Education Service Delivery Economics of the Sri Lankan State University System: Cost Competitiveness, Concerns and Strategic Opportunities

Abstract

Given the national objective of developing Sri Lanka into a knowledge hub in the South-Asian region, the Sri Lankan State University system would be expected to play a pivotal role in developing the country’s human resource. Even though the national universities, through free education, have realized many achievements towards this direction, bureaucratic governance and budgetary constraints have limited the further development of the State-run national university system to cater to growing demands. This has forced candidate students to opt for alternatives offered by local and foreign private universities. There is also the perception that the present State university structure is cost-ineffective and thus is a burden on national coffers. This question of cost-competitiveness of the Sri Lankan higher education sector was subjected to examination in the present study. The results indicated that the State university system is significantly cost effective in producing graduates of internationally acceptable quality. An in-depth analysis on the discipline of Medical Sciences confirmed that the Sri Lankan State university system is capable of, cost-wise, competing with international universities in producing medical graduates. Letting the State university system suffocate within bureaucratic governance and budgetary constraints is thereby proven unwarranted as the system appears capable; not only of cost-effectively meeting the local demand for higher education but also of being internationally marketable, potentially becoming a true knowledge-hub, paving the way to earn foreign exchange to the national economy.