Incomplete Independence
State universities are racing to generate new sources of income, yet without a solid foundation. Over the past decade, the 22 State Universities with Legal Entity (PTNBH) have, on average, established nearly 22 new study programs each. During the same period, state subsidies per student through the State Universities with Legal Entity Funding Assistance (BPPTNBH) declined across almost all PTNBHs. Both are symptoms of the same underlying condition.
Opening new study programs does indeed attract more students and increase tuition revenue. However, this step raises a more fundamental question. Is this expansion driven by academic relevance and broader access to education, or merely by short term financial pressure? The issue is not about the intentions of university administrators, but whether the chosen strategy addresses the root of the problem.
The root of the problem lies in the structural pressure weighing simultaneously on the three pillars of university funding. For decades, state universities have relied on tuition fees, research funding and partnerships, as well as allocations from the State Budget (APBN). Today, all three sources are weakening at the same time. Tuition revenue is constrained by public demands to prevent continuous increases in Single Tuition Fees (UKT), research funding and partnerships have become increasingly competitive, and State Budget allocations have not kept pace with growing needs. This situation has become even more challenging as operational costs, ranging from energy expenses to educators’ salaries, continue to rise beyond inflation.
Without sustainable new sources of income, universities are trapped in an unfair dilemma. Lowering tuition fees means compromising quality, while maintaining quality means placing a heavier financial burden on society.
PTNBHs are in the most strategic position to respond to this challenge. Their legal entity status grants them a level of autonomy unavailable to State Universities as Working Units (PTN-Satker) and State Universities as Public Service Agencies (PTN-BLU), while at the same time requiring PTNBHs to become pioneers rather than spectators.
Dormant Assets
The first breakthrough does not need to come from outside, as its potential lies within university grounds themselves. On average, PTNBHs own more than 50 hectares of land, yet less than 30% is used productively. Conservatively estimated, the value of non productive assets across all PTNBHs could exceed hundreds of trillions of rupiah.
This is where we need to change our perspective: from merely managing assets to optimizing Return on Assets (ROA). Until now, university asset management has focused more on ownership administration than on economic productivity. Consequently, an important question arises: have we measured the contribution of every hectare of land, every building, and every laboratory to university revenue?
Meanwhile, the interest of potential partners is not the primary obstacle. Many investors and private companies are eager to collaborate with universities because academic reputation provides unique added value. The real challenge lies in the licensing procedures for State Owned Assets, which may take six to twelve months or even longer, involving processes from the rectorate to the Ministry of Finance.
This lengthy process creates a dilemma. Law Number 12 of 2012 grants universities autonomous legal entity status, representing a bold conceptual leap. However, state financial regulations continue to bind State Owned Assets with procedures that leave little room for flexibility. PTNBHs are mandated to generate their own income, yet they still lack full authority over their own assets. This situation is not the failure of any individual but rather a systemic gap that must be addressed promptly.
The solution is clear: delegate more proportionate authority to universities for utilizing assets below a certain value threshold. This would allow university business activities to move more quickly, enabling dormant assets to begin serving society.
Safe Harbor
Regulatory reform alone is insufficient as long as decision makers continue operating in an uncertain environment. Today, a Rector who approves a strategic commercial partnership risks legal scrutiny, even when the decision is made in good faith and under transparent governance.
The absence of a safe harbor policy has caused many promising projects to be abandoned before they even begin. Such a policy is not about granting legal immunity, but about ensuring that responsible innovation does not result in disproportionate legal consequences, provided that proper governance is observed.
Within universities themselves, significant untapped potential remains. Highly skilled lecturers, advanced laboratories, extensive experimental fields, and alumni networks constitute valuable assets that have yet to be organized as economic drivers. What is needed is not only top-down transformation but also an incentive system that empowers every organizational unit to innovate with confidence.
When a lecturer successfully commercializes research outcomes, tangible recognition should be incorporated into the academic career system, rather than being limited to a certificate. Likewise, if the effort does not succeed, it should still be recognized as a valuable contribution. A system that rewards only success breeds caution, whereas a system that also values courage fosters breakthroughs.
Building Partnerships Wisely
Partnerships with the private sector are often presented as the primary solution. However, hastily formed collaborations can become new burdens. This is because private companies focus on rapid returns, while universities operate within a much longer time horizon.
Therefore, the utilization of university assets must reconcile these differences to avoid risk asymmetry. The private sector should not be allowed to capture only short term incentives while universities are left bearing long term financial and reputational risks if projects fail.
To anticipate this, the prudent approach is to choose partnership schemes that match institutional maturity. At the initial stage, Build Operate-Transfer or Asset Utilization Cooperation schemes are generally safer. Through these arrangements, universities retain control over their assets, partners gain opportunities to conduct business, and revenue continues to flow without relinquishing ownership.
However, the most strategic partnerships do not always have to involve external private entities. A major breakthrough can begin even without regulatory changes through collaboration among PTNBHs. Universities that have already succeeded can share licenses and experience, while a platform for exchanging products and services among universities has the potential to establish a meaningful ecosystem and internal market.
All these efforts ultimately pursue one simple goal: granting universities greater freedom to fulfill their core mission. Financially independent universities can recruit outstanding researchers without waiting for state budget allocations, provide more scholarships without increasing UKT, and invest in research without being constrained by annual budget cycles.
Independence is not the ultimate goal, but rather a prerequisite for universities to serve as both intellectual and economic forces for the communities that have nurtured them. The transformation from cost centers into engines of growth is not a luxury but an inevitability that requires supportive regulations, a courageous culture, and genuine collaboration.
The opportunity has already emerged. Now is the time to move forward with measured steps and the confidence that Indonesian universities, particularly PTNBHs, deserve more than merely an unfinished journey toward independence.
Alim Setiawan Slamet
Rector of IPB University, Commercialization of Assets & Joint Venture Forum PTNBH (U25) Working Group
This article was published in Bisnis Indonesia, 26 June 2026. (IAAS/FHD)
