Tuition Fees in Germany

Jens Schulz

Jens Schulz is a research intern at AICGS during the fall of 2014, where his duties include writing the AICGS Notizen Weekly, assisting with the contact database, summarizing AICGS events, and contributing to the AICGS Notizen Blog, as well as Social Media. He is particularly interested in the Foreign & Domestic Policy and Business & Economics Programs at AICGS, focusing on international relations theory, foreign policy, as well as education policies in Germany.

As a fellow of the Adenauer Foundation, Mr. Schulz is currently enrolled in the Graduate Gateway Program at American University in Washington, D.C. and is pursuing a master’s degree at the University of Göttingen. He graduated from the Georg-August-Universität Göttingen in the summer of 2014 with a bachelor’s degree in English and Political Science. Mr. Schulz intends to eventually pursue a career in academia and education.

In the 2013-2014 academic year, tuition fees for undergraduate students at American universities averaged a whopping $5,410 (€4,353) each semester—and this does not include housing, dining costs, or personal expenses.¹ Apart from occasional criticism and debates, tuition fees have never stirred major political protests on this side of the pond. When German students were obliged to pay €500 a semester a decade ago, they rushed to the local authorities, courts, and streets to abolish tuition fees. From an American point of view, this seems hard to grasp. Now that Germany has again abolished all college tuition and returned to the original system, it is time to reflect. Where does the German aversion to tuition fees stem from? What were the arguments made in the debate? Did they prove to be valid? Why were tuition fees outlawed after less than a decade?

New Institutional Framework Allows Tuition Fees

Admittedly, studying at a German university has never been completely free of charge. Even before the Bundesverfassungsgericht (German Constitutional Court) repealed the former revision of the Hochschulrahmengesetz (German Higher Education Framework Act), students had to pay €200 to €300 per semester. This payment was generally used for the student union, the student administration, and oftentimes a semester ticket for public transportation.² However, the bulk of higher education costs—amounting to €34.3 billion in 2011-2012³—was covered by the German taxpayer. Still, German universities were suffering from overcrowding, underfunding, and the troublesome conversion from the German diploma to the Bologna process’s bachelor and master system.⁴

The institutional reason against tuition fees was based on the premise of the Hochschulrahmengesetz, which had outlawed the collection of tuition fees for thirty-five years.⁵ When the coalition of Social Democrats (SPD) and Greens (Die Grünen/Bündnis 90) reformed the legislation in 2002, states governed by the Christian Democratic and Christian Social Union (CDU/CSU) toppled the law, as they saw a violation of the states’ exclusive right to regulate education. Once the Bundesverfassungsgericht outlawed the abolition of tuition fees on 25 January 2005, the states of Lower Saxony and North Rhine-Westphalia were the first to introduce tuition fees in the Winter Term 2006-2007.⁶ While many West German states followed suit, the eastern German states, including Berlin, refrained from this practice. These states seized the chance to have a competitive advantage over western states, which demanded college tuition. This inequality among the states, as well as the renunciation of a valued tradition, was highly controversial with students, parents, professors, and opposing politicians.

Tuition Fees Raise Social Concerns

Apart from a strong focus on vocational training, Germany has a long-standing tradition of research-focused universities with many globally high-ranking institutions.⁷ As a Western European welfare state, Germany acknowledges universal access to education as a cultural human right. Admission to German universities has generally been based on student merit. This practice was in accordance with the idea of equality of opportunities, since an individual’s performance was taken into consideration, not the financial liability of the student’s family. The introduction of tuition fees violated this basic principle of the German education system. Opponents of tuition fees argued that this practice contradicts the German principle of solidarity that corresponds to the German welfare state.⁸

The main charge against tuition fees was that they would decrease interest in studying at a German university. Additional costs would pose an exclusionary threshold, particularly to students from families without an academic background and lower financial capability.⁹ In any case, €500 would present more of a burden for low-income families than more affluent members of society.⁹ Instead of overcoming social disparities, critics claimed that this development would favor wealthy students and discourage social mobility. The Constitutional Court judges explicitly respected these fears when they highlighted the social compatibility of tuition fees. Students from low-income families should not be discouraged from studying because of financial burdens imposed by tuition fees.

The standard instrument to guarantee equal access to higher education is the BAFÖG system, which provides funding for students whose financial situation requires state support. These monthly payments depend on the income of the student’s parents and cannot exceed the monthly limit of €670. Students only have to pay back half of the loans without interest, starting five years after the completion of his/her degree.¹¹ After the introduction of tuition fees, these income-dependent loans were supplemented by student loans with fixed low interest rates (usually around 4 to 6 percent) by state banks. These income-independent loans were only to be paid off after the graduation of the student.¹² However, this option was used by only 11 percent of the student body, with most students depending on their parents’ financial support (71 percent). Students averse to indebtedness at an early age often decided to work part time to finance their studies. Even though this had detrimental effects on their school performance and prolonged their studies, 43 percent of students earned extra money through part-time jobs.¹³

Realities Disprove Many Concerns

Despite these concerns, studies disproved the claim that tuition fees would prevent young adults from pursuing a college degree. This also holds true for women and children from non-academic backgrounds.¹⁴ The majority of students and potential students (54 percent) made the decision to study independent of the existence of tuition fees.¹⁵ Rough estimates put the total number of students who were discouraged from beginning higher education in the fall of 2006 at 6,000-18,000.¹⁶ Even if that number seems fairly high, in reality it is marginal given the total number of 1,979,445 students in 2006-2007.¹⁷ Furthermore, many other factors played into the young adults’ decisions not to begin their studies.

Since the ruling of the Bundesverfassungsgericht explicitly strengthened the legislative power of the states, the results varied greatly among the different states in Germany. Opponents of tuition fees lamented the inequality among German states because most western states, such as Bavaria, Baden-Württemberg, North Rhine-Westphalia, and Lower Saxony, collected tuition fees, whereas the eastern states, such as Thuringia and Saxony, granted free admission. Nevertheless, the influx of western students to eastern German universities remained at a low level. German students appear to be rather immobile when choosing their place of study.¹⁸

Tuition Fees as Incentives to More Efficient and Qualitative Education

Proponents of tuition fees emphasized the benefits for higher education. Since the law guaranteed that the additional revenues would only be used for the universities themselves, students could rest assured that their money would solely be invested into their own education. Even though the allocation was not truly transparent, universities were better funded, equipped, and more academic tutors and instructors guaranteed a higher quality of education.¹⁹

Others might have rejoiced in the fact that tuition fees provided incentives to finish degrees in the standard study period. Shortly after the introduction of tuition fees, a respectable 66 percent of German students were motivated to graduate as soon as possible.²⁰ Formerly, some had considered studying longer than necessary—a German tradition. With more people graduating quickly, young professionals could enter the job market at a younger age. This would give them more opportunities to gain work experience and improve their employment chances. Defenders of tuition fees further argued that German tuition fees of €500 were still comparably low, whereas globalization of education and the ongoing European integration required more competitiveness and comparability.²¹ As they prevented long-term students effectively, tuition fees increased the competitiveness of German graduates. This view also assumed that it is not the €500 that endangers students financially, but that rising rent, utility, and grocery prices are far more worrisome than low tuition costs. The average living costs of a German student, including rent, clothes, and books, amounted to €750 a month, which represented more than the semi-annual tuition costs.²²

German Higher Education Explores Alternative Models of Funding

Amid growing complaints about tuition fees, former Federal Minister of Education and Science Annette Schavan promised to enhance the German scholarship system in 2010. While merely 2 to 3 percent of German students obtained scholarship funding, Schavan planned to increase the number of scholarship recipients to 8 percent through joint federal and private sponsoring.²³ In the meantime, this scholarship program, the so-called Deutschlandstipendium, has been realized, but its acceptance fell way behind expectations, with 0.76 percent of German students making use of it. Even though the federal budget provides a total of €47 million for the Deutschlandstipendium, only €21 million is requested by students at this point. The remaining amount goes back to the treasury and will be used elsewhere.²⁴ On a more positive note, these developments will continue to increase the amount of scholarships in Germany even after the repeal of tuition fees.

Universities like Göttingen and Cologne have shown alternative models of generating higher revenues without tuition fees. Through their legal status of “foundation universities,” both schools can attract private and corporate sponsors and endowments much more easily than comparable universities. While adhering to strict academic standards, this allows universities a higher degree of independence from state control. Thus, they can develop entrepreneurial strategies and management structures, which will increase their competitiveness in the long run.²⁵ Apart from that, as of 2005, the federal “Initiative of Excellence” provided additional funding of €1.9 billion to selected universities. Over the time span of five years, the initiative narrowed the circle of elite universities from thirty-six to nine universities, which increased the competition among and within universities dramatically. The initiative achieved higher quality and global competitiveness of German higher education without making the students pay for it.²⁶

Repeal Process and the Post-Tuition Fee Situation

But why is it that tuition fees were abolished so quickly? The answer is political: The coalition of Social Democrats and Greens on the state level has continuously opposed tuition fees that were established through many of the Conservative and Liberal coalitions in western Germany. Amid the fading public support of tuition fees, this issue became an important point in state elections. With Social Democrats and Green Party coalitions taking over many state legislatures over the last decade, repeal of tuition fees has been gradual. Whereas Hesse was the first state to abolish tuition fees in 2008-2009, Lower Saxony was the last to eliminate them in the winter term of 2014-2015. After the Social Democrats and Greens won the Lower Saxony state elections in January 2013, it took them one and a half years to fulfill their promise, which had played a major role in the election. First, they had to settle the question of continued university funding. Now, the state of Lower Saxony is reimbursing universities for the missing revenues from tuition fees. Since these continued programs are funded by German taxpayers, the allocation of these costs is much less transparent than through direct tuition fees. The argument that was used against tuition fees has to apply equally to other sources of funding. What is to come after this limited period is still unclear and subject for further discussions.

Germany’s universities are now basically free of charge again. Apart from fees for long-term students and the regular contributions to the student administration, all tuition fees have been effectively eliminated. The storm has passed. What did we learn from this socio-political experiment? First, we can agree with the impression of many Americans: The debate over €500 a semester was completely blown out of proportion. Given the monetary sum and the implications it had, many bystanders were left shaking their heads. But the debate also showed how politically active German students are and how firm their belief in the German welfare state is. They had the choice between additional quality of education and equal opportunities for education. In trusting the existing quality of German universities, the students chose equal opportunities. One might even suspect a correlation in the repeal of tuition fees and the constant increase in student numbers. Compared to 2,019,831 students in 2003-2004, the winter term of 2013-2014 counted 2,616,881 students enrolled in German universities. This drastic increase of 29.55 percent over ten years represents the largest number of students in German history.²⁷

 Table A

References

1. College Board, Trends in College Pricing, Trends in Higher Education Series (College Board, 2013), 3.

2. Hans Georg Petersen, “Studiengebühren – Chancen Und Risiken einer Reform der Hochschulfinanzierung” (paper presented at the Hochschulen im Wettbewerb – Mehr Lehrqualität durch innovative Finanzierung, Mannheim, Germany, February 18, 2006), 18.

3. Silvia Vogel, Harald Eichstädt and Marc Becker, Bildungsausgaben. Budget für Bildung, Forschung Und Wissenschaft 2011/12 (Wiesbaden: Statistisches Bundesamt, 2014), 7.

4. The Economist, “On Shaky Foundations. The Effort to Improve German Universities Still Has a Long Way to Go,” The Economist, 25 June 2009, <http://www.economist.com/node/13914669> (27 September 2014).

5. Hans Georg Petersen, “Studiengebühren – Chancen Und Risiken Einer Reform Der Hochschulfinanzierung,” 3.

6. Tina Baier and Marcel Helbig, War All Die Aufregung Umsonst? Über die Auswirkung der Einführung von Studiengebühren auf die Studienbereitschaft in Deutschland (Berlin: WZB Berlin Social Science Center, 2011), 1.; Christoph Heine, Heiko Quast and Heike Spangenberg, Studiengebühren aus der Sicht von Studienberechtigten. Finanzierung und Auswirkungen auf Studienpläne und -Strategien (Hannover: Hochschul Informations System GmbH, 2008), 9-10.

7. Justin J. W. Powell, Comparing German and American Models in Skill Formation, AGI Transatlantic Perspectives (Washington, D.C.: The American-German Institute, AGI Transatlantic Perspectives, June 2009); Times Higher Education, “World University Rankings 2014-2015”, Times Higher Education, 1 October 2014, <http://www.timeshighereducation.co.uk/world-university-rankings/2014-15/world-ranking> (1 October 2014).

8. Federal Republic of Germany, German Basic Law, 1949.

9. Christoph Heine, Heiko Quast and Heike Spangenberg, Studiengebühren aus der Sicht von Studienberechtigten. Finanzierung und Auswirkungen auf Studienpläne und -Strategien, 1.

10. Tina Baier and Marcel Helbig, War all die Aufregung Umsonst? Über die Auswirkung der Einführung von Studiengebühren auf die Studienbereitschaft in Deutschland, 6.

11. Ministerium für Innovation, Wissenschaft und Forschung des Landes Nordrhein-Westphalen, “BAFöG,” Studium Finanzieren, 2014, <http://www.wissenschaft.nrw.de/studium/finanzieren/bafoeg/> (18 October 2014).

12. Christoph Heine, Heiko Quast and Heike Spangenberg, Studiengebühren aus der Sicht von Studienberechtigten. Finanzierung und Auswirkungen auf Studienpläne und -Strategien, 10–11.

13. Ibid., 60.

14. Tina Baier and Marcel Helbig, War All Die Aufregung Umsonst? Über die Auswirkung der Einführung von Studiengebühren auf die Studienbereitschaft in Deutschland, 18.

15. Christoph Heine, Heiko Quast and Heike Spangenberg,, Studiengebühren aus der Sicht von Studienberechtigten. Finanzierung und Auswirkungen auf Studienpläne und -Strategien, 32.

16. Ibid., 22.

17. Statista, Anzahl der Studierenden an Hochschulen in Deutschland vom Wintersemester 2002/2003 bis 2013/2014 (Wiesbaden: Statistisches Bundesamt, 2014).

18. Christoph Heine, Heiko Quast and Heike Spangenberg, Studiengebühren aus der Sicht von Studienberechtigten. Finanzierung und Auswirkungen auf Studienpläne und -Strategien, 22.

19. Christoph Heine, Heiko Quast and Heike Spangenberg, Studiengebühren aus der Sicht von Studienberechtigten. Finanzierung und Auswirkungen auf Studienpläne und -Strategien, 11–12.

20. Ibid., 35.

21. The Economist, “On Shaky Foundations. The Effort to Improve German Universities Still Has a Long Way to Go.”

22. Hans Georg Petersen, “Studiengebühren – Chancen Und Risiken Einer Reform Der Hochschulfinanzierung,” 12.

23. Heike Schmoll, “Schavan Verspricht Mehr Geld Für Studenten: ‘Dreiklang Aus Bafög, Stipendien Und Darlehen’,” Frankfurter Allgemeine Zeitung, 20 April 2010.

24. Anja Kühne, “Wieder Zu Wenig Stipendiaten – Die Erwartungen Der Bundesregierung Erfüllen Sich Nicht,” Der Tagesspiegel, 10 October 2014.

25. The Economist, „On Shaky Foundations. The Effort to Improve German Universities Still Has a Long Way to Go“.

26. Tim H. Stuchtey, The Excellence Initiative and its Effect on the German University System, AGI Transatlantic Perspectives (Washington, D.C.: The American-German Institute, 2008); Justin J. W. Powell, „Comparing German and American Models in Skill Formation“.

27. Statista, Anzahl der Studierenden an Hochschulen in Deutschland vom Wintersemester 2002/2003 bis 2013/2014.