Adding a quarter of the endowments to the resources of the Higher Education Fund by ministerial decree
In a strategic move aimed at bolstering the financial resources of the higher education system in Saudi Arabia, the Council of Ministers issued a decision approving amendments to the regulations of the University Higher Education Fund. This decision represents a significant shift in funding mechanisms, as it expands the scope of resources to include a quarter of endowments, thus opening new avenues for investment in human capital and supporting university infrastructure.
Details of the regulatory amendments
The decision included substantial amendments to the regulations, specifically Articles 4 and 9. Paragraph (1) of Article 4 was amended to explicitly state: “Acceptance of gifts, donations, bequests, and a quarter of endowments, in accordance with the applicable rules.” This amendment formalizes and legalizes the receipt of endowment proceeds, thereby streamlining the related administrative and financial procedures.
The amendment also included paragraph (1) of Article Nine, to clarify that the Fund's resources consist of "gifts, donations, bequests, and a quarter of endowments that the Board of Directors decides to accept." This change grants the Fund's Board of Directors significant flexibility and broad authority in organizing and accepting these resources in accordance with the Fund's strategic objectives, ensuring that they are directed to the most needed and impactful areas.
Context of Vision 2030 and Financial Sustainability
This decision cannot be viewed in isolation from the Kingdom's general direction under Vision 2030, which places great emphasis on increasing spending efficiency and achieving financial sustainability in government sectors, particularly education. This amendment aligns with the new university system, which aims to grant universities controlled autonomy and enable them to diversify their sources of income instead of relying solely on the state budget. Including endowments as an official funding source reinforces the concept of "productive universities" and supports the transformation of universities into institutions capable of self-financing their research and development programs.
The historical and developmental importance of educational endowments
Historically, endowments (waqf) played a pivotal role in the flourishing of Islamic civilization, with universities, schools, and libraries being managed and funded through charitable trusts. This initiative aims to revive this model of mutual support in a modern and organized manner. It is expected that this decision will encourage business leaders and donors to direct their endowments towards supporting higher education, with established safeguards to ensure the transparent and well-governed management of these funds.
Expected impact locally and regionally
Domestically, the influx of endowment resources will improve the educational environment, support research chairs, and provide scholarships for outstanding and financially disadvantaged students. It will also enhance the competitiveness of Saudi universities in global rankings by providing flexible budgets for research and innovation. Regionally, this model offers a precedent for integrating traditional Islamic finance tools (waqf) into the modern administrative structures of educational institutions, thereby strengthening the Kingdom's position as a leader in educational and economic development in the region.
