Development of New Funding Formula in Malaysian Public Universities

Comprehensive funding reforms have been implemented by developed countries, resulting in major improvements in the implementation of their financial systems. Developing nations have also adopted the practice of evaluating the efficacy and shortcomings of their current systems of higher education management and public financial support. The pursuit of enhancing the efficiency and efficacy of higher education funding, with the aim of attaining enduring economic growth, has prompted the development of numerous policy reforms in both developed and developing nations. However, it is acknowledged by the Ministry of Higher Education that the current system needs to undergo changes in order to align with international developments. One of the measures undertaken by the Ministry of Higher Education is the alteration of the financing system for public institutions in Malaysia, with the aim of enhancing the correlation between performance and outcomes. The primary aim of this study is to analyse the formulation of a novel funding mechanism for public universities in Malaysia, with the intention of fostering a robust competitive environment within the public university system.