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Daily: Nobel laureate’s advice causes govt to walk back university education cuts

Government will dig into its coffers to provide hundreds of millions of euros in funding for universities and colleges of applied sciences. According to Education and Culture Minister Sanni Grahn-Laasonen, it was Nobel laureate Bengt Holmström’s sharp critique that influenced the decision to reverse course on plans to slash hundreds of millions of euros from university education.

Opiskelijoita pääsykokeessa.
Students during an entrance exam at the University of Helsinki earlier this year. Image: Mikko Koski / Yle

The Juha Sipilä administration has apparently decided to walk back a decision to gouge hundreds of millions of euros of funding from higher education programmes as part of its austerity programme.

According to the regional news consortium Lännen Media, sharp criticism of government’s plans by freshly-anointed Nobel laureate Bengt Holmström proved to be the lever that changed the administration’s plans.

The news service quoted Education and Culture Minister Sanni Grahn-Laasonen, who said that the government intends to follow advice given by Holmström to focus on university education.

"The government is planning funding for university education and basic research, as Bengt Holmström has advised," the minister said in an interview with Lännen Media. She added that she had been working with Economic Affairs Minister Olli Rehn on the matter.

Holmström: "Contempt for higher education"

In an interview with Yle after being announced co-winner of this year’s Nobel Prize for Economics, Holmström had expressed concern over the government’s decision to cut over 250 million euros in funding from education and research. At the time, he described the move as indicative of contempt for higher education.

Holmström advised streamlining the university sector to eliminate overlap among institutions, and called for research to be concentrated in a dozen or so leading research programmes.

The government’s about-face means that instead of slashing allocations for these areas, it will now pony up additional funding for them, in part by selling off some state assets.

Edit:There is a follow-up on this story with more details about the government's  funding plans for higher education here. The  government is aiming to provide capital for universities to invest, rather than additional annual funding.

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