Neoliberalism and Inequality in Higher Education

Dzuriyatun Toyibah

Universitas Islam Negeri Syarif Hidayatullah Jakarta, Indonesia

Keywords: Commodification, Internationalization, Audit Culture, and Inequality

Abstract: Neoliberalism has substantial impact on creating a market-oriented higher education system and as

consequence it requires greater accountability, quality, and efficiency. Neo-liberalism in higher education

has been implemented in some principles such as commodification, internationalization, and quality

assurance. The university shifts into providing services, research, and labour to the industrial sector of the

economy. Drawing from the existing literature, this paper discusses the consequences of neo-liberalism,

especially to maintain inequality within higher education systems observedin some countries, including in

Indonesia.There are two neoliberalism elements (commodification and quality assurance) that have been

regarded as rather commonplace within the Indonesian higher education system. Contrarily,

internationalisation, despite its mounting presence, is still scarcely discussed. The issue of inequality in

Indonesian higher education may be traced backed to the reality in which there is a dual system of religious

vs secular public higher education and the status of private vs public higher education institution. The three

neoliberalism principles above will create immense inequality between higher education institutions,

subsequently, students attending the top public secular higher education institution and private secular ones

will enjoy better quality of higher education facility than students attending public religious and private

secular or religious universities with lower accreditation rank.

1 INTRODUCTION

Liberalism, both classical and neo-liberal, assumes

that the economic character of being profit oriented

is the main character of human being. The difference

between classical liberalism and neoliberalism is a

shift from the concept of exchange to the concept of

competition requires market intervention (Read,

2009). In other words, neoliberalism applies

capitalism principles and it is characterised by the

use of state power to intervene in the market

(Brewis, 2018). This has significant impact on the

academic environment, especially because

universities must conform to the notion of rational

economy, accordingly, the work environment in

universities would be subject to external

competition.

This paper will discuss those three principles as

they have been practiced in a number of liberal

countries and how they have been adapted in

Indonesia’s higher education policy. Additionally,

this article discusses the issue of inequality in higher

education under the neo liberal policy, and it is

structured as follows. The first section focuses on

the introduction of the study and overview of

neoliberalism in higher education and social justice.

The next and final section discuss neo liberalism and

social justice in Indonesia and conclusion.

2 HIGHER EDUCATION AND

COMMODIFICATION

The first influence of neo-liberalism in universities

discussed in this paper is the commodification of

higher education. This term has been used to

describe the fact that higher education has become

an economic commodity. As a consequence of

higher education commodification, universities must

emphasize to implement the principles of efficiency,

accountability, income generation, and intensify job

training, in which students are seen as customers

with the goal of improving social capital and human

capital (Saunders, 2014). The principle of efficiency

in universities in western countries is manifested by

prioritizing the recruitment of non-permanent

academic staff, university decisions are made in a

hierarchical manner by reducing the influence of

1590

Toyibah, D.

Neoliberalism and Inequality in Higher Education.

DOI: 10.5220/0009932415901597

In Proceedings of the 1st International Conference on Recent Innovations (ICRI 2018), pages 1590-1597

ISBN: 978-989-758-458-9

faculty and students, and giving more priority to

science compared to the field of humanities and the

arts. Faculties must also possess an economic

function, wherein research can generate income,

education process and services can generate profit.

Academics are also positioned similarly as company

workers that must contribute productively to the

organisation.

Another consequence of higher education

commodification is that the role of the university

shifts into providing services, research, and labour to

the industrial sector of the economy (Washburn,

2006). The success of higher education is measured

quantitatively from the number of students that the

higher education system can recruit, the number of

graduates who obtain high-paying job, and income

earned from research and consultancy as deciding

factors that can increase the competitiveness of

higher education institutions. As of current, funding

of universities are mostly obtained from private

sources, ranging from domestic and international

student fees to donations because public funds have

been restricted. If the students are considered as

customers, the lecturers are assumed to be workers

who the management needs to monitor and control

(Ryan, 2012).

3 GLOBALIZATION AND

INTERNATIONALIZATION

Meek (2002) states that internationalisation has long

been a part of higher education practice, particularly

in Europe. Nevertheless, internationalisation has

only recently emerged to be under more formal

coordination. In the period between 1980s and

1990s, market-entrepreneurial principles replaced

traditional structures and transformed public sector

institutions, including higher education in Anglo-

Saxon countries. According to Amaral (2008), the

transformation of higher education in developed

countries observed to have taken place in the last

decades is a part of Western society’s restructuring

process. Pertaining to this matter, concepts from the

private sectors such as efficiency, utility, public

accountability, and enterprise have replaced

traditional values. New public management (NPM)

has been introduced, in which higher education

institutions are adopting private-sector techniques

(Amaral. 2008).

The introduction of NPM in universities was

subsequently followed by the introduction of

research funding systems that are based on

performances. Hicks (2012) observed that 14

countries have introduced this system under varying

names. The purpose of the funding, in general, is to

maintain research excellence by responding to

international competition, which demands high

scientific quality. Unit analysis, methods of

measurement, frequency, and census periods of

evaluation for performance based research funding

are not the same in every country. Hicks (8) argues

that, generally speaking, research is not

implemented individually or within department

levels, it is conducted by a group/cluster instead, yet

a small number of countries, such as New Zealand

and Spain, individually evaluate the research.

4 QUALITY ASSURANCE

Quality assurance emerged as a special focus of

regulation in the higher education sector at the end

of the 19th century when the first accreditation

organization appeared in the United States (US).

Moreover, quality assurance had begun to develop in

Western Europe, Australia, Canada and New

Zealand. Beginning in the late 1960s to the 1980s,

these issues were internalized within the government

and they were managed through traditional

bureaucratic arrangements, although it was

accompanied with increasing pressure for greater

accountability, efficiency, and transparency of the

university sector, and this was driven by

conservative government elections in various Anglo-

Saxon countries in the late 1970s. Key changes to

traditional oversight mechanisms occurred in the UK

with the publication of a White Paper by the

government in 1991, Higher Education: A New

Framework, which suggested not only the removal

of binary divisions between universities and

polytechnics (allowing the later to assume a

university degree) but the establishment of a new

Higher Educational Quality Council (HEQC).

Based on a survey about quality assurance

frameworks in France, Belgium and the Netherlands,

Neave (2004) concludes that the purpose of quality

assurance has not been agreed upon. However,

quality assurance has become a basic principle of

neoliberalism in higher education, and under

neoliberal management, the universities are

subjected to mechanism under performance based

evaluation. Evaluation and assessment relating to the

performance of a university and its academic staff

are considered as strategies to ensure the quality of

higher education. Academic life is shaped and

framed by performance evaluation and assessment

on research and the outputs of academic activities

such as awards, grant, consultation and the impact of

research, and the quality of teaching. These aspects

of academic performance are highly crucial to

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1591

determine the recruitment process, academic career

advancement, and promotion.

Normatively, universities are regarded as

institutions that provide academic freedom, freedom

of thought and expression, heterodoxy and

exploration to create new knowledge. However,

practically speaking, colleges must adapt to a series

of regulatory regimes that seek to manage, direct,

and control the sector in ways that serve the interests

of the state and economy by applying principles of

efficiency, value, and performance

5 NEOLIBERALISM IN HIGHER

EDUCATION AND

INEQUALITY

It is suggested in the theoretical literature that one of

the vital means in which competition and the

resultant inequality have been produced in the

academy under neoliberalism is through the ranking

and audit processes (Berg, 2016). Our well-being in

higher education is significantly impacted by these

ranking and audit systems, and their resultant

production of inequality and predacity. According to

a number of studies in the west, neo-liberalism has

impacted on Western countries’ strengthening

inequality, which has been existent even prior to the

period of neoliberalism. Bagilhole (2001) believes

that higher education has always been the arena for

middle-and white-skinned males bearing unequal

cooperation mechanisms. The academic world has

developed into an extremely competitive domain

with constant conditions in which academics may be

categorized into two differing groups: academic

groups that can exist in the academic world and

those who do not exist. Under the neoliberalism

system, the determining measures of success in

academic care are becoming more obvious. Those

who are considered as being unproductive will

subsequently be eliminated of their own accord. In

the western neo-liberalism system, the academic

community is no longer a class category as it has

turned into a profession that underscores personal

competence (Read 2009).

By the end of the 1990s, protests against neo-

liberalism, commodification, and commercialisation

of higher education had become exceedingly

expansive so that the development of market

capitalism was not as determined as it was expected

to be. Several numbers of leading higher education

institutions around the world responded to The

World Trade Organisation’s (WTO) GATT treaty by

signing a declaration. The basic principles of the

declaration are: First, higher education is a public

interest, not a commodity; Second, higher education

must be organised by a competent body designed by

any country; Third, higher education is aimed at

exporting high quality education, not undermining

developing countries; Fourth, higher education

internationalisation should be based on high quality

academic service; Five, quality must be the key

objective for both domestic and international

education regardless of the way of delivering higher

education; Sixth, a rules-based regime must guide

international co-operation; Seventh, higher education

is not similar to other commercial parts of the

service sector; Eighth, the interdependency of public

and private higher education; and finally, ninth and

tenth are cautiousness and transparency (Meek,

2002).

Nevertheless, a number of significant changes

had occurred in the academic environment in liberal

countries during the period of neo-liberal policy and

global markets. As an example, trend showed

decreasing public funding despite the fact that

universities were being publicly funded. As a result,

universities were urged to increase the funding they

acquire from the private sector. Many universities

had subsequently choose to employ more part-time

or contractual staff to address the issue of

progressively increasing operational costs. Such

strategy was selected as it was considered to be more

cost effective and less expensive because the pay for

a part-time staff member covers only one academic

course for one activity, and they were only paid for

their teaching time. Another change that took place

during that period is that corporate-style managers

and professional administrators had consequently

taken control of the decision making process in

universities, while formerly, in the past decades, it

was the academicians who led in the decision

making process. Universities are currently expected

to adopt business like or corporate practices. There

are now non-academic professions involved in

universities, which include activities such as

marketing, finance, student services, human

resources, and quality assurance. This may actually

providea chance for administrators working in

universities to build a career path, although it may

simultaneously reduce freedom and cause hyper-

bureaucracy for academics. Such managerial

practice is considered as justifiable by the crises or

budget shortfalls which undoubtedly require

professionals, such as accountants (Baker, 2012). In

addition to that, the use of new electronic procedures

in recruiting academiciansenables candidates from

around the world to apply for those roles. Aside

from the expectation that new academic recruits

have completed their doctoral degree, their entry

qualification put emphasis on teaching and research

experiences, as well as peer review publication.

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Productivity, profile, and the national and

international reputation of the university have

become regarded by both the government and public

universities as indicators pertaining to the quality of

higher education (Baker, 2012).

6 HIGHER EDUCATION,

NEOLIBERALISM AND

INEQUALITY IN HIGHER

EDUCATION IN INDONESIA

Academic systems applied in numerous developing

countries, such as Indonesia, are different to that

found in liberal and industrialised countries, where

more complex systems are developed. Even so, we

can trace back some aspects of these academic

systems in Asian countries to the Western academic

system, such as the patterns of institutional

governance, the rhythm of academic life, the ethos

of the academic profession, ideas about science,

examination and assessment (Altbach 1989: 3-4).

There are at least two significant elements that set

the stage for the emergence of universities in Asian

countries: first, the influence of foreign systems;

second, the spirit of indigenisation. In general, the

impact of Western academic systems has been of

utmost importance, due the influence of colonialism

throughout history. For instance, Dutch colonialism

has influenced Indonesia; whereas British

colonialism influences India, Malaysia, and

Singapore; while American and Spanish colonialism

has influenced the Philippines; and French

colonialism influences Vietnam. However, long

before the advent of Western colonisation, Asian

countries maintained a significant intellectual

tradition, such as the impact of Buddhism from

India, Islam from the Middle East, and

Confucianism from China (ibid).

However, in comparison to higher education

systems and academic career advancement of liberal

countries, Indonesia has developed quite a different

system of universities, academic life, and academic

careers. The current secular higher education system

is managed and governed under the Ministry of

Research & Technology and Higher Education

(MoRTHE) and the Ministry of Religious Affairs

(MoRA). In addition to this arrangement, the

education system is further separated into public and

private institutions (Wicaksono&Friawan, 2011).

Enrolments grew from less than 1 million pre-1990

to 2.68 million in 1995, and by a further million

again to 3.87 million in 2005 (14). Currently,

enrolments stand at 5.38 million (Pangkalan Data

Dikti [Indonesian Higher Education Database]

2016a) (Brewis, 2018).

Two aspects of neoliberalism (commodification

and quality assurance) have been considered quite

common within the higher education system in

Indonesia. On the other hand, internationalisation

remains to be rarely discussed. Commodification is

very close to the issue of inequality, while

accreditation and quality assurance are close to the

problem of job dissatisfaction among academic staff.

In 1999 and 2009 the Indonesian government issued

the following policies: BHMN/Badan Hukum Milik

Negara (State Owned Legal Entity) and BHP/Badan

Hukum Pendidikan (Education Legal Entity)

respectively. The government had reduced subsidies

and made four prominent public universities into

BHMNs (14). Commodification of higher education

is very clear because the policy allows university to

introduce a controversial strategy called a ‘special

track’ admission system (jalur khusus12). A

minority of students who pay dramatically higher

fees were guaranteed to be accepted at thosefour

prominent public universities. Cross-subsidy

strategy was applied by higher education institution

managers, therefore, the majority of students who

were selected on merit can pay less tuition (Brewis,

2018).However, this strategy hadput students from

lower socioeconomic backgrounds at a disadvantage

because they were only given a small proportion of

being accepted in those prominent public

universities. Later, in 2010, the Constitutional Court

declared the BHMN and BPH as unconstitutional,

yet Law 12/2012 on higher education reinstated the

policy and renamed the BHMN and BPH into

PTNBH/Perguruan Tinggi Negeri Berbadan Hukum

(State Higher Education Legal Entity).

The goal relating to accessibility and availability

has been addressed explicitly within Law 20/2003,

and it emphasizes the goal of improving equal

access to education. These discourses are based on

the constitutional aim to ‘develop the intellectual life

of the nation’ (mencerdaskan kehidupan bangsa),

and it is aligned to thePancasila. Chapter 5 of Law

20/2003 outlinesthe rights and obligations of

students wherein every student in every school/HEI

is eligible for (1) a scholarship –or (2) tuition fee

waivers– if their parents cannot afford to put them

through school/HEI and they are outstanding

student. The 2003 law mandates 20% of the

State/Regional budget to be allocated to education,

excluding salaries for teaching staff. Article 5 (Read,

2009) states that every citizen has anequal right to

access quality education. Another aspect to address

social justice for reducing inequality is that the

policy mentioned about eliminating discrimination

in all categories of higher education be it public,

private, religious, and secular. (2) However, the law

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1593

is considered to have adopted a neoliberalism stance

as it underscores efficiency and accountability in the

management of schools and universities.

In terms of accreditation, there is auditing

practice carried out by the National Accreditation

Board for Higher Education (BAN-PT) which

develops academic as well as managerial standards

and conducts audits for all study programs in

Indonesia. This institution has a very strong

legitimacy because the Education Act of 2012 HE

Law states that accreditation by BAN-PT is

mandatory, and without accreditation status,

universities are unable to publish diplomas, and the

degrees students attain will be considered invalid

even though they have completed their degree

(Rosser, 2015).

The quality assurance of higher education in

Indonesia is measured by quantitatively assessing

the success of higher education based on several

factors that are regarded as capable of increasing the

competitiveness of higher education institutions such

as the number of students who completed their study

on schedule, the GPA (Grade Point Average), the

number of alumni who obtained a job with good

salary, and income earned from research and

consultancy. Another aspect of accreditation and

quality of assurance is the assessment of academic

staff. In order to obtain a high accreditation score,

higher education institutions must employ and

promote their academic staff to reach certain criteria.

Assessment and monitoring of academic staff have

always been required not only for accreditation of

higher education institution but also for academic

staff promotion and remuneration. Under the new

system, called Beban Kerja Dosen or BKD

(academic staff obligation), academics are required

to fulfil all three activities ((Tri Darma Perguruan

Tinggi) as being eligible for the monthly incentive

requires them to follow the rules. Academic staff

performance will determine their individual as well

as the higher education institution performance.

In this regard, Gaus (2015) argues that

academics perceive negative advantages towards the

shift in accountability and quality assurance because

they are challenged by multiple roles and

responsibilities. Academics are increasingly subject

to administrative-related tasks because the system of

accreditation and quality assurance require them to

compile, scan, and upload files and document as

evidence for accomplishing their three functions

(teaching, research, and community engagement).

The lecture monitoring and assessment implemented

by the government have ruined the motivation to

accomplish their job. Some lecturers are worried

about being trapped in data manipulation practices to

meet the government’s requirement pertaining to

assessment and monitoring. The situation, which

may be described as being ‘over regulated’, has

made academic staff lose their critical thinking, and

they recently consider themselves as always being

the government’s object for‘character assassination’.

The inequality issue found in Indonesian higher

education may be traced back to the reality in which

there is a dual system applied in terms of

management by the ministry (religious higher

education under MORA and secular higher

education under MORTHE) and higher education

status (public vs private institution).Although

neoliberalism does not directly influence this factor,

the three neoliberalism principles (commodification,

internationalization, and quality assurance) will

create greater inequality not only between higher

educations but also in the quality of alumni from

those institutions.

Such dual system of secular and religious

universities in Indonesia can actually be traced back

to the Dutch colonial era in which Islamic education

alone was developing alongside the Dutch system.

During this era, the Dutch system education was

merely accessible to Europeans, leaving Islamic

schools as the only option for Indonesian natives. Ki

Hajar Dewantara, a leader of the upcoming national

movement established at the end of the 19

century

called Taman Siswa (McVey 1967), had proposed

an alternative education system different to that of

the Dutch. The basic concept was to introduce and

develop an Indonesian-culture-based education

system aimed at facilitating nationalism, advancing

principals of humanity, and providing freedom of

development for children.

Aside from the Dutch colonial system, the

Islamic education system had already existed in

Indonesia since the 17

century. Education has

always played a vital role in popularising and

maintaining the currently existing religions in

Indonesia, particularly for Muslims and Christians.

Nevertheless, the Christians find it easier adapting to

the modern education system the Dutch had

introduced. Jones (1976: 38) opined that it is less

difficult for Christianity to accept westernisation and

modernisation since both are interrelated, and

education is an inseparable piece of both elements. It

can, thus, be assumed that Christians are able to

easily adapt to public and secular schools. Even so,

the Christians have aggressively been establishing

private schools.

Meanwhile, the Muslim community had to

endure a rather lengthy process to accept the modern

education system. A crucial consideration should be

taken into account here, wherein the most vital

aspect of Islamic education is to attain total

submission to Alloh (God). The education system is

merely a tool for achieving that main objective.

According to Islamic teachings, knowledge can be

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1594

specified into two categories: revealed knowledge

through the Prophet Muhammad and scientific

knowledge acquiredvia scientific methods such as

observation and research (Zakaria 2007).

Concerning religious higher education, one of

the reasons for establishing Islamic higher education

institutions was the need for functional personnel at

the Ministry of Religious Affairs (MoRA). In

accordance with the dual system discourse applied to

primary and secondary education, the government

also implemented a dual system for universities. In

this case, the MoNE manages the following post-

secondary level organisations: Universities,

Academies, and Institutes; whereas, the MoRA

manages the following tertiary level institutions:

Sekolah Tinggi Agama Islam/STAIN (State of

Islamic Studies College), Institute Agama Islam

Negeri/IAIN (State Institute of Islamic Studies), and

Universitas Islam Negeri/UIN (State Islamic

University). This was initially named Akademi

Dinas Ilmu Agama (ADIA), but it is subsequently

referred to as PTAIN (Perguruan Tinggi Agama

Islam) (Zakaria, 2007).

In addition to the dual religious and secular

systems, Indonesian education is generally

maintained by the government for public schools,

while private schools are also available. Indonesian

higher education institutions are, thus, categorized

into public and private institutions, legally approved

since the 1950s and reinforced by Law 30, 1990

(Welch, 2007). The history of public universities can

be traced back to the founding of Gajah mada

University and the University of Indonesia in the

immediate post war period (1945 to 1950s). The

government initiated to establish the universities.

Upon Indonesia’s proclamation of independence,

Balai Perguruan Tinggi Indonesia (Home of Higher

Education of the Republic Indonesia) was

established in Jakarta. However, political instability

and intensifying conflict between the Dutch and

Indonesians forced the institution to relocate to

Yogyakarta, which was made into a temporary

capital during Jakarta’s reoccupation by the Dutch,

and subsequently to Klaten (a small town in central

Java). Given the reestablishment of Indonesia’s

sovereignty after the end of the seven-months

conflict, a regulation was issued by the government

concerning the higher education facilities in

Yogyakarta and Klaten to become Universitas

Negeri Gadjah Mada (Gadjah Mada State

University/UGM) (Cumming & Kasenda, 1989).

According to Hill and Wie (2013), private

universities are a recent phenomenon, although two

private universities, the Indonesian Islamic

University (UII) in Yogyakarta and National

University in Jakarta, were set up in 1949 as soon as

the Dutch colonials withdrew from Indonesia

(Welch 2007: 670). A number of prominent private

universities such as Tarumanagara University and

Trisakti University were subsequently founded in

the 1960s (Hill and Wie, 2012, 166). The

establishment of private higher education was

provisioned in the 1950 Basic Education Law, which

was eventually ratified into Law 12/1954. Similarly,

the permit to establish a private university was

provisioned in Law 15/1961. Nevertheless, the

government had not given much attention to private

universities until 1990 (ibid).

Generally speaking, the development of private

higher education can be perceived based on the

situation in 1970-1980 where higher education

enrolment was at its peak point. In thirty-five years’

time, the enrolment rate had reached 3.4 million,

which is an increase by nearly twenty folds (Buchori

Malik, 2004, 260). Private universities rapidly

developed due not only to increasing demand but

also the government’s inability to supply that

demand. Hill and Wie (2013, 161) distinguished

several element spropelling the growth of higher

education in Indonesia, and private higher education

did rapidly develop. The state’s education for all

principle had indeed impacted the demand for higher

education among students. Given that Indonesia is a

lower middle-income country, Professional

qualifications are a vital requisite in today’s labour

market, skilled workforce is required to obtain

professional jobs. Likewise, teachers and

professional civil servants are required to possess at

least a Bachelor’s degree, thereby increasing the

demand for higher education, and leading to a

substantial increase in the development of private

universities.

Moreover, the fact that Islamic educational

institutions had been established even prior to the

Dutch colonial period may be regarded as another

supporting factor that contributed to the proliferation

of private institutions. Islamic organisations, such as

Muhammadiyah, have played a substantial role in

developing private universities in numerous places

throughout Indonesia. The organisation established

the first Muhammadiyah University in Jakarta in

1955, and many other Muhammadiyyah Universities

were eventually founded in several cities both in and

out of Java. Nahdlatul Ulama (NU), another Islamic

organisation, is highly devoted to the Pesantren

tradition, or the traditional Islamic system (Welch,

2012).A number of pesantren managed by Nahdlatul

Ulama have institutionally or culturally contributed

to the establishment of Islamic higher education,

such as the University of Hasyim Asyáry which was

established in 1967.

Other than religious organisations or leaders,

businessmen or ethnic communities also establish

private universities, which are stand-alone

Neoliberalism and Inequality in Higher Education

1595

institutions. They are not limited to Islamic

organisations as Christian organisations have

established private universities as well such as Pelita

Harapan University, Res Publica University,

Profesor Mustopo University (Hill and Wie, 2013,

Welch, 2007). Students of Chinese descent usually

dominate these elite private universities (Hill &Wie,

2012).

A crucial point to consider is that private

education institutions in Indonesia are different from

private schools in developed countries. Public

universities are favoured since they are regarded as

having better quality and lower tuition fees.

Applicants wanting to study at public universities

must face immense competition because only one in

six candidates is accepted. In general, students who

gain entry to public universities are from high-

income families. One of the reasons is that students

from average income or poor families find it

difficult to compete with those who are better

prepared for the enrolment test by being able to

afford preparatory courses allowing them to become

familiar with the examination questions. Students

who fail the public university enrolment test will

most likely pursue their education at a private

university.

While there is exceedingly high demand for

private universities brought about by the

government’s inability to provide sufficient amount

of higher education facilities for all students, these

education institutions are confronted with the

enduring challenge of low academic quality and

weak financial capacity. Most of these private

institutions are unable to provide quality learning

process akin to that experienced at public

universities. Hill and Wie (2013: 161) observe that

some elite-private universities may be able to

provide proper learning and teaching quality, yet the

majority of them could not be expected to do so.

The fact that the majority of private education

institutions are predominantly established for lower-

income households (except for elite-private

institutions) should be taken into consideration. The

decision to attend a private school is primarily due to

failure of gaining entry into public university during

the academic selection period. This consequently

leads to an under-representation of students coming

from rural/remote areas and from economically

deprived families in the public system. The

education quality in rural areas is not on parwith its

urban counterparts. Bangay (2005: 170-171)

concluded that private schools provide their services

to disadvantaged students. The financial system

implemented in private higher education is not

unlike private schools in general, where their income

is obtained from tuition fees and donations as they

receive very limited public funding. They, as a

consequence, would depend on part-time academic

personnel who are paid by the hour and teach in

more than one institution (Welch, 2007).

7 CONCLUSION

Neo-liberalism principles such as commodification,

internationalization, and quality assurance have been

reproduced in several countries, including Indonesia,

and they have altered the orientation of education in

higher institution of learning. It has been responded

negatively, yet the process has persisted and is

sustained in various patterns. In the era of

capitalism, the university underwent a

transformation from university as a place of learning

into a corporation that is primarily concerned with

market share, serving the needs of commerce,

maximizing returns and economic investment, and

gaining competitive advantage. The transformation

occurs as a result of 'economic rationalism', which is

characterized by the reduction of government

funding for universities, the shift of university

orientation from fulfilling the needs of the elite to

fulfilling the massive educational needs for all

classes. Audit, performance indicators,

benchmarking, targeted management, periodic

teaching quality reviews are technologies that have

been used to disseminate university management

methods under the capitalist system. Those measures

have been considered to maintain inequality among

students and job dissatisfaction among academic

staff.

The academic system in Indonesia has

developed differently to that of the international

system. The policies and practices of academic life

in Indonesia are undoubtedly shaped by the

prevalent dual system of religious and secular

universities, public and private universities.

Indonesia’s colonial history has consequently led to

independent higher education system having very

limited relation to the international system. Aside

from public and private institutions, higher

education in Indonesia is specified based on whether

it is a religious or secular institution. Unlike private

institutions in developed countries, private higher

education institutions in Indonesia are allowed to

proliferate due to the government’s inability to

accommodate the high demand for higher education

enrolment. These private institutions in Indonesia

only have access to extremely limited public

funding.

Students with the highest achievement level

coming from the highest-economic households

commonly attend public secular universities. Some

private secular universities are considered on par

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with public secular universities in terms of quality,

their number, however, is very limited. Most of

private universities with low quality are the only

option for students coming from middle or lowest

economic households.

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