Former FijiFirst Minister Dr Mahendra Reddy and the Vice Chancellor of the University of Fiji Professor Shaista Shameem
The University of Fiji says USP’s Dr Mahendra Reddy’s remarks on tertiary education funding shows ignorance of the role of universities in nation-building.
This comes as Senior Fellow at USP’s Graduate School of Business and former FijiFirst Minister Dr Mahendra Reddy in an opinion article in a newspaper has said that Fiji’s current tertiary education financing model, where government provides operational grants to institutions, capital grants to state-owned universities, and tuition scholarships to students across both public and private providers, has created a set of incentives that risk double subsidisation, surplus leakage, inefficient use of public infrastructure, and weakened accountability for public funds.
The Vice Chancellor of the University of Fiji Professor Shaista Shameem has questioned the comments made by Dr Reddy and has asked the USP’s Interim Administration to clarify whether these remarks are the USP’s official position on tertiary education funding in Fiji.
Professor Shameem says that it was astonishing that an academic was touting a flawed business model for funding tertiary institutions as some kind of mantra of progress.
She says such misplaced analysis of how funding to universities was to be allocated was a thing of the past, with tertiary education now seen as a public good or for developing a knowledge-based society.
Professor Shameem says instead, Dr Reddy was slavishly applying 20th century economic models that were not only outdated but dead in the water.
She says even Keynes would not recognize such analysis applying to tertiary institutions, let alone Adam Smith the father of economic theory in capitalism.
Professor Shameem questioned whether what Dr Reddy said was the official USP position because, if so, universities that upheld the human values foundation of education, such as the University of Fiji, would have a few choice words to say in reproof.
She says the comments also showed a complete misunderstanding of how operational grants awarded to tertiary institutions were used; not to subsidize tuition costs or as a windfall, but to pay annual salaries of staff and essential institutional operating costs that are not fully recoverable through tuition fees which is paid over the length of time of a study programme.
Professor Shameem has stressed that tuition fees and operational grants fund different cost components.
She says notably, some universities receive significantly higher operational funding such as USP and FNU so it may not matter to them, but the shortfall impairs UniFiji.
The Vice Chancellor says compared to the others, the UniFiji has received only modest operational support, and no capital funding except for the first time in 2025, despite over 20 years of existence.
She says they have made this last with great difficulty.
Professor Shameem says the University’s accounts are independently audited so there is annual scrutiny of public funds use.
She says the limited government funding for UniFiji was a kind of prejudice which was exacerbated by the comments made by Dr Reddy.
Professor Shameem says moreover, university funding was public good funding and could not be seen in conventional ‘margin’ terms but as adding value to the social growth of Fijian society.
She says UniFiji absorbed unmet demand that other universities could not fully accommodate, reducing pressure on public capacity rather than duplicating it.
She says instead of generalizations, UniFiji recommends a deeper analysis from a policy perspective to understand how different types of institutions contribute to national development and nation-building in a broad sense rather than from a market forces perspective.
Professor Shameem adds in any event, that for an academic of a university to criticize other tertiary institutions’ funding framework was not only unheard of and uncollegial but also comedic given the spectacle that USP has been in its immediate past.
Meanwhile Dr Reddy, in his opinion article, says if these issues are not addressed promptly, Fiji risks spending large and growing sums of public money while its own universities remain underutilised and public funds quietly accumulate private assets.
Dr Reddy questions if government is already paying a student’s tuition, what exactly is the operational grant paying for as from a public finance perspective, tuition paid by the State is already operating revenue.
He says when private providers receive both full tuition subsidies and operational grants, the grant risks becoming pure margin where that surplus is unregulated and discretionary.
Dr Reddy also highlighted that Public operating funds can end up being converted into private buildings and land, over which the State retains no ownership, equity or enforceable public-interest claim.
He says another inefficiency occurs when government-funded students enrol in private institutions for programs already offered by public universities with unused capacity.
He called for clearer funding rules, tighter controls on how operational grants are used and greater transparency around costs, utilisation rates and outcomes.
Questions have been sent to the University of the South Pacifiic.
