Describing funding income of Saxion University of Applied Sciences as a case study of Dutch UAS, income diversification and directions in applied sciences

1. Dutch Universities of Applied Sciences towards diversified income: Saxion UAS case
Siep Littooij1
Paper presented at the International Conference 2010 on Decentralization in Higher Education
from a Global Perspective: Implications for Vietnam and the Region; Sub-theme Diversification
of Resources,
Ho Chi Minh City, 29, 30 July 2010
ABSTRACT
The profile of Saxion University of Applied Sciences is representative of many other Dutch Universities of
Applied Sciences. Saxion UAS is a large multidisciplinary university, located in the East of the
Netherlands, predominantly teaching for Bachelor degrees in the professions. Saxion, when contrasted
internationally on diversity of funding sources, displays a high dependency on teaching income. Emerging
and stated categorical policies drive change in the Dutch higher education landscape, drive towards
enhanced applied research, more outward orientation all the time while enhancing educational quality.
Funding opportunities challenge the development towards external benefits of research, rather than
education enhancing knowledge generation, which is the natural propensity of staff. Saxion learns to deal
with research and acquiring research funding through the national RAAK programme, of which the
lessons learned include the need to pick a position on the knowledge value chain, to aim for state of the
art knowledge as a means towards success and to look at external demand articulation in a responsible
way. Moving towards diversified funding, the organization model adapts so that the Board remains in
charge of strategy and research finds strength in distinct organizational units. The university provides
centralized services to support diverse funding models, while culture changes are supported to
accommodate acceptance of funding diversity.
Dutch Universities of Applied Sciences towards diversified income:
Saxion University of Applied Sciences as case study
Dutch Universities of Applied Sciences (UAS) are defined by law as institutions of higher
education. Established mostly in the middle of the last century, some go back to teaching
institutions with over a century of history, while all have a history of mergers to grow to the
current sizes. The Netherlands now has 39 of these universities, out of a total of 53 universities.
The other universities are research or academic oriented universities. The Dutch universities of
applied sciences employ about 38000 staff and faculty and teach approximately 400000 students,
approximately 2/3 of Dutch higher education students.
Predominantly, students acquire Bachelor degrees in 4 years, including approximately 1 year of
practice. The universities take part in national experiments to develop and teach undergraduate 2-
year programs at the level of ‘Associate Degree’. A limited number of students continue on to
graduate with a professional Master. The UAS are either large multidisciplinary institutions with
regional coverage, alternatively are highly sector specific institutions that draw students into
specialist programs. The UAS teach for the professions and are engaged with the profession
through a host of mutual ties, for example with professional associations or economic sector
representations.
1
Manager International Project Desk, Saxion University of Applied Sciences, The Netherlands

2. The combined annual budgets (2005) amounted to approximately 2.7 billion euro, consisting for
more than 2/3 of state budget contribution, earmarked for teaching. The underexplored strength
yet of the UAS is the potential for applied research, a function that is only realized through non-
state funding. The budget contribution, provided as a lump sum, is calculated using a formulai
that includes student numbers and study performanceii. The remaining budget is generated as
tuition fees paid by students and third party incomes. The annual available budget amounts to
7.647 Euro per student.2
Total funding for UAS 2005
Fund type UAS NL 2005iii Saxion UAS 2009iv
Euro Share 2009 Share
(million)
Budgets 1851 68,2% 108234 68,0%
Tuition Fees 483 17,8% 31423 19,7%
3rd Party 201 7,4% 9252 5,8%
Other 180 6,6% 10272 6,5%
Grand Total 2715 159181
Saxion UAS, a product of the 90’s institutional mergers, is now operating across several cities in
the east of the Netherlands, with 13 schools. It teaches more 22.000 students (2009-2010) in more
than 55 Bachelor programs, 7 Associate Degrees and 15 Masters.3 With 6 research centers a
multidisciplinary research capacity has been established over the last decade.
The revenue in the year 2009 was a little over 159 Million Euro. The division over different
income sources follows the national UAS pattern, with slightly more income from tuition and less
income from 3rd party income.
Higher education policy in the Netherlands, part inspired by European policies, is slowly driving
change, and subsequently diversification, of universities. Most relevant driver of this change is
the impending change in the law on higher education, which will lead to a change in funding
regime. It is also expected that the law will redraw the boundaries of the binary system of
universities of applied sciences and research universities. The law is in draft form, has been
discussed since 2005, but has not passed parliament as of mid-2010. The Ministry of Education
Culture & Science (OCW) has issued two policy statements, driving towards applied research of
UAS and enhanced international linkages for all higher education. The applied research function
of UAS is to be realised in collaboration with (regional) employers and aims to strengthen the
role of UAS for regional knowledge contributions. The association of UAS, in the meantime, has
called for a higher education quality ambition. The national innovation system has a large number
of funds and programmes available with specific goals and procedures, to which all universities
are invited to contribute. This is collectively labelled here as the National Innovation
Programmes. By and large, European policies drive in the same direction, providing funding for
R&D and regional policies.
2
The annual available budget for Dutch research universities is approximately 23.085 per student, arrived at through
a different funding formula for students and different earning opportunities, for a much larger part spend on research.
3
The number of Bachelor programs as counted for full time four year students. Optional and partial offers increase
the number Bachelor programs.

3. To obtain an international perspective of funding diversity, it is useful to compare the funding
sources of Dutch UAS with (brief) data collected from European peersv, with a focus especially
on the research function, such as funded by either government grants or business contracts.
Standards and Poor’s assessment of total UK institutional income (2006) shows a 25% income
from government funding for education. With another 25% generated in tuition fees, the teaching
revenue amounts to just over half the budget. Roughly 28% is derived from funding for research,
sourced from a range of funding sources. Uniformly understanding the figures is difficult, given
different reporting statistics. Saxion UAS reports a figure of 7.105.000 Euro of research, both
grants and contracts in 2009, or 3.9% of the total budget. Leporivi shows that, comparing
aggregated and somewhat old data, Dutch University income from grants and contract is relative
to Europe a small proportion of income. Saxion then earns a very small part of its income this
way.
Lepori surveyed in 2007 the funding situation for European UAS, in order to formulate a funding
policy for Swiss UAS. Recommendations for the future funding of this type of institution build
on the binary divide underlying the mission and role the UAS in the national higher education
systems. He then challenges the research mandate and the shape of research activities, that is here
further paraphrased as:
“The ‘Lepori challenge’ to UAS grant funding strategy”
The challenge becomes clear by exploring the dilemma of the two research orientations known in
Higher education that emerge from the mission that knowledge is to be simultaneously developed
ánd taught. With UAS in binary national systems are predominantly operating as teaching
universities, they suppose their knowledge delivery to society is realized through the pathway of
Development / the environment Enhancement of teaching
• Customer demand driven: Customer • ‘supply’ driven for students : Generic
funded funding
• Focused on key (national) theme’s • Dispersed over all programmes
• Institutional co-funding in relation to • Institutional funding towards excellent
economic partners professionals
• Technology transfer to meet immediate • Technology development to meet
customer demands human capital demands in society

4. training students that enter the workforce upon graduation. Naturally such UAS are more
interested in the enhancing their teaching. Research universities find their pathway through
publications.
Surveying the Dutch funding landscape we can distinguish the different funding categories
embedded in the funding policies, aiming for specific funding targets. The table below lists,
without exhaustion, funding agencies or clusters of targeted funding programmes. The list on the
right is not only short, the funding programmes are relatively small; the spending categories are
comparatively narrowly defined.
Trends and opportunities for UAS, Targeted funding
Knowledge & Research for the economic Knowledge & Research for enhancement of
environment teaching
KNAW Platform Betatechniek
ZonNW SKE
FP7 EU RAAK
Innovation Platforms EVD
Delta’s & Valley programs NUFFIC
Industry & Business
Local government
EDF e.g. Interreg, EFRO
Given the policy environment that drives universities towards more applied research, coupled
with funding diversification and the search for autonomy, the Lepori challenge for UAS then
becomes clear. While the great majority of available funds drive the knowledge development for
the economic environment, universities that stick to their teaching mission have only a limited
chance to diversify their funding. The continuing dependence on teaching, with its associated
funding model, deprives then UAS from autonomous choices.
Universities that wish to escape this dependency are faced with a learning curve, not so much
because of their lack of research experience but from their engrained historic thinking mode that
supposes the benefit of research takes the student-oriented pathway of delivering knowledge to
society.
In the dialogue about the developing role and function of UAS in the Netherlands, OCW has
established a research fund designated only for UAS. This RAAK programme ‘Regional
Attention and Action for Knowledge circulation’ enables the UAS to gather learning experience
about the various issues that need to be addressed in research. The association of UAS has
established an intermediary foundation with employer organisation and research institutes also in
the board, to dispense the fund in a competitive allocation model. Funded since 2005, the amount
recently announced for 2010-1013 just surpasses 67 Million Euro.
The main ambition of the RAAK programme is to strengthen the UAS research capacity. Though
articulated somewhat concealed, the set of documentation lists goals that could be interpreted as a
desire to improve the demand ‘antenna’ of UAS among industry partners, stimulates the
participation in peer to peer networking, develop research methods and to share knowledge,

5. especially knowledge produced for specific target groups. Funding proposals must be submitted
as consortia, through which the relations between UAS and SME’s are reinforced, as well as
linkages with Academic University. Depending on the sub-type of the RAAK calls, core
consortium partners can amount to 10 companies, with peripheral partners up to 50
The challenges in the formation of consortia with industry partners force an outward look.
Meeting the proposal criteria for funding approval means that concrete research questions are
addressed as articulated by SME’s (or public organisations). Through the collaboration in
professional networks and industry clusters, UAS faculty has to acquire a much more precise
understanding of research and knowledge demands in his/her professional field of work.
Departing from the student oriented pathway of knowledge transfer, new processes of knowledge
circulation are to be identified and actively serviced. To succeed, faculty must have an adequate
understanding of the knowledge position they can deliver themselves. Alternatively they must
source knowledge in the scientific realm on one side, then on the other side share and contribute
to applications of knowledge in practice.
Reflecting on a few years implementation of RAAK, 3 strategic lessons are learned. First lesson
is the importance of the understanding of how knowledge circulation functions and what the role
of UAS means in the local environment. As a consequence, successful faculty manages to
position each funding application in the knowledge value chain. A second lesson is to have
aspiration and ambition in the knowledge function. Each research proposal will only be funded if
the ambition is to add value to state-of-the-art work by ‘others’ and translate knowledge into
applications that lead to success in collaborating industry organizations. The third lesson is that
external, as articulated by responsible and committed partners, can only be intercepted and
understood if the faculty see themselves and the UAS operate in an ecosystem. In such an
ecosystem the UAS with its different partners are relating interactively, each with an own
interest, but also living together in the local situation in such a way that is mutually supportive.
From these lessons and emerging conclusions, Saxion now recognizes and experiments with a re-
iterating two step funding acquisition strategy:
1. Act in dialogue; Working together with actors in local industry, the profession, the
community, developmental goals can be jointly identified and funding searched. The
knowledge sharing pathway with society becomes a two-way dialogue, in which students,
researching faculty and publications all are instruments. Funding agencies are also part of
local and national ecosystems. Saxion aims to participate in dialogue with partners and
about themes and topics that matter.
2. Acquire through competition; Local business works with the most knowledgeable and
ambitious partners, government agencies equally pursue funding for the most ambitious
proposals in progressing knowledge. Through the selective funding procedures, each
application must reach the highest standards possible. Saxion understands that for
translating the knowledge ambitions into funded proposals, market principles help to
move the ecosystem forward and aims to compete at the top of its capacity.
This strategy has emerged partly from the past experience with success and failure in funding
applications, partly by studying and anticipating the implications of the policy environment. The
implication of the funding acquisition strategy is that a diverse range of topics is pursued. Each
theme or topic has its own arena, in which the partners, the funders and the university all

6. participate. This results in a multiplication of arenas, both horizontally and vertically. Strategic
selection of pursued themes keeps the workload manageable. Matching the dialogue partners at
various levels and in various arenas is the operational challenge for Saxion in pursuit of funding
diversification.
Saxion is on its way to adapt to internally to diversifying funding. This is expected to yield
results in the near future, however much also still remains to be done. The current strategy
document, leading up to 2012, commits the organization strongly to an outward look. This is also
realized by the board, the members are actively pursuing participation in regional and discipline
specific organizations. More strategic guidance in fund acquisition is to be realized in the near
future, in part through steering research programming, in part through enhancing the funding
acquisition strategy. Through board participation in the local ecosystem, much information is
collected and disseminated about the position of the university. Feedback is coming in,
undoubtedly leading to fresh looks at the strategy beyond 2012. Internally, the board has
refreshed the perspective on the Planning & Control cycle to include not only regular expenditure
reviews but also income reviews.
Having centralized the organization in the early and mid-2000’s, now decentralization is gaining
strengths which leaves the organizational units with added tasks in research and fund acquisition
planning that were not visible before. Acquiring funds through competitive funding programs
now takes place in a consultative and strategic decision making process, that acknowledges
funder rules. The organization model shows a growing acquisition and administrative capacity
dedicated to externally oriented research. Professors and faculty are increasingly participating in
regional and professional networks and are busy opening up their research lines to adopt external
demand.
A serious effort is training additional project managers from a pool of staff or faculty that not
only have a professional role in the education-as-a-process organization, but also gain experience
in working in individual projects. With a few centrally appointed coordinators for research, for
project capacity development and for scouting funding Saxion is enhancing its capacity to acquire
a wider range of funds. Work is and still needs to be done to align further the general
administration function with project and funder requirements.
The main challenge for the near future is the culture of the institution. While research readiness is
growing and external demand articulation finds its place, an outreaching and entrepreneurial
attitude towards funding acquisition still has to reach a higher level. Internal processes and
attitudes towards both tangible and intangible costs/benefits of knowledge sharing through non-
students pathways needs still to sharpen up. For the near future, the debate about the optimal
pathway mix of providing knowledge to society will continue to challenge the funding strategy.

7. i
Factsheet Bekostiging Hbo, www.ocwduo.nl, accessed 14 June 2010
ii
Website www.HBO-Raad.nl, accessed 14 June 2010
iii
Financiering en financien van het hoger onderwijs 2000-2005, van Klaveren, D; CBS 2006
iv
Annual report and accounts 2009, Saxion 14 June 2009, www.jaarverslagsaxion.nl
v
Revenue Diversification and Sustainability: A Comparison of Trends in Public Higher Education in the UK and US;
Standard & Poor’s Performance Evaluation Services; Commissioned by The Council for Industry and Higher Education
(CIHE) December 2008
vi
Funding models of Universities of Applied Sciences; Rector’s Conference of Swiss Universities of Applied Sciences,
Benedetto Lepori 2007; Servizio ricerca USI-SUPSI, Lugano