SXMElections.com

~ Govt to raise subsidy in 2016 ~

PHILIPSBURG--University of St. Martin (USM) outlined its dire financial situation on Wednesday, showing that the institution has been operating at an average deficit of some US $159,000 per annum over the past five years.

USM Manager of Finances and Operations Robert Budike painted the grim picture during a meeting of Parliament’s Permanent Committee on Education and Youth.

Budike suggested that an education surcharge similar to the St. Maarten Hospitality and Trade Association (SHTA) Dollar-A-Day programme be introduced in aid of the institution. He said the surcharge could be introduced at Princess Juliana International Airport SXM or at the Harbour.

“These are ideas to explore,” he told Members of Parliament (MPs). “But this can generate extra funding for USM.”

Budike said USM had cash flow issues, as its expenses exceeded its income. This, he added, leads to the tertiary institution being unable to live up to its commitments such as its payroll taxes and payments to vendors, amongst other things. Therefore, USM cannot compete with other institutions when it comes to hiring staff, as it cannot offer the same fringe benefits, he said.

About 40 per cent or $567,000 of the university’s revenues come from student tuition fees and 35 per cent or an average of $500,000 from Government subsidy and study financing. USM also receives some assistance from other sources such as businesses, amounting to an average of about 11 per cent of its revenue.

USM’s student body stands at 196, a decrease in enrolment compared to 2009 which counted 254 students. The reasons for the enrolment decrease can be multi-fold, he said. “One main factor was the international economic meltdown where students could not afford tuition fees, increase in unemployment in their target group and internal problems at the USM itself,” he told The Daily Herald.

Government’s current subsidy to USM stands at NAf. 850,000 per year, which represents an increase from the NAf. 500,000 USM had been receiving. USM had been receiving the latter amount for 25 years without inflation corrections, before the subsidy was increased last year.

According to Budike, salary payments eat up 78 per cent of USM’s revenue. It has 25 full- and part-time staff and 49 part-time faculty members.

USM charges $157 per credit for students who are residents and $190 for non-residents. One credit equals 15 hours of classes, which means the price per hour is about $10.47, which Budike said was “very low.” USM is reluctant to raise its tuition, as this would mean many students would be unable to attend the institution and enrolment probably would plummet.

An average of about 40 students graduate from USM each year. Its major programmes are its business programme and its Teacher Education Programme (TEP). Two-thirds of USM’s graduates are from these programmes.

Budike said USM had a structural financial problem that required a structural solution. “We have to increase enrolment,” he stressed.

USM is currently busy with new programmes to attract more students and cutting cost to reduce its expenses. Budike also outlined how many new faculty members USM needed.

Education Minister Rita Bourne-Gumbs said USM would receive an increase in its annual subsidy from Government next year, providing that certain conditions were met, including ensuring that some programmes are accredited. The amount of the increase was not mentioned.

Budike said USM’s subsidy increase had to be of a structural nature and not ad hoc.

“No additional subsidies mean that USM will remain a part-time university,” he stressed. “We have to drastically and structurally increase our revenues. We need an increase in study financing referrals. … We would like to discuss the options for the surcharge via Government-owned companies.”

At least one MP did not agree with the recommendation for the introduction of a surcharge. United People’s (UP) party MP Maurice Lake said in a press release issued Wednesday night that Bourne-Gumbs should reallocate funds from the approved 2015 budget for USM as well as increase its subsidy next year.

He said that if St Maarten is serious about education, priority should be given to the development of USM as what he called “a national university. … If we want USM to be the first choice for the students, then things should be in place. Students have to have the guarantee that their degree is recognised by other educational institutions.”