Gov’t universities are entering the nonprofit game in 2020. The government is looking at amending the Private and Nonprofit Universities Act (pdf) to allow state universities to set up nonprofit universities and colleges, Sedik Abdel Salam, who heads the ministry’s council for private universities, told Enterprise. Those new universities will be positioned to directly compete with their fully private and nonprofit counterparts and charge competitive prices. The plan, Abdel Salam says, aims to help public universities keep up with their private counterparts (obvious examples including AUC and GUC) and offer students another high quality choice, as well as accommodate a fast growing population of school graduates. Six state universities have already expressed interest in starting nonprofit arms.

Government nonprofit universities already exist, they’re just not arms of existing state-run universities. Examples include Nile University, Zewail University of Science and Technology, the Egyptian E-learning University, and the Egypt-Japan University of Science and Technology. There are also Rasheed University and City University of Cairo, which are both part of a plan to set up more state nonprofit schools in new cities. Currently, nonprofits can only be established by presidential decrees and do not become affiliated with an existing public university sponsor, but if passed the upcoming amendments would change this.

What will these amendments change?

#1 Independent administration: Nonprofits established as subsidiaries of already established government universities will operate independently from their parent state schools, Abdel Salam tells us. They will have an independent board of trustees and a governance structure that is in line with other nonprofit universities, he added.

#2 No support needed from state coffers: The new facilities will be largely self-financed through tuition revenues, with startup capital coming from the parent university, and will not draw additional finances from the state, Benha University President Gamal Said told us. his institution plans plans to set up Benha Nonprofit University. Once they’re up and running, the universities will themselves be “a source of support to the state coffers,” he said.

#3 Tuition competitive with other nonprofits: Benha Nonprofit will charge more than its public counterparts, but less than private universities, to gain a competitive edge. In exchange, the curriculum offered to students will be different from that taught in the sponsoring government universities, and be designed to “keep up” with those offered in private universities.

#4 Nonprofit curriculum with public school professors? The new universities will be more active in preparing graduates for the labor market, Said told us. Benha Nonprofit, which would be built on land allocated to the university by the state, plans to do this by teaching highly sought after subjects such as engineering, ICT, business management, and (at a later stage) medicine and other majors. Existing faculty members will be brought on board to teach in the new institutions, said Said. This would help the universities cut costs and help the state university system retain their professors, who often opt for private employers later in their careers. However, it remains unclear how these new universities plan to offer a curriculum that is different from state schools and teach new subjects, while relying on government university professors. Particularly in light of…

#5 No foreign academic partnership requirements: The new universities will be exempt from regulations currently in the works that will force any new private university set up in Egypt to form academic partnerships with foreign universities, according to Said. In our extensive feature on these new regs, we noted that their purpose was to raise the quality of education in the private and nonprofit sector and push them to seek international expertise when teaching new subjects. This rule is temporary for now, he added, hinting at the possibility that it may be revoked.

#6 Nonprofit university applicants to use UCAS-style enrollment system: Applicants to the new universities will apply through the UCAS-style enrollment system the government is planning for private and nonprofit universities, rather than going through the enrollment process followed by government universities, according to Said. The system, which is expected to be rolled out in the 2020-2021 academic year, will be a central online platform managed by the SCU, and handle applications for private and nonprofit universities. You can read our in-depth coverage of the new UCAS-style system here.

#7 Entry requirements for the nonprofit institutions will be different from both those of the sponsors and the private sector, Said told us, without commenting on how loose / strict they would be.

Currently, six state-funded universities have already filed paperwork to the Supreme Council of Universities (SCU), said Abdel Salam. They are waiting for the amendments to pass the House of Representatives, and for subsequent decrees that would see them established. Each of Cairo, Alexandria, Zagazig, Assiut, Suez Canal, and Minya universities are expected to inaugurate new nonprofit subsidiaries within the next two academic years.

Is this the state crowding out the nonprofit higher education sector? Some private universities actually welcome the move: The entry of government-sponsored nonprofit universities, or even new private ones, will help address a sizable demand-supply gap, Badr University President Moustafa Kamal told us. The number of applicants Badr University received this year exceeded 8k when the university’s entire student capacity is 2.5k, Kamal said. This is true of Badr and of all other private universities, he added.

By 2030, Egypt needs to have at least 100 open private universities, up from only 57 today, says Kamal. This would “enrich” higher education, and give existing universities a reason to improve their offerings to maintain their competitive edges.

Ebada Sarhan, head of privately-owned Future University is also of the same mind, saying that Egypt needs at least 50 new institutions in the coming years and that the expected regulations to encourage existing private universities and oblige new ones to form partnerships with foreign universities will help them maintain their leading positions.

Why not simply improve state schools? The funding gap is the most given reply. This new model provides a sustainable way for state schools to expand and improve their quality, without sapping additional resources from state coffers.

But are the regs for state nonprofits self-defeating? When pressed as to why state nonprofits are exempt from forming academic partnerships and non-state universities aren’t, Said tells us that government universities already have long-standing ties with foreign institutions that their subsidiaries can benefit from. Also unclear is how the state plans to improve on existing state education if they rely on state faculty members for the new wave of nonprofits.