Education is one of the most critical drivers for Malaysia’s transformation from a middle- to high-income nation due its impact on productivity and human capital development. It is also an engine of growth in its own right. The sector contributes approximately RM27 billion (USD7.6 billion) or 4% of GNI in 2009.
When scaling up, private pre-school and child care providers are challenged with maintaining quality across all centres. There are four potential expansion models: franchising, growing organically via a hub-and-spoke model, network programming and acquisition.
In parallel, MoE will encourage the private sector’s efforts by removing four major roadblocks faced by the private sector in entering the market or expanding. All enablers are expected to be in place by the first quarter of 2011, so that private companies can execute as rapidly as possible.
To begin, we will explore the possibility of expanding the voucher scheme for ECCE services to all low-income families (i.e. the bottom 40% of the national household income distribution). By allocating funds to students rather than to institutions, families will be able to choose the provider that best meets their needs, thereby generating competition and a higher quality of service. The amount of funds given to families will be on a sliding scale basis, pegged to household income, with more support going to those who need it most.
MoE and the Social Welfare Department will streamline the licensing and registration process. This will be done in collaboration with local authorities, i.e. town planning divisions, health departments and fire departments. The end goal is to enable the end-to-end licensing approvals of these three agencies to be secured within one month. This will be done by harmonising procedures across all agencies throughout the country and streamlining the vetting process.
For example, we will secure agreement of local authorities to use the same application form nationally and require private providers to secure approval of the local authority’s town planning division prior to actual site acquisition.
We will also engage the Ministry of Finance (MoF) and Economic Planning Unit (EPU) to secure the designation of education as a priority sector eligible for preferential loans from Government institutions such as SME Bank.
We will establish an independent council or industry association for quality control and advocacy. Comprising members of the ECCE industry, this council will be responsible for setting standards, improving the quality of the industry and representing its interests to the public and to national or Government agencies (e.g. National Committee on Pre-schools).
New developments:
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Ministry of Education
The Ministry of Education, in conjunction with SEGI College, DiKA College, Taj International College, Institut Teknologi Info-Sains Mahir, MCS College, Institut Perkembangan Awal Kanak-Kanak, Kolej Uniti, Thames Technology, Iras Mewah and Institut Megatech have conducted pre-school teacher training in 10 states. Investment: RM11.434 million (USD3.3 million). |
The private sector is expected to take the initiative in developing high quality teacher training centres that provide pre-service and in-service ECCE courses recognised by the Malaysian Qualifications Agency (MQA).
The MoE will negotiate off-take agreements with qualified private teacher training centres. Likely assessment criteria will include investment in the research and development of innovative teaching and learning practices that can be commercialised via the production of teaching materials. For instance, the centres could specialise in cross-cultural teaching, as befitting Malaysia’s multi-cultural and multi-lingual diversity.
MoE will also fast-track the policy recommendation that training programmes can be taught in other languages such as English, Mandarin and Tamil. Our intention is to have these enablers in place by Q1 2011.
To meet this demand, MoE will encourage local providers by removing the barriers to expansion of international schools. Should domestic providers not be able to meet demand, we will also identify prestigious foreign school providers and encourage them to set up locally.
We have already identified 10 providers that are willing to commit to an expansion programme starting from 2011. MoE will set up a team responsible for tracking the progress of expansion and running marketing campaigns to engage new local and international providers.
We will provide international school operators with support on the issue of land acquisition and soft loans. Finally, we will work in collaboration with the Ministry of Higher Education (MoHE), the Ministry of Human Resources (MoHR), the Ministry of Tourism (MoTour), Malaysia External Trade Development Corporation (MATRADE) and Wisma Putra on marketing Malaysia as a destination of choice for private basic education.
We will allow private providers to offer pre-service and in-service training for primary and secondary school teachers. Private providers will be responsible for determining the subject areas they wish to specialise in (e.g. English or special education), as well as what business model they will use (e.g. face-to-face, e-learning, or blended models). They must, however, comply with the quality standards set by MoE and MQA for teacher training and must source their own capital investment and staff.
MoE will open hiring of public sector teachers to graduates of these institutions, regardless of whether they were sponsored by the Government. As with the ECCE training centres, we will also negotiate off-take agreements based on a compelling, value-for-money proposal for training of our teachers. These providers will be selected via a request for proposal process, the first of which will be launched by the end of 2010.
Private skill training institutions are well-placed to respond to these challenges as they tend to have closer ties to industry, are able to adapt more quickly to changing market demands and have excess capacity.
The Department of Skills Development (Jabatan Pembangunan Kemahiran or JPK) under the MoHR will work with MoE and the MoHE to support this expansion through a set of initiatives targeting employers.
JPK will accelerate the appointment of industry-lead bodies (ILBs) for each sector, beginning with the NKEA strategic sectors. ILBs will be the designated link between industry members, JPK and the private skills training sector.
Their main function is to ensure the relevance of national standards to industry needs and identify gaps in supply and demand of human capital. In addition, they will promote skill training amongst members and perform research on future needs of the industry. It is envisioned that existing associations representing a majority of their industry will be appointed as ILBs. The concept has already received endorsement from 22 potential candidates, and it is envisioned that 4 ILBs will be appointed this year, with a further 16 to be appointed in 2011.
We will expand JPK’s role as the single accreditation agency for all skills training programmes to harmonise the fragmented skills training landscape. JPK will work with the various ministries, industry sectors and private skills training providers to set a national professional standard by December 2011.
To further assist in this, we will establish a Board of Technologists to monitor and regulate professional conduct of technologists. Its mandate will be similar to that of the Board of Engineers, and it will report into the Ministry of Works. Progress towards full recognition of the importance of skills training has already been demonstrated, with the Public Service Department recognising the Malaysian Skills Certificate, Malaysian Skills Diploma, and Malaysian Skills Advanced Diploma for civil servants.
We will increase the funding for PTPK from RM100 million in 2010 (USD28.6 million) to RM500 million (USD143 million) for pre-service students, which will benefit 60,000 to 70,000 students per annum. While this is an increase in cost, this sum is still significantly lower than the amount disbursed by the National Higher Education Fund Corporation (Perbadanan Tabung Pengajian Tinggi Nasional or PTPTN), which is the primary source of tertiary education funding. It disburses RM3 billion (USD857 million) annually, which supports 200,000 students.
We will also move towards a performance-based approach for disbursement of PTPK funds, where institutes rated highly for employability of their graduates will receive more funds for students. It is envisioned that tracer studies will be implemented to monitor this key performance indicator.
We will also launch a national awareness campaign in 2011 to engender a shift in public mindset. Promotions of initiatives will be unified under the brand SkillsMalaysia and will begin with a national media campaign in 2011. The key messages will emphasise tangible benefits for students, e.g. high salary multiple, high probability of employment and the possibility of furthering their studies in advanced courses as well as highlighting priority sectors with a shortage of skilled labour. Messages from the media campaign will be reinforced by school counsellors, who will provide comprehensive career guidance to students.
Other initiatives to encourage the private provision of skills training include marketing vocational training to international students (see EPP 12) and collaborating with MoE in a public-private partnership, whereby vocational courses in secondary schools (during Forms 4 and 5) will have their practical component at the private skills training institute. To enable the latter, statutory revision of the Education Act may be necessary to regulate the interaction with industry.
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Ministry of Education
As part of this EPP, Skills Malaysia Year 2011 aims to raise awareness of and showcase the opportunities for post-SPM education and upgrades for unskilled workers available in Malaysia as an alternative to mainstream education. |
MoHE will facilitate a discussion between the three existing online universities to determine which institution or network of institutions will act as the gateway for all Malaysian universities that want to market their content online.
This gateway university will concentrate on developing e-learning expertise and work closely with other universities to transform their total content into distance learning material, supported by revenue-sharing agreements. The gateway university will also be responsible for building partnerships with local universities in target countries to push offerings into foreign markets.
This separation of the delivery and content development functions will allow the gateway university to ramp up quickly and cost-effectively. To guard against the attempted expansion of international competitors into Asia, we intend to offer content in local languages as well (e.g. Mandarin and Bahasa Indonesia).
This push to expand our distance learning presence will occur in two waves. The first wave will target China and India due to their size, as well as Indonesia, Vietnam and Thailand due to their cultural fit. Central Asian, African and Middle Eastern countries will be targeted in the second stage.
We will support the efforts to expand online distance learning by contracting additional government-to-government agreements and ensuring that countries comply with existing agreements. We will also review existing regulations that hamper the expansion of online distance learning and help facilitate cross-Ministry discussions as well as improve the set of incentives for local universities, particularly public tertiary institutions (Institusi Pengajian Tinggi Awam or IPTAs), to have their content digitised and rolled out online.
New developments:
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Asia e-University
Asia e-University is selected by the Ministry of Higher Education as the Gateway University for international education for distance and online learning. |
The Association of Chartered Islamic Finance Professionals (ACIFP), will take the lead in developing a harmonised undergraduate and post-graduate curriculum that is endorsed by the International Shari’ah Research Academy for Islamic Finance. Both of these organisations are under the purview of Bank Negara Malaysia (BNM).
This curriculum will build off existing ACIFP modules and other successful curricula run by partner institutions such as the International Centre for Education in Islamic Finance, the International Institute of Islamic Business and Finance, the International Islamic University Malaysia and the Islamic Science University of Malaysia. It will become the national standard for the industry and consist of a comprehensive education in Islamic and Syariah principles, followed by a specialisation in Islamic finance, business or law.
Once the standardisation and innovation of the curriculum is complete, ACIFP and its partner institutions will launch a marketing campaign to build international recognition among potential students. ACIFP will also bring in foreign institutions as partners, and leverage the Central Bank’s strong international network to build global acceptance among leading financial institutions. Both initiatives will target the Middle East.
The cluster is to be driven by anchor institutions from the education sector and allied health industry.
During the first phase, these anchor institutions will be responsible for building partnerships with smaller training colleges and developing a portfolio of joint programme offerings from diplomas to postgraduate degrees. This sharing of basic curricula will free up space for member institutions to pursue specialities in niche areas, thereby enhancing the overall portfolio of the cluster. We expect the cluster to provide programmes in all health sciences education. As part of this process, the cluster will engage industry players (e.g. hospitals and clinics) to develop an industry-recognised quality standard.
The anchor institutions are also responsible for setting up joint investment vehicles that will pool private investments to develop critical infrastructure like clinical labs and teaching hospitals. An integrated teacher training process, shouldered by all cluster participants, will also help to address the shortage of lecturers.
During the second phase, from 2012 to the end of 2013, the cluster will be broadened to welcome any institute that meets the quality standard. This may well include international partners from educational institutions to health service providers.
The Ministry of Health and MoHE will support the growth of the cluster through a number of incentives. We will facilitate the export of health care professionals through government-to-government agreements that guarantee the acceptance of Malaysian diplomas and degrees in other countries. Where reasonable and relevant, we will allow the increased usage of human-patient-simulators as a partial (20%) substitute for clinical postings. We will also restructure the approval process for student quotas so that institutions with good track records can be approved for increases in student numbers based on planned capital expenditure instead of finished infrastructure. This will increase utilisation and planning security for private investors.
As scientific collaboration requires sufficient facilities and benefits enormously from the close interaction of researchers, industry and investors, we recommend that this cluster be physically co-located with industry.
The ideal anchor institution is thus a science or technology park that draws researchers and industry from multiple growth sectors, possessing the necessary cutting-edge equipment and laboratories and providing professional commercialisation support.
In the business model, universities would commit research projects to be fully or partly located at the host, and have their professors serve as experts in the host network (e.g. hold periodic, specialised knowledge seminars). The host would provide free basic support functions (e.g. funding mapping, business plan support) and facilities (office space, wireless communications network, libraries and databases), while advanced offerings and facilities (e.g. grant proposal support or tailored laboratories) would be accessible at a discounted rate. Additionally, participating universities would get access to the host's network of start-up and mature companies, experts and other researchers.
We anticipate that the process of starting up this cluster and signing the relevant memoranda of understanding to be completed by the end of 2010.
New developments:
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Technology Park Malaysia: Advanced Engineering, Sciences and Innovation Cluster
Technology Park Malaysia (TPM) along with Universiti Tenaga (UNITEN) and Malaysia Multimedia University (MMU) aims to create of a network of collaboration among the private sector focused on research to transform advanced engineering and IT education sectors, serving as an enabler for high-growth sectors and to drive innovation. Investment (in total cluster over 10 years): RM374 million (USD107 million). |
Each cluster will link one or more universities or university colleges with neighbouring skill training institutions to deliver an integrated set of curricula, from skill training diplomas to academic degrees that build on one another to outline a clear career ladder.
Small providers will be instrumental in channelling their students to practical classes held at the college for a fee, or through a voucher system, payable by the student at the end of the session. Pure skill training facilities would gain reputation and quality, while university colleges would get access to a network of feeder institutions, producing a win-win situation.
MoTour will support this initiative by providing clusters with access to underutilised facilities (e.g. conference centres and hotels) so as to minimise the need for upfront capital investment. Private hospitality and tourism companies may also wish to play this role.
Investments to date:
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UCSI University: Hospitality and Tourism Discipline Cluster
TheUCSI University is playing the leading role to drive the initiative of Education NKEA EPP 10. The project is to produce skilled and qualified human resources to meet the demand of our country’s second highest export earning industry - with an ambitious growth of 3 times from the existing in the next 10 years. Investment: RM650 million (USD186 million). |
Educity Iskandar in Nusajaya is making good progress. Newcastle University Medical Malaysia (NuMeD) commenced operation in September and was officially opened on 1 November 2011. Netherlands Maritime Institute of Technology (NMIT) commenced operations in its temporary campus in May 2011, the construction of Marlborough College is 40% completed and Raffles University Iskandar and University of Southampton Malaysian Campus are on track to commence operations in January and September 2012 respectively.
New additions include Reading University Iskandar, which will start operations in 2012 and the Raffles American School, a co-educational residential international school with American curriculum which will open in September 2012.
Investment: RM581.8 million (USD166 million)
Positioning Malaysia as a regional hub of choice in the global education network will require actions that address each phase of the recruitment of foreign students.
To begin, the Malaysian education brand requires greater international awareness and national cohesion. While all three core Ministries (MoHE, MoE and MoHR) aim to bring in foreign students, MoHE (as the Ministry with the largest number of foreign students, and the focus of this EPP), will take the lead in developing and championing a consistent brand. We will engage with MoTour, MATRADE, Malaysia Investment Development Authority (MIDA) and Wisma Putra to explore ways of sharing international offices. This is to ensure that we can rapidly increase the number of Malaysian Education Promotion Centres (MEPC) from 4 offices today to 10 by the beginning of 2012.
MoHE will move from an ad hoc marketing campaign across 50 different countries to one that targets 10 countries with high potential. These 10 top countries were selected based on historical and projected outbound student numbers, government-to-government relationships and demand and supply matching (i.e. they have a shortage of graduates in a discipline we have excess capacity for). To improve cost effectiveness, we will work with MoTour to explore the bulk purchase of advertising space in shared target countries.
MoHE will also facilitate the set-up of a tertiary institution (IPT)-driven marketing and placement body, to complement the efforts of the Malaysian Education Promotion Centres. MQA will streamline the various foundation programmes on offer to create two common Malaysian Foundation Programmes — one for science and another for arts. These will be the single local foundation programme accepted by all local higher education institutions for degree programmes.
We anticipate that it will take three years to develop and pilot the Malaysian Foundation Programme, following which we can export it to support the branding of the Malaysian curriculum.
A comparison of fees at competitor hubs suggests that we can increase our fees for international students by up to 100% and still be competitive, due in large part to our low living costs. MoHE will thus encourage all institutions, public and private, to differentiate their fees for local and international students by up to 50%. MoHE will also ensure that all IPTAs first charge market level fees for foreign students, so as to create a level playing field with IPTSs.
Finally, we will need to address various immigration challenges that have been raised by foreign students, from the slow application process for a student pass, to their ability to work during term time and on completion of post-graduate studies.
We have developed a PPP model wherein the public sector provides the investment for building new schools, while the private sector operates them on a private school licence. MoE will secure a certain number of seats for students from low-income families from the surrounding catchment area. For these students, MoE will pay no more than the average per student cost of a public school. The private sector will not be allowed to charge these students any top-up fee. The private school provider will be responsible for recruiting the remaining students and may set their own fee levels for these students.
To get the programme up and running quickly, new public schools in the pipeline will be put up for bid as PPP schools. We aim to have at least 10 schools set up in 2011. MoE will evaluate private school providers based on criteria such as their historical track record on financial management and student outcomes, commitment to national development and required facilities.
There are additional business opportunities that will support the growth of the industry. These business opportunities include projects already planned and baseline growth in areas beyond the four education segments highlighted above. Overall, these business opportunities as well as the baseline growth of the sector is estimated to contribute a further RM14.3 billion (USD4.1 billion) of GNI in 2020 and generate over 252,000 incremental jobs.