The Australian Government plans to encourage foreign universities to open alongside the nation's state universities by allowing home students who enrol to take out government loans.
Brendan Nelson, Education Minister, told a conference in Melbourne last week that he backed plans by the South Australian Government to allow the US Carnegie Mellon University to establish a campus in Adelaide.
"Carnegie Mellon is, by any reasonable standards, a world-class university," Dr Nelson said. "I will be doing everything I can to see that it is able to establish facilities in South Australia."
Although the Federal Government would not provide subsidies for Carnegie Mellon or any international university that wanted to establish a base in Australia, students would be able to take out federal loans if they enrolled in such institutions, he said.
The so-called fee-help scheme operates on the same basis as the Higher Education Contribution Scheme. Students would be able to repay loans via a tax surcharge after they graduated and were earning at least A$35,000 (Pounds 15,000) a year. Students can borrow up to A$50,000 towards the cost of a degree but this sum is likely to be increased to take account of high-cost degrees such as medicine.
More than 40 private colleges and institutes have applied to become "approved higher education providers" so that their students can access the fee-help scheme. At least 30 have been successful and, as well as their students accessing loans on a deferred payment basis, some may also be awarded "national priority places" in fields such as nursing, for which the Government subsidises course costs.
In setting out the Government's priorities for 2005, Dr Nelson said the two key issues were establishing a research quality framework and a review of the national protocols governing university status.
Sir Gareth Roberts, who reviewed science and engineering skills in the UK, is chairing a committee investigating models for a quality framework whereby only research rated "high quality" would receive government grants.
Dr Nelson said that while research quality was at the top of his agenda, it was also time to look at how the term "university" was defined.
"I ask why there are 14 Australian universities that run teaching-only campuses with staff employed on contracts, that have limited resources, and why other institutions that provide extremely high-quality teaching should be denied access to the title 'university'," he said.
The teaching at some education providers was at least as good, and perhaps better, than others classed as universities - yet they were not allowed to use that title.
Dr Nelson said he envisaged a time when universities ceased "trying to be all things to all people and chose unashamedly" to concentrate on teaching or on a limited number of research areas.
He said that just over half of Australian academics published research papers and only a quarter brought in research money. "One of my other agendas is to see that performance in teaching is at least as highly regarded as research output in terms of promotion," he said.