terms of growth rate in expenditures (in 1995-2010, it was 0. 9% on the average in OECD and 0.2% in Japan). Public expenses on tertiary education make 0.5% of GDP (the lowest level among OECD countries and G-20 countries whose data are available). The share of expenses in budgets at all levels is also low (8.9%) and is steadily decreasing.

In OECD countries the major financing burden of tertiary education falls on private sources, though there had been a trend in recent years towards transferring a part of expenses to the private level. Thus, from 2000 to 2010 the share of public funds in OECD had dropped on average from 77. 4% to 68.4%. However, in Japan, similar to many other countries of East Asia, education in general and university education in particular are traditionally supported by family budgets. Private funds covered 65, 6% of spending on tertiary education (51.5% and 14, 1% being family funds and funds of private organizations, respectively) in 2010.

It is not hard to imagine, how severe the challenge to education funding in Japan is. Expanding of the private sector funding also comes up against uncertain development of economy and stagnation in the real income. The greatest challenge in the public sector of funding is related to consistent excess of expenditure over the income and a huge amount of public debt whose volume (including regional and municipal debts) climbed up to 220% of GDP in 2012. The features of finance system in Japan (low burden taxes, the structure of debt and concentration of shares in the hands of national investors) do not allow considering the situation appalling so far. However, the problems of such scale cannot be solved without reduction in all lines of budgets expenditures, including education.

The latter process, as mentioned above, has already started. In addition, the corporatization of state and public universities, which started in 2004, was accompanied by reducing budget allocations for operating costs by 1% yearly. Most importantly, universities were no longer subordinated to the ministry; the staff members lost their status of public servants, which in practice provided legal grounds for further reductions.

It is evident, that the decrease in the amount of financial resources requires improved efficiency. This is a question of mergers and enlargements of the universities, realigning budget financing towards profitability analysis, use of a more flexible tuition payment system, diversifying the income of educational institutions and reinforcement of the focus of university management on efficiency issues. According to some experts, Japan has a certain room for improvements in every mentioned sphere[14].

In particular, despite the reduction in a number of state universities from 101 in 1997 to 86 in 2011 (mainly, by transforming independent medical institutions into the faculties of the neighboring state universities), there are still 40 "local" and 36 "vocational technical" universities, which are usually located near prefectural or other public institutions. Prefectural universities are not large (with the average number of 1600 students); half of them have only one faculty. From a political perspective, consolidation of local state and prefectural universities presents a challenging issue. However, economic benefits from such measures are quite obvious. Activation of mergers and acquisitions is viable not only in public but in private sector as well. At least the Association of Private Universities of Japan identifies such measure as "the most effective means to revitalize the education institutions of concern"[15]. In spite of it, Japan saw only 6 private university corporations' merger cases from 2002 to 2011.

Following the reform of state universities the Ministry of Education introduced the system of competitive distribution of funds for scientific research and innovations in education. In 2006 they formed 17, 6% of the tertiary education budget. Other funds were distributed according to the number of students, teachers and asset holdings, i.e. on a cost basis. In a common medium-size state university, the sources from competitive biddings constituted about 10% of the subsidies, granted by the ministry for administrative costs; their share in the overall budget did not exceed 3%. Among public funds, allocated in the form of subsidies to private education institutions, about one third of them were distributed based on competitive selection.

All types of entrance exams and university trainings for applicants and students from Japan are charged for. The government defines an approximate fee for state universities, which are entitled to raise or lower it within 20%. These numbers, as mentioned above, are also the benchmark for private universities, which define the fee by themselves.

Despite the right to change the fee within 20% only few state universities use this opportunity. Public universities, which are even not subject to regulations, still charge the same fee as the state ones. There are no differences in payment depending on the level or popularity of the institution, demand for its services or the cost of a certain education program etc. The Ministry of Education views such practice as necessary in order to achieve equality. Such a position is criticized by the experts, as it results in funding most well-off and education-oriented households where children usually attend prestigious state universities.

The structure of private and state universities` income in Japan differs significantly. Government subsidies constitute about more than a half (55.4%) of state institutions` income, while private universities receive almost a similar percentage (55.7%) by means of tuition payments. Student attendance and supplementary education even in private universities constitute such a small part of income base, that it is hard to capture it statistically. The same applies to private donations. A few years ago Japan introduced significant tax benefits with regard to private donations and other similar contributions. However, the culture and the habits of Japanese individuals and companies are changing very slowly, which falls short of expectations, laid on charity as one of new sources of income in the corporatization process of universities (Table 3).

Table 3. The structure of current income of universities in Japan (%, 2005)

Sources of income State universities Public universities* Private universities
Government (all levels) 55,4 76,4 10,7
Tuition fee 16,2 23,5 57,0
University hospitals 27,9 0 23,7
Private donations and grants 0 0 0,0
Supplementary education** 0,6 0,1 2,9
Student attendance*** 0 0 0,0
Endowment 0 0 2,2
Others 0 0 3,5

Newby H. et. all. Op. cit. P.47; Moriya Toshiharu. Daigaku keieiron (University management). Tokyo. 2009. P.238; Hirota Teruyuki and others. Daigaku to kosuto (Universities and tuition costs). Tokyo. 2013. P.98.
*the average for three largest universities;
**supplementary educational services, beyond the general program;
*** housing, health-care, social and other services.

The variations in income structures can be explained by the differences in financial policies of state and private universities. The former can take some time to adjust to annual cuts in state funding and to make a difficult decision to increase the tuition and the number of admitted students against the background of reductions in cost and salaries and growing academic workload. The latter seem to have already exhausted all most obvious ways of improve their efficiency. The future of 30-40% of tertiary educational institutions is most often defined as "restructuring", which implies the development of inter-university cooperation, intensification of mergers and acquisitions, as well as the spreading cases of university bankruptcy, which is, so far, a rare event in Japan.

The quality of education and measures of its improvement

The quality of education in Japan often becomes the subject of active discussions, despite the fact that there are still no integrated and widely accepted techniques for its evaluation. Among existing objective indicators we may perhaps mention PISA program of testing knowledge of 15-year old students (since 1993) and a "Shanghai" university ranking ARWU (since 2003). PISA research reveals a significant reduction in all evaluated parameters in 2003-2006 and their improvement in the following years. In 2012, Japan came in the 7th place in mathematics (1st in 2000) and the 4th in natural sciences (2nd in 2000)[16] among member states. In the Academic Ranking of World Universities among the 500 best universities in the world there were 35 Japanese universities due to academic achievements in 2003, while there were only 20 in 2013. Apparently, it is this dynamics, which is meant, when they speak about the decline in the quality of Japanese education, which is especially noticeable given the rapid progress of China and Korea. The main reason is likely to be the above mentioned insufficient funding. Moreover, it is also important to point out a relatively late launching of the reforms (the objective to have 10 universities among the 100 best in THE ranking was defined by the Ministry of Education only in November 2013), and mixed results of implemented reforms. Let us delve deeper into the last remark

There are different measures taken to improve the quality in the system of higher education. Among them are assessment of universities, incentives for workers, internationalization, competition-based funding and concentration of research activities in a limited number of centers, selected on and a competitive basis.

From the late 1940s to early 1990s, the assessment of universities in Japan was conducted only once - at the stage of their establishment. Since 1991, a procedure of self-assessment was introduced and became compulsory in 1999. The mechanism for establishing new universities was gradually simplified. The next step that was taken in that direction in 2004 included the overview of minimum requirements towards newly established educational institutions ("university standards") with regard to their organizational structure, qualification of the staff, facilities, education programs, number of students etc. Concurrently, a requirement was imposed which made universities undergo a compulsory evaluation in one of the specially established licensed organizations every 7 years. In the school year of 2013-2014, there were 8 associations entitled to conduct the assessment (three universal and 5 professional) by using their own methods. In general, all this constituted a relatively well-developed and multi-level system of university assessment.

The assessment has triggered to take a series of measures to improve the quality of education on the university level, such as creating of short description of the delivered lectures (syllabus), formation of faculty "methodical commissions" (FD - faculty development), organization of students` evaluation of training sessions, discussion of separate lectures by the teachers, sharing of experience and best practices in teaching techniques. As a result, over the last 10 years, there has been a drastic change in the style and organization of education process, especially in state and public universities. Perhaps the greatest progress was achieved in the sphere of engineering specialties, where the accrediting organization established in 1999 (JABEE - Japan Accreditation Board for Engineering Education) introduced a set of international requirements into the teaching of certain subjects. However, in the sphere of human sciences, many Japanese universities are still at the start of their journey towards becoming open educational institutions, which allow objective assessment of teaching quality.

Following the assessment of educational institutions in many states and public universities certification of teachers has been introduced. As a rule, its mechanism is developed by the universities and is based on a number of criteria, subdivided into four groups: scientific activity, teaching, university management and contribution to the development of the territory (state). Every teacher assesses himself/herself annually with reference to the established criteria and submits the data to the faculty appraisal commission, which takes the final decision. The results of the assessment are used during the distribution of university funds for researches, and in some universities even have an impact on the salary, for instance, when determining the level of annual raises in salary in accordance with age and length of the employment service.

The internationalization in Japan is rightly considered to be an essential bridge to improve the quality and international competitiveness of education. This sphere includes a variety of different measures - from training Japanese students abroad to presence of foreign education institutions in Japan. However, the priority areas are enhancement of language training (for instance, by offering courses in English which is practiced by 300 universities), formation of Global 30 among Japanese universities which are specially selected institutions which would play the role of the internationalization centers (practical steps were taken in 13 universities by 2013) and expanding the number of international students.

In our view, among the above mentioned priorities most illustrative is the fact of expanding of education for foreign students, as this sphere involves not only the issues of competitiveness of education, but also state funding, the issues of linguistic and social background, immigration and labor laws. The first plan for attracting foreign students to Japan was formulated in 1983 and implied the expanding of their number from 10 to 100 thousand students by the beginning of the 21st century. The plan was technically implemented, and there were 109.5 thousand foreigners studying in Japanese universities by 2003. 93% students came from Asian countries and more than two thirds of them were from China. Only 20% received State scholarships and 25% housing allowances for the dormitory accommodation, others covered studies and living expenses on their own. The highest increase (almost 50 thousand people) was in 2001-2003, when the delays in implementation of the plan lead to simplification of student visa procedure and increased scholarships. In 2008 the number of foreign students climbed to 123.8 thousand people, while the government had developed a plan to increase this number up to 300 thousand by 2025. This would allow raising the number of international students from current 3.3% to 7-8%, which corresponds to an average of OECD countries (7 3% in 2006). Apparently, the most difficult challenge in the implementation of the plan could be the employment of potential graduates. In 2011, there were 8586 labor visas in Japan issued for the students who had found a job after the graduation. In theory, it is quite possible to rise this figure by 4-5 times over the next 15 years, however in practice this will require innovations in the employment policy, legislation and Japanese society in general. It is such changes, which are necessary to overcome primarily domestic nature of modern Japanese education.

Research development funding in Japan reaches 3.36% of GDP. This is far ahead of the averages of OECD (2.4%) and the averages of the countries with comparative economical and science capacity (2.9%, the USA, 2.82% in Germany as of 2009)[17]. However, the main burden of research funding in Japan is traditionally carried by private companies (2.53%), while the share of public funding has significantly fallen behind the averages of OECD (0.73%). Such structure affects the content of carried out researches (predominance of applied researches) and pre determines a relatively modest participation of universities in R&D activities.

Since 2004, most attention in the field of university science has been focused on introduction of grant financing (197 billion yen in 2009) and establishing 28 academic centers of excellence (COE) in a number of universities. In general, the funding of tertiary education has declined from 2090 billion yen to 1874 billion yen from 2001 to 2009, however, the part of the resources distributed on a competitive or priority basis has risen from 14 to 29%. This laid a good foundation for a competitive system of financial support. However, the experts note, that with the overall share of funding being reduced, the concentration of resources in a small number of selected institutions will most likely lead to the expansion of the gap, than to the improvement of the average level of research. The mobility of staff and international cooperation in Japan are too weak, and the leaders do not pull up the outsiders, but on the contrary, break far away from them. Moreover, particularly unsatisfactory is the situation when grants are concentrated in an overly small number of projects, which results into "over financing" of one research and desertification of other spheres. Finally, the project application and report submitting procedures take a lot of time and effort which could be used for research or teaching. As a result, Japanese academic society has not yet developed a unified assessment of competitive financing.

A similar pattern - significant organizational work and modest qualitative indicators of achievements - is observed in many fields of research reorganization. For instance, the mobility of university workers is still low (52.5% of them are employed by one organization during their whole life), urgent contractual employment is also relatively uncommon (6% of workers), and the number of university joint research on contracts from the companies is low (2.6% of university research budget vs. the average of 6% in OECD). Consequently, the objective to increase the mobility of researchers and transparency of employment, to improve competitive financing and to promote the ties with industry is still not less important today, than it was during the initial period of reforming.

The difficult situation in education quality is also reflected in the Time Higher Education (THE) ranking. There were 5 Japanese universities present among 200 best universities of the world over the period from 2010/2011 to 2013/2014. During this period the most prestigious universities of Tokyo and Kyoto have climbed from 26th to 23rd and from 57th to 52nd rank. However, the positions of other three universities (Tokyo Institute of Technology, Osaka and Tohoku universities) have considerably deteriorated which resulted in falling an average ranking of Japanese educational institutions - from 89th to 99th rank[18]. These results illustrate the view, that the outcome of the implemented reforms is uncertain and there is a need for serious work in future.

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Therefore, the example of Japan confirms, that the volume of spending, the level of quality and the scope of access to higher education are closely interdependent. The reduction in public funding and the reforms of 1990-2000s have resulted in expansion of educational services in the private sector, accompanied by the reinforcement of differentiation of Japanese universities. The search of balance between cost, quality and social characteristics of educational process will be continued in the future and is likely to take quite a long time.


[1] OECD. Education at a Glance 2013. Available at: http://www.oecd.org/edu/eag.htm

[2] PISA 2012 Key Findings. Available at: http://www.oecd.org/pisa/keyfindings/pisa-2012-results.htm

[3] Academic Ranking of World Universities 2013. Available at: http://www.shanghairanking.com/

[4] Ref.to. Belov A.V., Zolotov A.V. Economical aspects of university activities in Japan// The issues of education. 2014. No.2 (in press).

[5] Japan Times. 4.12.2012.

[6] OECD. Op.cit.

[7] Amano Ikuo. Daigaku: chosen no jidai (Universities: an era of challenges). Tokyo, 1999. P.16.

[8] Ichikawa S. Distinctive Features of Japanese Education. National Institute for Educational Research (NIER) Occasional Paper, 1991. Available at: http://www.nier.go.jp/English/EducationInJapan/Education_in_Japan/Education_in_Japan_files/201103DFJE.pdf

[9] During his 16 years of work the Author learned from newspapers only about one case of using the test papers of future unified exam at the preparatory courses.

[10] Newby H. et.all. Japan. OECD Reviews of Tertiary Education., 2009. P.54.

[11] Okada A. Education Policy and Equal Opportunity in Japan. Berghahn Books, 2011. P.140, 145, 158.

[12] Ishida H., Educational Expansion and Inequality in Access to Higher Education in Japan. Tokyo, 2003. P.57.

[13] Newby H. et.all. Op.cit. P.58.

[14] Newby H. et.all. Op.cit. P.42.

[15] Iwasaki Y. Shiritsu daigaku seihen no genjo: to shiritsu daigaku saihen no tame no seisaku kento: (Restructuring of private universities and analysis of policy to revitalize private university corporations)// Research on Academic Degrees and University Evaluation. No.8 (December 2008). P.105.

[16] In 2000 in Japan there were reductions in the curricula of the secondary schools in order to make some time for «creative activities». As a result, there was a decline in the training level of the students in all major subjects; it evokes a wide response among the public, and by 2010 the volume of the curricula was restored to the same level. This was captured by positive fluctuations of the PISA testing. This is considered to be an example of a failed experiment, which consequences were duly addressed to thanks to effective feedback in the system of education.

[17] OECD. Main Science and Technology Indicators. Volume 2011/2012. Available at: www.oecd-ilibrary.org/science-and-technology

[18] Times Higher Education (2014) THE World University Rankings 2013-2014. Available at: http://www.timeshighereducation.co.uk