Good and bad aid: The rise and fall of two South Pacific universities

Introduction
Since the early 1990s at least, it has been commonplace to assess the consequences of international multilateral and bilateral aid in such terms as meeting `good’ governance criteria, providing for accountability, transparency and openness (Larmour 1998, pp. 1-20). Subsequently criteria including effectiveness have been utilised (Commonwealth of Australia 2011). As well, against the attacks from a vocal and influential anti-aid lobby, aid has been evaluated favourably in terms of whether it "really works" (Riddell 2014). The sub-text of all assessments, while rarely if ever stated, is whether aid advances capitalism, the accumulation of capital in the hands of a particular class, and meets particular welfare criteria.

Once the underlying purpose of aid, whether in meeting the political-security, law and order conditions for accumulation or making productive that which has become unproductive or under-productive, is acknowledged it becomes possible to differentiate between good and bad aid. Because labour is the starting point of capital, the premise of and prerequisite for accumulation, good aid advances accumulation. In the case of education good aid facilitates training of a labour force which meets present and future, domestic and international markets. Bad aid, however effective it may be in meeting other objectives, including slowing population movement to urban areas and trapping people in rural soaks of unemployed and underemployed does little to extend and enlarge the process of accumulation. Bad aid, as shown here, thus may even act as a barrier to the advance of capitalist production, that is may be against development (Cowen and Shenton 1996; MacWilliam 2013). Bad aid may also do nothing for the welfare of a country’s population, particularly in the case of PNG when combined with other damaging policies it does little more than trap those educated, at whatever standard, in rural areas where unemployment and impoverishment levels are unlikely to decline. The lack of entertainment and other facilities, as well as of personal security does not make most PNG rural areas attractive for tertiary educated people either.

The establishment and subsequent operations of the two most important universities in the South Pacific, the regional University of the South Pacific (USP) and the national University of Papua New Guinea (UPNG), provide the basis for a comparative account of both good and bad aid. As will be shown, since both universities were founded at the end of colonial rule in the region, they have followed different trajectories. Over the next forty years, USP has become well established, to the extent that its current Vice-Chancellor Professor Rajesh Chandra can set an objective for the University of increasing the proportion of people in the region who attend and obtain a tertiary education.

By comparison, UPNG has declined as a tertiary institution to the point where it is in a near-terminal state. In important respects, UPNG has followed the path described in the late 1990s by Australian National University (ANU) academic Ron May for the country as a whole, as passing from "promise to crisis" (May 1998). However since May wrote, as Papua New Guinea’s (PNG’s) economy has grown largely as an effect of a resources boom, UPNG’s crisis has deepened.

Most official assessments of aid invariably deal only with the monetary amounts involved and rarely include advice in the form of official and unofficial recommendations by multilateral agencies and national governments. Accordingly the continuous flow of reports from organisations, including the World Bank as "knowledge bank", which are intended to influence policies adopted by countries do not appear in summaries of total aid (cf. Riddell 2014, 1, fn.1). This paper does not follow the standard practice: consequently the 2010 PNG Universities Review Report, better known as the Garnaut-Namaliu Report commissioned jointly by the Papua New Guinea and Australian governments rates as part of the latter country’s aid to its former colony. Similarly the presence of donor country representatives on the USP Council, advising upon and supervising the direction of the institution is viewed as part of foreign aid to the university. This enlargement of the understanding of aid is central to the Discussion Paper.
While domestic conditions in the member countries, including Fiji where there has been a series of political crises since the first 1987 coup, have adversely affected the University of the South Pacific, the continuing international support has considerably mitigated these adverse factors. This support has not only provided finance, when contributions from member countries has been less than anticipated, but has been extremely important for providing up-graded facilities. USP has continued international recruitment of staff, albeit sometimes with less success than the University’s management would prefer, with funds provided by donors assisting wage and salary supplementation. This University’s continued success as a tertiary institution with a broad international support has been important to the production of skilled and managerial labour power for member countries and wider labour markets, including in Australia and New Zealand. For the University of the South Pacific, international aid has been good in sustaining and extending this objective.

For reasons examined here, the international stance toward UPNG has differed fundamentally and contributed significantly to the decline of the university, and tertiary education more generally in the country. The domestic PNG political economy has been very important in reducing the levels of funding and other resources provided to UPNG at Independence. However unlike USP where international support has mitigated the deleterious effects of domestic crises in member countries, for UPNG multilateral and bilateral institutions have supported the priorities of national governments. When these priorities  have driven reductions in the financial support to education in general, tertiary education and UPNG in particular, the advice given by the World Bank, AusAID and other external institutions has only strengthened the directions taken by national governments.  
This unity of objective occurs because in political-ideological terms, the priorities of PNG governments as well as the policy stance favoured by international institutions continue to stem from a reactionary ruralism (described below). The position has primarily stressed the need for education at all levels that purportedly fits the bulk of the country’s citizens for continued rural village life. While this view of education’s principal role initially down-graded secondary and tertiary education, even now as these are receiving greater attention the focus is upon sustaining rural existence. As changes world-wide have shifted  populations from rural to urban areas, with some estimates suggesting that in the early twenty first century for the first time over half the human population lived in cities and towns, education planning in Papua New Guinea has been instrumental in keeping attention on the countryside.   

To fit the ideology of reactionary ruralism, since soon after Independence tertiary education which could provide the skills for urban manufacturing and service industries, as well as highly trained state employment, has been down-graded in importance. Two current indicators of this down-grading at what commenced life as the country’s national university are the limited internet access and an inadequate library with few books, current journals and computers. It is in this sense, of supporting and even stressing the need for policies which downplay the importance of tertiary education in a contemporary capitalist economy that aid is bad. Perversely, even when effective, this aid `delivered (the) results’ of assisting in the destruction of whatever early promise UPNG had (Rudd 2011 [www.foreignminister.gov.au/speeches/2011/kr_sp_11-706.html Accessed 28/04/2014]).

While a similar view which gave primacy to rural existence has driven aspects of government policy since Independence in a number of other South Pacific countries, it has not had the same damaging effects at USP as at UPNG. Although there are particular reasons why this is the case in each of the USP’s member countries, they cannot be pursued in sufficient detail in this paper. To cite one example by way of illustration, in the case of Fiji, Indo-Fijian educational ambitions and achievements ensured a greater focus upon tertiary education, and USP, from its establishment. This in turn forced the ethnic Fijian, itaukei, elite to regard success at university at critical, with the attendant emphasis upon scholarships with allocation skewed to favour ethnic Fijian students. While "keeping itaukei down on the farm" remained one dimension of colonial and post-Independence state policy, another central aspect was affirmative action for ethnic Fijians, which included strengthened support for scholarships to attend educational institutions, in this case USP (Ratuva 2013).
 
Beginnings-late colonial origins
Both universities were constructed at the end of the colonial era, one as a regional institution, the other as PNG’s premier tertiary institution. Each was intended to educate and train skilled and managerial labour, as well as produce the intellectual elite in countries where the bulk of the population lived in rural areas, occupying smallholdings. As the original history of UPNG notes:

Official opinion throughout the 1950s maintained that university education in Papua New Guinea was not yet justified because the quality of primary and secondary schooling was inadequately developed and unable to produce people of the necessary educational standard. By the early 1960s this opinion had shifted dramatically to open espousal of higher education as a priority task (University of Papua New Guinea 1986, p. 1).

USP, as a regional university with eleven original member South Pacific countries, now twelve, was established in 1968, two years after UPNG. (Consideration is now being given to extend membership, to include a further three countries, one of which is Papua New Guinea.) Both universities were initially funded directly by the relevant colonial and regional powers, UPNG by Australia and USP by the UK, New Zealand and Australia. While the basis for UPNG’s funding changed with PNG’s independence in 1975, USP has continued to receive substantial amounts of direct international aid, as outlined below.

Soon after its foundation, tensions which had underpinned discussions in the Australian government and responsible departments were transferred to PNG. During the 1950s, under the agrarian doctrine of development which had guided colonial policy for the colony (MacWilliam 2013, pp. 77-155), planning had emphasised the importance of primary education to develop the skills needed to raise agricultural productivity and improve living standards of rural villagers. In the late 1950s there had been a "massive expansion of the primary school system" with the increase in government schooling coming on top of the previously dominant mission schools (Smith, 1985, p. 53).

However by 1961, at the same time as the Australian administration had begun to change position on what was required for the colony’s educational institutions:

Papua New Guineans themselves, at local government council meetings, at gatherings to meet officials and in the Legislative Council, made it clear that they wanted an education which gave them access to the benefits of the modern world and not a rural or vernacular education to fit them merely for village life (UPNG 1986, p. 1].

The growing demand for tertiary education came from a generation in the process of displacing the earlier commercial and political indigenous elite. The former’s ambitions became more and more apparent as Independence approached. Increased Australian government funding, as well as the revenues generated by the massive Panguna mine on Bougainville enlarged the space in PNG’s political economy which the younger generation of indigenous leaders would fill.

A recent assessment of the outcomes which followed the establishment of two tertiary institutions, including UPNG, in the Australian colony has concluded that:

This quick and large investment in advanced education was remarkably successful. The early graduates of the universities became the leaders of public service departments and other public institutions within five years of the University of Papua New Guinea producing its first graduates. The first generation of graduates’ success in their demanding roles was critically important to democratic institutions taking root in Papua New Guinea, with an independent judiciary, and the institutions of a market economy and the beginnings of localisation of business ownership and senior echelons of business personnel. The students in that first generation played leading roles in dismantling the institutionalised racial discrimination that had been a feature of life in the territories of Papua and New Guinea (Garnaut & Namaliu 2010, p. 7).

Simultaneous with these changes, however, the movement of Papua New Guineans to towns for wage work and other employment began to raise concerns about unemployed living in slums on the edge of urban centres.

"(B)y the late 1960s employment for primary school leavers was no longer so readily available" even as secondary and tertiary educated indigenes initially filled public service and other white collar positions. Just a few years later, prior to Independence, "'(e)ducated unemployment' and the social problems of 'qualification escalation' began to be seen as a significant matter for concern in urban centres". (Smith, 1985, p.  61; Conroy, 1976). A tussle which continues commenced about the appropriateness of relatively expensive expenditure on tertiary education, and the perceived need among planners and academics to keep populations in rural areas, "down on the farm".

The extent of urban unemployment was further exacerbated by the official antipathy toward all forms of import substituting industrialisation, which still remains. Instead indigenes and their advisers, in official reports and policy documents, stressed the romantic and other attributes of village life. One such adviser, Ross Garnaut, who was also an opponent of any policies supporting import substitution, echoed the enchantment with rural existence when stating:

One important asset that Papua New Guinea possessed at the transition from colonial government was the survival of the village as a viable and attractive, or potentially attractive, social and economic unit in many rural areas. Very few Papua New Guineans had grown up entirely outside villages. The idea of life in the village, improved by better services and opportunities to earn incomes, was to relatively few Papua New Guineans the unacceptably inferior alternative to urban life that it was in many other countries (Garnaut, 1981, pp. 161-162).

At the same time as the seeds of future policy to restrain urban migration and promote rural areas to soak up the increasing relative surplus population were germinating, village life was also subject to unrest and growing unemployment.  Squatters were marching on to plantations, most prominently on the Gazelle Peninsula. So-called tribal fighting was extensive in the Highlands, driven primarily by land shortages with the most fertile land farmed by an older generation, leaving little available for subsequent generations (Government of Papua New Guinea, 1973; Wilson & Evans, 1975; Anderson, 1977).  Expatriate plantation owners, desperate to sell their holdings intact as going operations, were pressing the colonial administration to establish sources of funds to allow indigenous bourgeois and would-be bourgeois to purchase these properties.

While similar demographic and political-economic trends were appearing in other South Pacific countries as these became independent nation-states, USP continued as a producer of skilled and managerial workers, and national elites. The university also maintained sufficient accreditation standards so that many graduates could gain employment in Australia, New Zealand and other industrial countries, often providing remittances to their places of origin. In 1976, at what became a critical moment for UPNG’s future, USP was funded by student fees, member countries and also by the UK, New Zealand and Australian governments which maintained a supervisory presence on the university’s administration.

Post-Independence changes: Growth and decay
University of the South Pacific
USP has continued to receive substantial amounts of direct international aid. In 1979, when there were over 1700 full and part-time students, the UK and Australian governments provided approximately one half of that year’s income. By 1987, with New Zealand supplanting the UK as a direct source of income in the 1988 Report to Council, both proximate countries provided a total of nearly F$1 million for staffing purposes. Ten years later, the 1997 Report contained a statement from VC Esekia Solofa on a new building program made possible by funding from AusAID and the Japanese government.

A large multi-purpose teaching complex funded by AusAID and due for completion in 1998 will house three large lecture theatres with a total seating capacity of 800, tutorial rooms and computer laboratories. The government of Japan is funding the redevelopment of the lower (Laucala, Suva) campus to produce a world-class facility to support teaching and research in the marine services – new facilities which will more than double teaching and research space (USP Vice-Chancellor’s Report to Council, 1997).

At the end of the 1990s, with student numbers of more than 5000, overseas aid on top of the funds for special projects exceeded FJD three million. By 2000, even as aid from donor countries declined dramatically from the previous year, no less than seven countries had a direct financial stake in how USP operated. France, Canada and Taiwan were donor countries, on top of the earlier Australia, Japan, NZ and UK. As well multilateral agencies and private foundations had joined the list of donors. Even in one of USP’s worst years for international financing, aid funds totalled almost F$10 million.

In June 2012 the Asian Development Bank (ADB) and USP signed the first agreement for a US$19 million loan to assist the University upgrade its regional campuses and improve access to distance as well as e-learning. The agreement was a first for the ADB and USP, for the former in providing a highly concessional loan to a regional institution and for USP its initial development loan from the Bank.  By 2013 USP had almost 25,000 students enrolled with campuses of varying capacities in all member countries.

Consultancy, research and other funds acquired by staff have made possible the construction of an approximately FJD three million `business’ building for lectures, seminars and offices (Personal Communication, 2014).

The Japanese government recently provided a special grant of approximately F$40 million for the construction of an IT building, with offices, lecture rooms and computer facilities. USP’s budget meets the on-going operating costs of approximately F$2-3 million for this building and equipment (Personal Communication, 2014).  The main Laucala campus has WiFi connectivity for students and staff: on a recent visit, the large staff and student dining area was populated with students using notebooks and other electronic equipment to access international and domestic sites.  

Financial and other international support for USP will amount to F$56 million in 2014, and is expected to rise to F$80 million in 2018. (These figures do not include member country contributions of almost F$48 million each year of the Plan. Development assistance from countries and other donors including private foundations comprises just over 30 percent of total USP income for 2014, anticipated to rise to 37 percent by 2018 (USP, 2013-2018, p. 41).

Despite the already rapid growth, and with education of varying qualities especially at the regional centres and via the overly ambitious extension on-line mode, USP’s management has even grander plans. As the 2010-2012 Strategic Plan noted in the Vice-Chancellor’s Foreword:

The University of the South Pacific stands at perhaps the most crucial crossroads in its 41-year history. It faces the call for increased provision of higher education for a region in which the participation rate in higher education is about one quarter of what is deemed adequate to be competitive in an increasingly globalised society and at the same time is being asked to improve its quality, relevance and sustainability (USP, 2010-2012, p. 2).

Important for USP’s position as the premier university in the South Pacific are the continuing scrutiny of its operations by international donors, forms of external assessment of courses and subjects offered, and recruitment of staff trained at universities outside the region. While working conditions, including personal safety, reduced comparability of wages and salaries, and major increases in teaching loads continue to affect USP’s capacity to recruit internationally the decline has not been as dramatic as in most areas of UPNG. The international support, including from AusAID, remains especially critical for the provision of library, electronic equipment, teaching facilities and on-campus student accommodation. USP is also engaging in an international drive to attract scholars, in part by increasing the numbers of professorial and research appointments (USP, 2013-2018, pp. 32-33. Whatever unfavourable comparative assessments can be made of USP with universities in industrial countries, there is no doubt that when evaluated alongside UPNG, the latter is not in the same league as a producer of skilled and managerial labour power. This account now turns to the decay of UPNG from the heyday of the late 1970s and early 1980s, before providing an explanation for the University’s current condition.

University of Papua New Guinea
For a few years after Independence UPNG continued on an upward trajectory, producing skilled workers and members of the political-commercial elite. Facilities continued to be upgraded as administrative buildings, classrooms and student accommodation were completed at the main campus and at other centres, including Goroka Teachers College. The UPNG computer network was launched in 1983. The library holdings expanded rapidly, and an archives collection commenced: by the mid-1980s, the facility was exceptional and the capacity of cataloguers to keep up with new purchases often stretched.  External assessments of programs and courses continued to occur, and international recruitment as well as exchanges of staff with USP and other universities assisted to maintain the quality of teaching even as student numbers increased. The favourable exchange rate of the PNG kina by comparison with other currencies, including the Australian dollar, helped staff recruitment as well as equipment purchases. There were some signs that the UPNG budget was under stress, including in the lack of new buildings and extensions to what existed as required by the increased student numbers. Nevertheless the rapid decline which was to occur from the late 1980s and early 1990s was not foreseen.

By 2010, when the major Review of PNG Universities was conducted, UPNG was in a parlous state, which continues. Although regarded as the country’s main university with a Mission to be `the premier University of the Pacific making available quality education, research and services to Papua New Guinea and the Pacific’, these lofty ambitions are all that remains for the institution. Even the official website, on which the Mission statement appears, was last updated in March 2007 (UPNG website www.upng.ac.pg Accessed on 14/04/2014). More generally as the Review’s authors, Australian academic Garnaut and former UPNG academic as well as Prime Minister (Sir) Rabbie Namaliu concluded regarding the country’s universities:

Together the Papua New Guinea universities provide for a number of students that is small by any international standards relative to the national population and to the demand for professional and technical skills. There is a pressing problem of quantity, reinforced by the widespread and powerful demands by parents for more university places. Regrettably, we see an even more pressing problem with quality of the educational experience (Garnaut & Namaliu, 2010, p. 12].

Or, as the National Higher Education Plan III for 2010-2040 puts it in more grandiose terms: `Higher education’s enduring struggle to find its authenticity in the national development framework spans two decades.’ Thus according to national planners the `key to the success of NHEP III’ will be:

…an enterprising higher education sector and its agencies involved in a system of national innovation and entrepreneurial in character. Each agency and cost centres will be centres of excellence. Hence the key theme in the next and succeeding decades will be innovation through entrepreneurialism. (Government of Papua New Guinea, 2010(b), 2010, p. 12)

With the possible exception of a handful of teaching areas which receive external support, and were noted as exceptional by the PNG Universities Review, there is little enterprising, innovative or entrepreneurial possible for the remainder of UPNG. Not only are buildings in need of repair and maintenance, teaching areas are grossly inadequate, and the library is antiquated in its holdings. Many staff are under-qualified, teaching excessive loads with little provision for up-grading qualifications or carrying out original research.  There is negligible computer access and the internet is generally not functioning or at best extremely slow. Staff housing is either not available or inadequate, with little security and many residents having only filial connections with the university. There is nothing comparable to the electronic facilities available for students and staff at USP. AusAID has not had an aid project dedicated to computing or any other area of UPNG since the early 1990s, at least, which contrasts starkly with the support for USP noted above.  

On a more prosaic "classroom" level, that is the teaching strand – Political Science - with the largest number of students in one of UPNG’s most substantial schools, consider the evidence from the same period when the Garnaut–Namaliu Review was conducted. The Papua New Guinea Development Strategic Plan 2010-2030 stated that two years earlier, in 2008  the total capacity of all six universities was 10,365 enrolled students with 3,135 graduates (Government of Papua New Guinea 2010 (a), p. 60). As noted above, by 2013 USP which draws upon students from member countries whose populations amount to probably no more than one third of Papua New Guinea’s, enrolled about two and a half times the numbers studying at these six universities.

In 2008, the Political Science Strand of the School of Humanities and Social Sciences at UPNG had 11 courses with a total enrolment of 1,415 students. Not one course had fewer than 80 students. `(Fifty five) percent of the courses had between 80 and 100 students, 27 per cent of the courses had between 100 and 199 students, while 18 percent of the courses had over 200 students’ (UPNG 2010, p. 5) In 2008, this Strand graduated 83 students, approximately 6 percent of the numbers enrolled in the School’s courses or just over one third of the School’s total.  In turn the School graduated 242 students or nearly 8 percent of the country’s total.

Even worse, if that is possible, than these figures of class sizes and the disparity between enrolments and graduations are the details of the hard-worked, under-paid staff who taught the 1400 students. While the Strand Establishment consisted of one professor and 4 full-time lecturers, it had no professor, two full-time lecturers, two full-time senior tutors, one part-time lecturer, and two part-time tutors. None of the longer term staff, all Papua New Guineans, had a PhD or equivalent. The sole international assistance was a visiting lecturer provided through a short-term UPNG-Australian G8 universities scheme, part-funded by AusAID. A UPNG Political Science Strand in which not one staff member had a doctorate or equivalent degree, all of whom were employed at the lecturer, senior tutor and tutor levels, taught an average of over 100 students per course (UPNG, 2010).

Subsequent to 2010, the UPNG-G8 scheme has been terminated and while a professor has been employed the staffing position in Political Science has not otherwise improved.
At the same time, the peak state body responsible for national planning could set the goal of developing "the higher skills necessary for PNG prosperity with a world class tertiary education sector" (Government of Papua New Guinea, 2010 (a), p. 59). While aware of the already considerable and increasing pressure for tertiary education being generated throughout the country, the Universities Review’s authors sought to dampen expectations of any rapid expansion in university education, proposing only to:

Limit expansion of State-funded places at State universities to 3-4 per cent peryear for the next decade, just above the rate of population growth, while the quality base is being rebuilt. There can be faster return to growth if high quality standards are being met, and there can be supplementary growth from private universities [Garnaut & Namaliu 2010, p. 1].

From this brief summary of the current conditions of USP and UPNG, the most obvious question which arises is why, given some important similarities in the starting points for both institutions, has the massive disparity occurred? The final section of the paper provides a partial answer to the question, focusing particularly on the part that foreign aid, monetary and advisory, has played in the outcomes.

Good and bad aid: Internationalism and reactionary ruralism
The immediate Post-Independence political economy of Papua New Guinea
According to the Garnaut-Namaliu Report, "(i)n 2009, the inflation-adjusted public funding per student made available to the universities was about one fourteenth of the level in the early years of Independence".  While there had been more general substantial reductions in public expenditure which affected all of the core services provided by government’ the cuts "went much further with higher education than in other areas". For the economist and the former politician, now consultant advisers, this slashing "went too far" even if "(s)ome downward adjustment in the share of public resources going to the universities was warranted after the crash programs preceding Independence’ (Garnaut & Namaliu 2010, p. 8).

"Warranted" is of course an assessment and justification after the event and does not explain why the massive reduction occurred. To understand fully how UPNG has come to the current abysmal condition would require a more substantial examination than is possible here. Nevertheless some major factors can be identified, including the part which international advice to successive Papua New Guinea governments has contributed.

It was shown above how significant for USP’s development has been the continuing international financial and advisory aid, including from Australia. When Australian budget and program aid was so important for the initial establishment of UPNG, why this flow of funds ceased after Independence is the appropriate starting point for the explanation.
During the negotiations for the move to self-government and Independence, the process through which Australian aid was provided to PNG changed.  Previously "budget aggregates were handed down from Canberra and there was no mechanism in Port Moresby for integrating decisions on these aggregates into wider aspects of decision-making by governments". This support "held (the economy) together, and provided (the) main impetus to growth, by extraordinarily large injections of Australia aid which contributed directly 53 percent of public expenditure in 1971/72" (Garnaut 1981, p. 159). Following lengthy negotiations in Port Moresby and Canberra a post-Independence aid agreement was struck. "Australian aid was to be provided as untied cash grants, minimum amounts of aid were specified forward for five years" and terms written into the agreement which gave hope that "clear principles could be agreed upon for upward adjustment of aid levels above specified minima" (Garnaut, 1981, p. 178). However subsequently Australian aid would provide a decreasing proportion of the national budget as other international as well as domestic sources of revenue grew. That aid would also change, from untied budget support to project, program and other closely supervised forms of aid.

While the transfer of principal responsibility for aid expenditure decisions to the newly constructed institutions of PNG satisfied anti-colonial nationalist sentiments in both countries [Whitlam 1985: 71-101], outcomes now were more dependent upon the turns and twists in the domestic political economy. Initially the Minister for Finance, (Sir) Julius Chan – leader of the small but influential Peoples Progress Party – was able to support a `new policy of financial stringency’. Garnaut claims that, despite early opposition to the direction of government policy:

An atmosphere developed within which it was nationalist Papua New Guinean behaviour not to spend money. In most agencies of government – the Universities, the Minimum Wages Board, the Cabinet itself, even the Department of Foreign Affairs – there was acceptance among senior Papua New Guineans (after a period of crisis) of tight financial constraints. People who wanted to spend more money came to be watched more carefully, especially if they were white. This reduction in expectations was necessary to economic stability and to political stability, and can be counted as one of the major successes of the early years of national government in Papua New Guinea. (Garnaut,1981, pp. 178-179]  (1)

Garnaut’s account, constructed by an expatriate adviser involved in many of the institutional changes of this transition period, needs to be tempered by inserting a description of more important changes taking place in the national political economy. These changes gave rise to the immediate post-independence criticism of four senior bureaucrats, the so-called "gang of four" which included Namaliu that there was rising corruption in the country. As much as budgetary restraint was a feature of the transitional years, so too was the flood of money that washed through PNG.

The increases in domestic revenue  came from several directions, including the coffee price boom which resulted from the 1975 frosts in Brazil and production at the giant Panguna copper and gold mine on Bougainville. International coffee prices quadrupled just as a Papua New Guinean bourgeoisie and would-be bourgeois took over Highland plantations from their former expatriate owners. The takeover was assisted by the provision of loans from the PNG Development Bank and by the formation of Development Corporations in which villagers' claims for plantation land to be redistributed were dampened by the provision of shares in the joint stock firms which took over the largeholdings (MacWilliam, 1986, pp. 150-181. Port Moresby became a cockpit of competing indigenous commercial interests, when Highlanders flush with coffee money fought for ownership of shops, real estate and other businesses with their Papuan counterparts. Younger Tolai would-be bourgeois also shifted the focus of their activities to the new national capital when they were unable to extend their businesses on the Gazelle Peninsula. In the North Solomons Province a newly emergent Bougainville bourgeoisie took over the wet canteens frequented by the expanding labour force and began its march into other areas of the local political economy (Thompson & MacWilliam, 1992, pp. 85-119).

The indigenisation of the public administration which was largely completed in the years immediately after Independence played an important part in joining the politics and economics of accumulation. During most of the colonial period, public servants were barred from linking their state employment with private accumulation. As Independence approached these barriers became less enforceable, especially when expatriates entered into joint ventures with Papua New Guineans. After self-government the remaining walls tumbled down: straddling between state employment and ownership of commercial enterprises became commonplace. The formation of provincial governments increased the arenas in which business activity was coupled with holding public office.

The joining made more conspicuous how political leverage was exercised by state officials seeking to advance their accumulation. Criticism of what was regarded as corruption was constant. Holding government office and asserting parliamentary authority became all-important, as the rapid increase in the numbers of people contesting seats at national elections suggested.

By the mid-1980s, the indigenous takeover of many areas of commerce was completed. The moves included into nearly all the coffee plantations, most of the copra and cocoa plantations as well as associated activities in transportation and processing [MacWilliam 1993]. Initial attempts to expand into import substituting industries were nevertheless stymied by a combination of government opposition and academic advisers. Instead the indigenous bourgeoisie had begun to look overseas, a direction which accelerated substantially over the next twenty years. The commercial shift meant less and less concern for domestic development, which coincided with the international movement that emphasised reductions in state expenditure, lower tax regimes and privatization. The indigenous wealthy followed their late colonial predecessors but in a more extensive manner to send their children overseas for education, including at the tertiary level.

The revolt on Bougainville which escalated in 1988 and subsequently closed the Panguna mine forced a major reduction in government revenues and some areas of expenditure, including for education and health, but not for the PNG defence forces (May & Spriggs, 1990; Spriggs & Denoon.1992; Regan & Griffin, 2005). The full consequences of these drastic reductions, carried out in the name of balancing the budget and coming on top of the earlier "trimming", would become apparent over subsequent decades as the universities were unable to produce the skilled and managerial labour required when the economy expanded again in the early twenty first century. As had happened in the 1960s, growth required major imports of labour which in turn had severe consequences for PNG. As the Garnaut–Namaliu Report noted:

Recent analysis suggests that expenditure on foreign personnel alone amounts to over three quarters of a billion kina per annum, or about three and a half percent of GDP. This is unusual. The social as well as private rate of return on good, high-level education is extremely high, even if we calculate only the financial value of
replacement of imported personnel. The social rate of return on the skills and capacities necessary for good governance is higher still, by a wide margin. (Garnaut & Namaliu, p.11)

The 2010-2030 PNG Development Strategic Plan makes a similar point and directly relates the drain to the state of the country’s tertiary education institutions, claiming that: "Inadequate higher education has resulted in one third of skilled jobs being held by foreigners who drain K780 million out of PNG" [Government of Papua New Guinea, 2010, (a), p. 60)

So far the analysis appears to have ignored policy regarding the bulk of the country’s population: in PNG, more than 80 percent of the people live in the countryside, outside major urban centres, on smallholdings and in small villages. This existence is usually characterised as living subsistence lifestyles, a description which is unchanging even as commercialisation has extended to all areas and people. Again to cite the Universities Review: "There has been a vast expansion of monetised exchange of food among other things" (Garnaut & Namaliu, 2010, p. 7). Leaving aside for the moment how this mystification has occurred, of a commercialised existence in increasing forms of necessary consumption, including mobile phones, which is nevertheless considered as a subsistence lifestyle (MacWilliam, 2012; forthcoming), it is now necessary to bring "village life" into the analysis of post-Independence government policy for higher education. As will be shown, there remains a pronounced "rural bias" in education policy, which has international and domestic roots.

Reactionary ruralism
A central theme in post-war colonial education policy, as already noted, was the need to develop primary education which provided skills necessary to raise standards of living for the bulk of the population through increased smallholder agricultural production. During the 1950s small holdings and village life were secured in order to raise agricultural production and productivity as the precursor for an industrial, urban existence and independent country. As the relevant Australian Minister Paul Hasluck explained, a major purpose of colonial policy under an agrarian doctrine of development was to secure village life before the uncertainties and vicissitudes of urban existence, proletarian life, took over (Wright, 2002; MacWilliam, 2013).

Also noted above is how by the late 1950s and early 1960s there was international and domestic pressure to rapidly expand secondary and tertiary schooling. In turn, by the early 1970s there had started to be opposition to the focus on more expensive `elite’ education. Missing from consideration was that further improvements in primary education required more not fewer university graduates, an absence which became especially noticeable in the re-emphasis upon primary education of the 1980s and 1990s.

This re-emphasis was fuelled in part by the beginning of cuts to most forms of public expenditure and became part of the contest over declining relative shares. The post-Independence cuts to expenditure drastically affected not just university education, as noted above, but also primary and secondary education. Even as smallholder production became relatively more important and plantation production less so in key export crops, including coffee and cocoa, the critical developmental role of the late colonial state ceased to exist (MacWilliam, 2013). Stabilisation funds, initially intended to smooth out price fluctuations on international markets and maintain price incentives to keep smallholders increasing production became instead welfare payments. In the words of one agricultural adviser, payments from the funds to smallholders for marketed produce became "just like working for the dole" (MacWilliam, 1996).

As is shown below, it was at this critical point in PNG’s post-colonial development that international advice became crucial for the decline of UPNG.  As education planning became more emphatically opposed to tertiary education, the advice reinforced not just the drive to cut state expenditure in the name of balancing budgets but also pushing for wage cuts (Levantis, 2000). Critics, including the late Tim Curtin, attacked the downplaying of links between tertiary, secondary and primary education while also ignoring the possible budgetary benefits of tertiary educated and higher paid workers. Nevertheless their objections had little effect. Reactionary ruralism which had been present from the late 1960s became more politically influential, including in World Bank, AusAID and other international forms of advice.

This political-ideological theme, which emphasised the primacy of state policy directed at supporting rural existence, had three main drivers. Firstly, the conservative objections to the destruction of rural life which appeared in Europe at the start of the industrial revolution were given fresh impetus by the late 1960s and early 1970s appearance of unemployment and disorder, particularly in urban centres of Papua New Guinea. Academic defenders of urbanisation as a desirable trend were clearly in a minority (cf. Ward, M. 1970; Ward, R.G. 1970; Conroy 1974), and the appearance of slums with their attendant poverty disturbed indigenous politicians (Somare, 1975, p. 82]. Garnaut’s depiction of rural life as an "asset", cited above, was the predominant reactionary view at a moment of major economic and political change.

Secondly, and following from the first, the opposition to industrialisation and the development of manufacturing industries or "taking the first world route" gained strength. Import substituting industrialisation and even other forms of manufacturing, such as processing agricultural crops beyond preparing fruit for international transportation, were ruled out. Thirdly, the antipathy to urbanisation and industrialisation in turn led to an attempt to press the surplus population back upon the land, in the countryside, even as political power was being transferred to indigenes for whom rural accumulation held out limited, short-term prospects. The effects of reactionary ruralism on policy for tertiary education in general, and UPNG in particular, would become especially severe as the view gained primacy in international and domestic circles over the next three decades.
   
Even as UPNG was established and enlarged, the "primary education first and foremost" proponents had remained prominent domestically. In 1974, one year before Independence, a committee chaired by the then Director of Education AlkanTololo produced a report recommending a five year plan which would supposedly reverse the thrust of late colonial policy that included the construction of UPNG. In an intellectual climate influenced by a World Bank/UNDP report, popularly known as the Faber Report, and the domestic tussles which resulted in the Final Report of the Constitutional Planning Committee, the Tololo Report had little immediate effect. Nevertheless it indicated the direction which was then becoming popular, focusing upon community education, primary and secondary schooling and use of vernaculars.

From the mid-1980s, the return to the basics of primary education direction became more pronounced. Another Director of Education (Sir) Paulius Matane headed an inquiry which produced a report titled "A Philosophy of Education". Also heavily influenced by ideas which were important in framing the national constitution with its Goals and Principles prominent, this document made clear the rural, primary schooling bias which should underpin education policy. It also served as a focal point for attacks on the relative privilege of tertiary education.  Recommendation 8 proposed that: "Funds be redirected from Higher Education towards the goal of Universal Primary Education" (Government of Papua New Guinea 2002, p. 8). By implication, tertiary education was not an essential component of either primary or secondary education.

By the late 1980s, international advice increasingly supported this policy direction, as the reduction in state expenditure for all public education continued (World Bank, 1987; World Bank, 1988). In 1994, the Department of Education produced a National Plan of Action under the slogan "Education for All" to cover the period from 1994 to 2010. It was developed by a large group of domestic and international officials from the Department of Education, officers of 20 Provincial Education Boards and UNESCO’s Principal Regional Office, Asia Pacific. Funds for the Plan were provided by UNESCO and UNICEF. The Plan is introduced by the Minister’s "Forward (sic)" and neatly frames the principal direction of education planning. In the Executive Summary, part 4 "Development Programme" the underlying purpose of education for the most important education ministry is summarised in these terms

Education will enable students to apply skills and knowledge in their communities and take advantage of traditional work and opportunities for community-based employment. They will not have to move to urban environments in order to find work and will not be inclined to join youth gangs and become criminals because of lack of employment. (Government of Papua New Guinea, 1994 , p. xix).

Gangs and criminality were by implication an urban and not also a rural phenomenon. Three years later, the PNG Government endorsed the country’s first National Education Plan to cover the decade from 1995 to 2004. Constructed through the Department of Education under the 1995 theme of "Doing More with Less and Doing it Better" the Plan does not include university education, the responsibility of another department. However it notes the necessary connection with universities, pointing out that the "(s)upply of secondary teachers by the university sector is out of step with national need". The Plan draws upon National Objective 24 for its legitimacy, which states the need to "develop a schooling system to meet the needs of Papua New Guinea and its people which provides appropriately for the return of children to the community for formal employment and for continuation to further education or training". Community here is synonymous with village life and rural areas.

To ensure that the rural direction was not misunderstood, a later section headed "The Developmental Framework" extended the fear of urbanisation in more detail. While noting that the rate of growth of the urban population slowed between 1980 and 1990, nevertheless (p. 23):

The growth in urban population is creating some overcrowding, and causing an increase in urban crime, drug abuse, unemployment, housing and sanitary problems. Discontentment among the youth, and an upsurge in white collar crimes are major dysfunctions of Papua New Guinea’s urban societies - a scenario likely to continue and threaten future development (Government of PNG, 1998).

At a lower level of official determination, in 2002 the National Department of Education and AusAID produced a report titled "The State of Education in Papua New Guinea"(Government of Papua New Guinea, 2002). Constructed by the Education Reform Facilitating and Monitoring Unit, and with no reference to university education, this Unit again cites the NEC Objective 24 cited above with its rural pre-occupations. In none of these plans or reports does the need for a strong and growing university component of the education system appear. That UPNG was at the same time withering and falling into almost irreparable disrepair clearly had no place in either domestic or international concerns about education in the country. While USP focused on producing more and more graduates for domestic and international markets for skilled and managerial labour, UPNG indeed did less with less and became much, much worse.

That urban existence and manufacturing industry remains a low, even absent priority in the objectives of university education is clear also in the 2010 Garnaut-Namaliu Review.  While noting the role of tertiary education for a democratic polity and for governance, the Review focuses heavily on the priorities for primarily rural activities. It commences from a view of the future of the PNG economy which emphasises that:
 

The current Southern Highlands-Port Moresby investment is likely to be the tip of the iceberg, as work proceeds on other petroleum and metallic mining, and projects based on Papua New Guinea’s renewable energy, and the country’s vast potential for sustainable development of forestry, fisheries, agriculture and tourism. (Garnaut & Namaliu, 2010, p. 9)

While tertiary education is not providing the skills necessary for the mining industry, welfare services, including health and education, there is also an: "excess demand for all of the skills required by the expansion of the non-renewable resources sector (which) is more acute now than ever before, and will grow wider in the period ahead" [Garnaut & Namaliu 2010, p. 10])  Although the Review’s authors acknowledge that there is a need to meet the "immense backlog in investment in the range of high-level skills required for leadership of institutions in the public sector and civil society as well as business", the possibility that such people may only want to live in urban centres rather than rural areas with few services and widespread disorder does not appear to be of importance in rebuilding PNG’s public universities (Garnaut & Namaliu, 2010, p. 11).

As much as the Review constructs a need for university educated personnel, there is never any doubt that it is to the countryside where the bulk of the population lives that the principal attention is to be paid. This attention is not simply for the provision of welfare services. As the Review emphasises:

There is an acute shortage of all of the types of expertise necessary to ensure that opportunities for expansion of the renewable resource industries, many of which have great potential for operation at village level, are not lost in the rush of scarce skills to the large non-renewable resource projects. [Garnaut & Namaliu 2010, p. 11) (2)

Manufacturing appears only once, and as a word in a list: there is no consideration given to the role of tertiary education in urbanisation and urban industrialisation. Instead the Review recommends that the Papua New Guinea Government through the Commission for Higher Education conducts a:

… feasibility study (on whether there should be: SM)) a good university based in the biological sciences and the social sciences related to rural development, and takes an early decision on whether to provide funds for such a university to achieve reasonable international standards...The feasibility study would define the amount of funding, in addition to the funding for universities recommended in this Review, that would be required to achieve the objective of establishing a good university underpinning rural and sustainable industry development in Papua New Guinea. (Garnaut &Namaliu, 2010, p. 45)

The rural bias which appears in the Review is also central to the National Higher Education Plan 2010-2040. Planning is for a Papua New Guinea which `remains an agrarian society with no surplus in producing and trading culture and does not operate in the competitive culture of the exchange economy’. The country has a "`(s)mall industrial capacity to create wealth to supplement human labour" [Government of Papua New Guinea, 2010 (b) Summary, p. 2]. Furthermore, there is no intention to change this direction: "Economic growth will emphasise biodiversity and rural development in alliance with industry and government" (Government of Papua New Guinea, 2010 (b) Summary, p. 7)

Conclusion:
As far as tertiary education policy for PNG is concerned, the international shift of humans to urban centres for employment in manufacturing and service industries is to be ignored. Paradoxically international aid institutions, in their continuing advice which might be expected to understand the implications of these important global changes, have instead supported this reactionary direction.

At the same time, USP has been provided with substantial international monetary and advisory aid to the point where its Vice-Chancellor can advocate an expanded role for the university in increasing the proportion of the population from member countries which enrols in universities, specifically that institution. USP is to have an even more important role in training skilled workers and others for employment within the region and for international markets.

As UPNG and other state tertiary institutions have declined in the quality of education provided, there have been attempts – including through international aid - to shift the focus to private universities, including Divine Word established in the late 1970s. However these remain small and there is no evidence that the academic standards are much, if at all, better than exist at UPNG.  Instead as pressure for tertiary education increases among the PNG population, more and more undergraduate and graduate ambitions are satisfied by parents sending their children overseas. Unsurprisingly, once educated in the major urban centres of industrial countries, university graduates are not rushing to return to PNG to live in either rural areas or poorly serviced, high crime rate towns and cities.

If the likelihood that tertiary trained people from PNG and other South Pacific countries will emigrate to other locations is increasingly similar, perhaps there is no case for substantial universities in the countries of the region at all. In a perverse manner, this is not entirely dissimilar to what was argued by expatriates in PNG when the establishment of UPNG was first mooted. "Why educate bush kanakas" was then, rightly, regarded as deeply racist as well as a barrier to the country’s development.  Is advocating policies to provide a limited amount of tertiary education to fit Papua New Guineans for a rural existence not also offensive and limiting, very bad aid?    

Notes:

1. Framework of Economic Policy Making, pp. 178-9.
2. PNG UNIVERSITIES REVIEW REPORT, p. 11.

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