Public institutions charge no tuition fees for bachelor’s or equivalent programmes in nearly one-third of OECD countries and economies with data. In a similar number of countries, annual tuition fees are below USD 2 000, while in the remaining countries, tuition fees range from about USD 2 600 to over USD 8 000 per year.
Short-cycle tertiary programmes often represent a cheaper alternative to bachelor’s programmes and tend to be more oriented towards specific professions.
In Australia, Denmark, New Zealand, Norway and Sweden, at least 80% of national students receive public financial support in the form of student loans, scholarships or grants. In the last decade, the share of students receiving public financial support increased by at least 14 percentage points in Chile, Denmark and Italy, while the share remained stable in all other OECD countries and economies with available data.
Education at a Glance 2020
Indicator C5. How much do tertiary students pay and what public support do they receive?
Highlights
Context
OECD and partner countries have different approaches to providing financial support to students and to sharing the costs of tertiary education among governments, students and their families, and other private entities.
Tuition fees bridge the gap between the costs incurred by tertiary educational institutions and the revenues they receive from sources other than students and their families. Many factors may influence the level of costs, including the salaries of teachers and researchers, development of digital learning and non-teaching services, changes in demand for tertiary education, investments to support internationalisation, and the amount and type of research activities undertaken by faculty and staff. Tertiary institutions partly cover their costs through internal resources (endowments) or revenue from private sources other than students and their families (see Indicator C3). The remainder is covered by student tuition fees and public sources.
Public support to students and their families can be a way to encourage participation in education, while also indirectly funding tertiary institutions. Channelling funding to institutions through students may also help to increase competition among institutions and encourage them to better respond to student needs. Support for students comes in many forms, including means-based subsidies, family allowances for students, tax allowances for students or their parents and other household transfers. Governments strive to strike the right balance among these different subsidies, especially in periods of financial crisis. For a given amount of subsidies, public support such as tax reductions may provide less support for low-income students than means-tested subsidies, as tax reductions are not targeted specifically at low-income students. However, such measures may still help to reduce the financial disparities between households with and without children in education.
Other findings
In over one-third of countries with available data, tuition fees are at least twice as high in independent private institutions as in public institutions.
In recent years, OECD countries and economies have passed several reforms to improve access to tertiary education. Chile, Italy, Greece, Korea and Portugal implemented measures to expand access to tertiary education to students from disadvantaged backgrounds, while New Zealand increased public subsidies to make the first year of tertiary education free of tuition fees for new students or trainees. England (United Kingdom) has expanded its income-contingent loan programmes.
Among countries with data available, the average amount that students borrow ranges from USD 2 400 a year in Latvia to over USD 10 000 in England (United Kingdom) and Norway (where tuition is free of charge and loans finance students’ living costs). Scholarships or grants received by students range from less than USD 1 000 a year in Estonia and the Slovak Republic to over USD 7 000 in Australia, Austria, Denmark, Switzerland and the United States.
In over half of the countries with available data, tuition fees for bachelor’s degrees in public institutions have increased by at least 15% over the past decade. In Canada, Italy, Spain and the United States, tuition fees for the academic year 2016/17 (2017/18 for Canada and Italy) were between 25% and 46% higher than in 2007/08 while the largest increase was observed in England (United Kingdom), where tuition fees tripled over this period.
Analysis
Differentiation of tuition fees
Differentiation by type of degree
Entry into tertiary education often means costs for students and their families, both in terms of tuition fees and living expenses, although they may also receive financial support to help them afford it. Most national students entering tertiary programmes enrol at bachelor’s or equivalent level in OECD countries (see Indicator B4). Public institutions charge no tuition fees to national students in nearly one-third of countries, including Denmark, Finland, Greece, Norway, the Slovak Republic, Slovenia and Sweden (Figure C5.1). In a similar number of countries, tuition fees are moderate, with the average cost for students below USD 2 000. In the remaining countries, tuition fees range from about USD 2 600 to over USD 8 000 per year. They exceed USD 10 000 in England (United Kingdom), where the majority of students enrol in government-dependent private institutions (Figure C5.1).
In many OECD countries, short-cycle tertiary programmes are expanding, with higher first-time graduation rates at this level in 2018 than in 2010 (see Indicator B5). These programmes consist mostly of tertiary-level vocational education and training and therefore prepare students for specific occupations. Short-cycle tertiary programmes offer slightly less positive employment prospects and earnings than other tertiary qualifications (see Indicators A3 and A4), but they provide a shorter and cheaper tertiary education and, in a number of countries, a better benefit-to-cost ratio than long-cycle tertiary programmes such as bachelor’s and master’s (OECD, 2019[1]). Tuition fees for short-cycle tertiary programmes in public institutions are generally much lower than for bachelor’s programmes. Generally, they are free of charge in Denmark, France, the Slovak Republic, Slovenia, Spain and Sweden and they amount to less than half the tuition fees for bachelor’s programmes in Chile and the United States, where they are below USD 3 500. In contrast, tuition fees for short-cycle tertiary programmes in public institutions are the same as for bachelor’s programmes in the Netherlands and Portugal. In Norway, short-cycle tertiary is the only tertiary programme that is not free of charge (Figure C5.1).
Higher tertiary education after a bachelor’s degree leads to better labour-market outcomes. Graduates with a master’s or doctoral or equivalent degree have better employment opportunities and earnings prospects (see Indicator A4). However, despite the earnings advantage from completing a master’s programme or a doctorate, tuition fees in public institutions for full-time national students in these programmes are similar to those for bachelor’s programmes in the majority of OECD countries (Table C5.1). The additional expenses that master’s and doctoral students face are limited to the additional years of education and the foregone earnings due to the delayed entry into the labour market. In most countries where tuition is free of charge at bachelor’s level, there are also no fees at master’s and doctoral levels. In other countries, similar tuition fees are charged on average across the different levels of tertiary education, as in Austria, Canada, the Flemish Community of Belgium, Italy, Japan, the Netherlands, Portugal and Switzerland (Table C5.1).
In contrast, tuition fees for master’s programmes in public institutions are about 30% higher than for bachelor’s programmes in Chile, France, Korea and the United States, while in Australia, the French Community of Belgium and Spain they are over 50% higher (Table C5.1). These higher fees may limit participation at this level, if they are not paired with financial support to students. In a few countries (e.g. Australia, Italy and Switzerland), public institutions charge lower fees for doctoral programmes than for bachelor’s and master’s programmes to promote enrolment in doctoral programmes and attract talent for research and innovation. In Australia, for example, the annual average tuition fees in public institutions for doctoral programmes are about 15 times lower than for bachelor’s programmes (less than USD 300 compared to about USD 5 000). In fact, very few national doctoral students are charged any fees in Australia (less than 5% of doctoral students in public institutions). However, public institutions in Chile, France, Korea, New Zealand and the United States charge higher tuition fees for doctoral programmes than for bachelor’s programmes (data for the United States refer to master’s and doctoral programmes combined) (Table C5.1).
Differentiation by type of institution
Some institutions may struggle to strike a balance between offering an affordable education and their need for financial resources, leading to different levels of tuition fees in different types of institutions (see Definitions section). Independent private institutions are often less affected by government regulation and less reliant on public funds than public institutions. In some cases, they are also more pressed by competition to provide the best possible services to students. As a result, they charge higher annual tuition fees than public institutions for bachelor's programmes in all OECD countries with available data (Table C5.1). In addition, countries may differentiate tuition fees by field of study in order to attract students to certain fields or to reflect differences in labour-market opportunities (see Box C5.1).
In most OECD countries and economies with available data, over 80% of all students in bachelor’s programmes enrol in public institutions. In only about one-fifth of OECD countries and economies are the majority of students enrolled in private institutions. The share exceeds 85% in England (United Kingdom), Israel and Latvia, where the majority of students at this level are enrolled in government-dependent private institutions (Table C5.1).
In over one-third of countries with available data, tuition fees for bachelor’s or equivalent programmes are at least twice as high in independent private institutions as in public institutions (Figure C5.2). In the United States, the average annual tuition fee charged by independent private institutions for national students at the bachelor’s or equivalent level is USD 29 500, more than three times the average annual tuition fee in public institutions (USD 8 800). In Japan and Korea, average annual tuition fees at this level are between USD 8 500 and USD 8 600 in independent private institutions, while they are closer to USD 5 000 in public institutions. Tuition fees are about four times higher in independent private institutions than in public institutions in Spain, about three times higher in Italy, and about twice as high in Israel and Switzerland. In the Slovak Republic, tuition fees for bachelor’s or equivalent programmes are around USD 2 100 in independent private institutions, while public institutions do not charge tuition fees. Similarly, in Norway, the annual average tuition fees for bachelor’s and master’s degrees combined are around USD 5 800 in independent private institutions, while there are no tuition fees in public institutions (Table C5.1).
In contrast, the difference in average annual tuition fees at the bachelor’s or equivalent level between public institutions and government-dependent private institutions is relatively small in most countries with available data. Neither type of institution charges fees in Finland, Slovenia and Sweden, and government-dependent private and public institutions charge very similar average tuition fees in Austria, Chile, the Flemish Community of Belgium and Israel (Table C5.1).
Box C5.1. Tuition fees by fields of study
OECD countries often differentiate tuition fees by field of study in order to attract students to fields that are less in demand and to account for differences in costs and labour-market opportunities. The latter is one of the main reasons for introducing differentiated fees, although in some countries differences in tuition fees between fields of study may result from differences in tuition fees and enrolment between institutions rather than differences within institutions.
The differences in fees charged by public institutions for different fields of study are limited for first-cycle degree programmes (bachelor’s and long first master’s degrees) in Germany and Spain, while Australia, Canada, Chile and Ireland have the largest range of tuition fees across fields of study. Australia has the greatest variation: public institutions charge over USD 9 000 per year on average for first-cycle tertiary programmes in the two broad fields of engineering, manufacturing and construction, and agriculture, forestry, fisheries and veterinary compared with just over USD 4 000 per year for programmes in the field of education (Figure C5.3).
The fees charged by public institutions for programmes in the field of education are among the lowest in four out of the seven countries with data available (Australia, Canada, Chile and Israel). Fields such as engineering, manufacturing and construction; agriculture, forestry, fisheries and veterinary; and health and welfare are among the most expensive, as some of them often have the highest market returns (Figure C5.3).
Differentiation for foreign students
Tuition fee policies generally cover all students studying in the country’s educational institutions, including foreign students (see Definitions section). However, tuition fees may be higher for foreign students, and differences in fees for national and foreign students can have an impact on the international flows of students (see Indicator B6), among other factors such as public support from their home countries (OECD, 2017[2]). An increasing number of OECD countries charge higher tuition fees to foreign students than to national ones.
National and foreign students are generally charged similar tuition fees in Chile, the Flemish Community of Belgium, France, Israel, Italy, Japan, Korea and Spain. This is also the case in Greece, Norway and the Slovak Republic, where tuition is free of charge for both national and foreign students. In the European Union (EU) and European Economic Area (EEA), countries charge the same tuition fees to nationals and students from other EU and EEA countries. In some countries, however, the difference in tuition fees for national and foreign students can be significant. For instance, in Australia, Canada, and the United States, public institutions charge on average over USD 13 500 more per year for foreign students than for national students at the bachelor’s level (Table C5.1). In the United States, national students who study outside their state also pay higher tuition fees than in-state students. In Austria, although the average tuition fees charged by public institutions to students who are not citizens of EU or EEA countries are twice as high as those for national students (for bachelor's, master's and doctoral programmes), these fees remain relatively moderate. In Sweden, tuition fees for non-EU bachelor’s students reach USD 14 900 per year, while tuition is free for national students and citizens of EU countries. In Finland, as of the academic year 2017/18, tuition fees were introduced for students who are not citizens of EU or EEA countries and who are enrolled in bachelor's or master's programmes taught in English (Table C5.1).
Higher tuition fees do not necessarily discourage foreign students from studying abroad, however. Tertiary education in countries with higher fees for foreign students can still be attractive because of the quality and prestige of their educational institutions or the expected labour-market opportunities in the country after graduation. For instance, in Australia, Austria and Canada, international or foreign students make up at least 12% of students enrolled at the bachelor’s level, compared to only 5% across OECD countries (see Indicator B6).
Public reforms to tuition fees and public financial support to students
Reforms related to the level of tuition fees and the availability of scholarships, grants and loans are intensely debated in national education policy. They are often discussed in tandem, as countries seek to improve or adjust how the public and private sectors (including students and their families) share the costs of tertiary education. Between the academic years 2007/08 and 2017/18, 12 out of 20 countries and economies with available information have undertaken tuition fee reforms. In eight of them, reforms to tuition fees were accompanied by changes in the level of public subsidies available to students (Table C5.2).
In over half of the countries with available data, tuition fees for bachelor’s degrees in public institutions have increased by at least 15% over the past decade, in real terms. This is the case for countries like Canada, Italy, Spain and the United States, where tuition fees in the academic year 2016/17 (2017/18 for Canada) were between 25% and 46% higher than in 2007/08. The largest increase was in England (United Kingdom), where tuition fees tripled in the same period. The only two countries that registered a decrease were Austria and Germany. In contrast, there was no change over this period among the countries charging no tuition fees in 2007/08 (Denmark, Finland, Greece, Norway, the Slovak Republic and Slovenia). In Australia, Chile, France and Ireland, tuition fees remained fairly stable and did not increase by more than 10% (Table C5.2).
OECD countries have different approaches to providing financial support to students enrolled in tertiary education. Regardless of the level of tuition fees, countries and economies can be categorised according to the level of public financial support available to tertiary students. In Australia, Denmark, New Zealand, Norway and Sweden, at least 80% of national students receive public financial support in the form of student loans, scholarships or grants, but no more than 20% of students do so in Austria, the French Community of Belgium, Portugal and Switzerland (Figure C5.4). In these countries, public financial support instead targets selected groups of students such as those from disadvantaged backgrounds or low-income families.
In recent years, OECD countries and economies have passed several reforms to improve access to tertiary education (Table C5.2). In Chile, Greece, Korea and Portugal, measures were implemented to expand access to tertiary education to students from disadvantaged backgrounds, while New Zealand increased public subsidies to make the first year of tertiary education free of tuition fees for new students or trainees. From the academic year 2016/17, Norway started a reform to gradually increase the State Educational Loan Fund’s financial support from ten to eleven months per year. In England (United Kingdom), the threshold for the repayment of income-contingent loans for graduates from short-cycle tertiary and bachelor's programmes was increased from the financial year 2018/19, and grants for living costs were replaced with larger loans for new eligible national students from the academic year 2016/17. It also introduced the postgraduate master's loan scheme in 2016 to improve access to master's programmes. In Australia, measures were taken to improve the sustainability of the subsidy system for public institutions’ students enrolled in bachelor’s programmes (Table C5.2).
In the last decade, the share of students receiving public financial support increased by at least 14 percentage points in Chile (from 17% in 2007/08 to 58% in 2017/18), Denmark (from 69% in 2007/08 to 83% in 2016/17) and Italy (from 17% in 2007/08 to 39% in 2017/18). This share remained stable in all other OECD countries and economies with available data (Figure C5.4).
Forms of public financial support to tertiary national students
A key question that many educational systems face is whether to primarily use loans or to use grants or scholarships to provide financial support for tertiary students. On the one hand, advocates of student loans argue that they allow a larger number of students to benefit from the available resources (OECD, 2014[3]). If funding spent on scholarships and grants was used to guarantee and subsidise loans, the same public resources could support a larger number of students, and overall access to higher education would increase. Loans also shift some of the cost of higher education onto those who benefit from it the most, individual students, reflecting the high private returns of completing tertiary education (see Indicator A5).
On the other hand, student loans are less effective than grants at encouraging low-income students to access tertiary education. Opponents of loans argue that high levels of student debt at graduation may have adverse effects for both students and governments if large numbers of students are unable to repay their loans (OECD, 2014[3]). A large share of indebted graduates could be a problem if their employment prospects are not sufficient to guarantee student loan repayments.
OECD governments support students’ living and education costs through different combinations of these two types of support – and these combinations vary even among countries with similar levels of tuition fees. Among countries with data available, the average amount of public or government-guaranteed private loans that students borrow each year ranges from USD 2 400 per student in Latvia to over USD 10 000 in England (United Kingdom) and Norway (where tuition is free of charge and loans finance students’ living costs). Scholarships or grants received by students range from less than USD 1 000 per year in Estonia and the Slovak Republic to over USD 7 000 in Australia, Austria, Denmark, Switzerland and the United States (Figure C5.5). Among countries and economies with data on both forms of financial support, the total annual amounts received by students are highest in England (United Kingdom) (where the system is largely based on loans), and Norway and the United States (both Norway and the United States offer a combination of both loans and scholarships/grants). In Australia, Denmark, Switzerland and the United States, the average amount of grants or scholarships received by students is more than the average amount they borrow each year, but the proportion of beneficiaries of loans and grants/scholarships differs between countries – for example, in Switzerland only a minority of students receive public financial support (OECD, 2019[1]).
In all countries with data available, loans can be used for tuition fees, study materials and living costs, except in Chile where loans cover only tuition fees. Not all students are eligible to apply for student loans. The most common eligibility criteria for loans are a low-income background and the need to report progress in studies (the extent of this varies by country), together with citizenship or long-term residence and age (being at least 18 years old and below certain age thresholds that vary by country). Outstanding academic performance is a requirement in Chile, Japan and Korea, and study performance is one of the criteria required in Canada and Norway, while several OECD countries use means-tested financial assessments of students’ households to determine their eligibility for loans (Table C5.3).
In half of the OECD countries and economies with data available, public grants and scholarships are extended on the basis of both need and merit. Many countries prioritise public financial support for socio-economically disadvantaged students: grants are referred to as needs-based if they take into account various socio-economic criteria (most frequently family income). On the other hand, merit-based grants refer to grants awarded to the best-performing students, based on higher education performance, on secondary school results or on admission tests scores. In the Flemish and French Communities of Belgium, the Netherlands, Norway, and Switzerland, public grants and scholarships are needs-based only, while in Latvia they are only awarded on the basis of students’ academic merit (Table C5.3). In France, merit-based grants were modified in 2015 and reserved for students who graduated from upper secondary education with a very good grade and who meet scholarships’ socio-economic criteria for three years. As with loans, low income, disability, full-time enrolment and academic progress are among the most common eligibility criteria for grants and scholarships. In Denmark, all full-time students are entitled to a number of monthly grants and the maximum number of grants changes from one course to another. In Norway, financial support is initially extended as a loan and, if students progress through their studies and do not live with their parents (among other requirements), up to 40% of the amount may be converted to a grant. In the French Community of Belgium, students’ residence is also taken into consideration for the allocation of grants (Table C5.3).
In addition to direct financial support to students in the form of public loans, guarantees on students’ private loans, grants and scholarships, countries may also decide to provide indirect subsidies to tertiary education by fully or partially waiving tuition fees charged by education institutions or by covering eventual additional charges applied to students. For this reason, in addition to measuring direct public financial support, it is important to analyse the level of tuition fees ultimately paid by students rather than those charged by tertiary educational institutions (see Box C5.2).
Box C5.2. Tuition fees paid by students
Tertiary education policies do not only depend on the overall amount of public financial resources but also on the allocation of public funding (see Indicator C4). Some countries have decided to regulate tuition fees or not apply tuition fees at all, while others may give education institutions autonomy to set the level of tuition fees. This may lead to high tuition fees, which may be offset by direct financial support to students in the form of public loans, guarantees on student private loans, grants and scholarships. This type of financial support is directly extended to the beneficiaries, provided that they meet certain requirements.
Countries may also decide to provide indirect subsidies to tertiary education by fully or partially covering the tuition fees charged by education institutions. This is the case in Ireland, where the tuition fees charged by public institutions for bachelor’s programmes may exceed USD 8 700 but the majority of first-cycle tertiary students benefit from the Free Fees Scheme and pay only an annual student contribution charge of USD 3 800 (EUR 3 000) towards the cost of their programme of study (reference academic year 2017/18). Italy also reported that students pay slightly lower tuition fees than those charged by institutions, while in the French Community of Belgium students are offered other fee reductions and waivers based on their socio-economic status (Figure C5.6).
The fees actually paid by students are not necessarily always lower than those charged by institutions. In some countries (e.g. Chile), students face additional fees on top of tuition (Figure C5.6). Austria, Chile, Finland, Italy, the Slovak Republic and Slovenia reported additional charges, mostly related to administration, registration and student union membership.
Definitions
In this chapter, national students are defined as the citizens of a country who are studying within that country. Foreign students are those who are not citizens of the country in which the data are collected. While pragmatic and operational, this classification is inappropriate for capturing student mobility because of differing national policies regarding the naturalisation of immigrants. For countries that are members of the European Union (EU), citizens from other EU countries usually have to pay the same fees as national students. In these cases, foreign students refer to students who are citizens of countries outside the European Union. Further details on these definitions are available in Indicator B6.
Private institutions are those controlled and managed by a non-governmental organisation (e.g. a church, a trade union or a business enterprise, foreign or international agency), or their governing board consists mostly of members not selected by a public agency. Private institutions are considered government-dependent if they receive more than 50% of their core funding from government agencies or if their teaching personnel are paid by a government agency. Independent private institutions receive less than 50% of their core funding from government agencies and their teaching personnel are not paid by a government agency.
Methodology
Tuition fees and loan amounts in national currencies are converted into equivalent USD by dividing the national currency by the purchasing power parity (PPP) index for GDP. The amounts of tuition fees and associated proportions of students should be interpreted with caution, as they represent the weighted averages of the main tertiary programmes and may not cover all educational institutions.
Student loans include the full range of student loans extended or guaranteed by governments, in order to provide information on the level of support received by students. The gross amount of loans provides an appropriate measure of the financial aid to current participants in education. Interest payments and repayments of principal by borrowers should be taken into account when assessing the net cost of student loans to public and private lenders. In most countries, loan repayments do not flow to education authorities, and the money is not available to them to cover other expenditure on education.
OECD indicators take the full amount of scholarships/grants and loans (gross) into account when discussing financial aid to current students. Some OECD countries have difficulty quantifying the amount of loans to students. Therefore, data on student loans should also be treated with caution.
For more information please see the OECD Handbook for Internationally Comparative Education Statistics 2018 (OECD, 2018[4]) and Annex 3 for country-specific notes (https://doi.org/10.1787/69096873-en).
Source
Data refer to the academic year 2017/18 and are based on a special survey administered by the OECD in 2019 (for details see Annex 3 at https://doi.org/10.1787/69096873-en).
References
[1] OECD (2019), Education at a Glance 2019: OECD Indicators, OECD Publishing, Paris, https://dx.doi.org/10.1787/f8d7880d-en.
[4] OECD (2018), OECD Handbook for Internationally Comparative Education Statistics: Concepts, Standards, Definitions and Classifications, OECD Publishing, Paris, https://dx.doi.org/10.1787/9789264304444-en.
[2] OECD (2017), “Tuition fee reforms and international mobility”, Education Indicators in Focus, No. 51, OECD Publishing, Paris, https://dx.doi.org/10.1787/2dbe470a-en.
[3] OECD (2014), Education at a Glance 2014: OECD Indicators, OECD Publishing, Paris, https://dx.doi.org/10.1787/eag-2014-en.
Indicator C5 Tables
Table C5.1 Annual average (or most common) tuition fees charged by tertiary institutions to national and foreign students (2017/18)
Table C5.2 Trends and reforms in tuition fees and public financial support to tertiary education (2007/08 to 2017/18)
Table C5.3 Public financial support to national students enrolled in tertiary programmes (2017/18)
WEB Table C5.4 Interest subsidies, repayment and remission of public loans to students in tertiary education (2017/18)
Cut-off date for the data: 19 July 2020. Any updates on data can be found on line at http://dx.doi.org/10.1787/eag-data-en.
StatLink: https://doi.org/10.1787/888934164845