Balancing financial autonomy and control in agencification

Abstract

PurposeThe purpose of this paper is to explore the practices of financial autonomy and control the emerging issue of agencification in the higher education sector.Design/methodology/approachThe practices are investigated using case studies from seven semi-autonomous state universities in Indonesia. The data were collected through semi-structured interviews with 17 respondents including university officials, policymakers, and experts. The interview results were analysed using an inductive-deductive approach.FindingsThis research highlights an unstable balance between financial autonomy and control practices in the universities. Autonomy supports agencification mainly by simplifying financial procedures and control is seen by university managers to be overemphasised compared to in the other state universities. Despite successes in introducing a business-like atmosphere within bureaucratic universities, questions about balancing financial autonomy and control remain.Research limitations/implicationsThe small number of cases implies limited generalisability. The two characteristics used, size and parent ministries do not represent all university variabilities.Practical implicationsAgencification has become a key reform practice for state universities. Rather than using a “one size fits all” approach, the government needs a repertoire of models for these institutions.Originality/valueThis study provides empirical evidence of agencification in the higher education sector with an emphasis on the financial dimension of autonomy and control in a developing country setting.