Does the UGC "control" how universities spend their money?
- The UGC adopts an accountable and transparent approach in ensuring the public money entrusted to the universities are applied meaningfully and of value for money. On one hand, the bulk of the subvention to universities are chiefly in the form of the block grant, which provides for a "one-line" allocation of resources for a funding period (usually a triennium) without prescription attached as to how it should be spent. In other words, the UGC will not intervene with internal management of resources of its universities, including finance matters. The major requirement is that such grant must be applied within the ambit of "UGC-fundable activities" while adhering to approved student number targets. Furthermore, universities enjoy full autonomy in determining the remuneration packages of their staff so as to utilise their resources in response to changing market needs and be more competitive in recruiting talents. On the other hand, the precise amount of the block grant has to be approved by the Finance Committee of the Legislative Council before the start of every triennial funding period.
- As regards the Earmarked Grant, which accounts for the remainder of the recurrent funding provided to universities, a separate budget is required from universities for the approval by the UGC, and should only be applied by universities within the prescribed ambit.
- Institutional finances are subject to professional accounting standards and external audit processes. Universities are required to provide regular reports on their finances to the UGC and are accountable for any unspent balances of the public funds.