Exploring the Rationale of Performance Based Funding for Malaysian Public Universities

The intention of this paper is to discuss the rationale for Malaysian public universities to implement Performance Based Funding (PBF) mechanism. Here, the funding mechanisms are systems based on allocating a proportion of education budgets relative to specific performance measures such as course completion, credit attainment, and degree completion, instead of allocating funding entirely based on enrolment alone. The implementation of PBF mechanisms has recently become a topic of heated debate in the education sector worldwide which has also increased the interest of researchers and policymakers to work on it. Since almost no study has looked into the applicability of PBF in Malaysia with the aims to contribute knowledge and fill the gap in the current research. Semi-structured interviews were conducted to answer the objective of this study. The positive functions of qualitative research methodology are to show that it can assist the researcher in obtaining in-depth information and to understand the subjective experience of the respondents. Thus, in this procedure, semi-structured interviews were adopted and targeted to obtain information regarding the applicability of the PBF mechanism from the budgeting and financial aspects. Participants who encompassed in semi-structured interviews were the senior officer from the Bursar Office of selected universities. The findings from the qualitative data showed that PBF mechanism is suitable to be implemented at Malaysian public universities. However, there were several issues that the government needs to be addressed before the PBF mechanism can be successfully implemented.