Model of higher education financing in context of the strategy of improving labour quality in Ukraine

Quality of students’ education determines quality of labour force in the economy so that it affects the process of building knowledge economy in Ukraine according to the strategy of economic modernization. Quality of higher education is getting worse nowadays. It happens for the most part because of the financial problems in this sector. The low financing level per student causes underpaying to professors, insufficient current and capital expenditures in universities. Thus the professors’ salaries in Ukraine appear to be a good deal smaller than those in developed countries and Russia. Taking into account these facts the author investigates actual problems of modernization of higher education financial system in Ukraine, considers benefits that might come from adopting the alternative financial model. In the article the indicators of quality and accessibility of higher education in Ukraine for existing and alternative models of financing are compared. Both of the models are considered to be mixed. It means that they assume the possibility of involving financial recourses from both public and private sources. But as these models are based on different concepts (binary concept in Ukraine versus concept of diversification in developed countries) the differences in organization of direct financing and programs of financial support to students are substantial. Considering the possibility of using the alternative model in Ukraine the author calculates the indicators of direct financing per student and financial accessibility of higher education. The conclusion is made that even under complicated economic conditions in Ukraine the alternative model appears to be more effective than existing one in terms of quality and accessibility of higher education. Comparing to the existing model the alternative one allows providing higher level of financing per student without the need to raise budget expenditures on higher education or reduce the number of students’ enrollment. Socio-economic stability and efficiency of expenditures in the higher education sector are the compulsory conditions for achieving the goal of improving higher education quality within the scope of using the alternative model of higher education financing.