Australian universities ‘better off if legislation fails’

Fee and subsidy overhaul will not solve anything, policy guru says, as government reforms go under the microscope

September 3, 2020
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As Australia’s government meets a speed bump in legislating its university funding reforms, a top analyst and former Canberra insider says universities will be no worse off if the reform push fails.

Andrew Norton, professor in the practice of higher education policy at the Australian National University, says the government’s “Job-ready Graduates” proposals offer universities little that they do not already have. “Overall, I think the…package will cause many more problems than it will solve over the next few years,” he blogs.

“Muddling through with the current system, while encouraging the government to try again with a simpler, fairer and more coherent policy proposal, is the better option.”

The package has stalled in the Senate after winning approval from the House of Representatives on 1 September. The government acceded to opposition and cross-bench MPs’ wishes in referring the bill for an inquiry by the Senate’s Education and Employment Committee.

The group is due to report by 25 September, giving it just three weeks to review the complex proposals. But this compares favourably to the six days universities and sector representatives were given to provide feedback on an exposure draft of the legislation.

Greens education spokeswoman Mehreen Faruqi, who had unsuccessfully led an earlier push to refer the bill to the Senate committee, said that more scrutiny was warranted. “It’s critical that the senate hear from universities and everyone who is impacted by this…legislation,” she said.

“An inquiry will help take this…bill apart so we can block it once and for all in October.”

The government says that the reforms will create 100,000 additional university places by 2030. Universities desperately need extra capacity to cater for a looming bulge in high school graduate numbers and a spike in demand fuelled by the coronavirus-induced recession.

But Professor Norton says that the increased capacity would be illusory. “Any growth in commonwealth-funded student places would not be driven by increased Commonwealth Grant Scheme funding, but instead by lower average funding rates,” he writes.

“At a system level I don’t believe that direct commonwealth funding will increase student places in the coming years, beyond what could be delivered under status quo policies.”

He says that the proposals offer increased cash flows over the next two years followed by two years of cuts. This would not be an improvement on the “status quo”, with current funding levels already “legally protected”.

The short-term increases were “transitional funding” to compensate for reductions in teaching grants affecting both current and future students. Consequently, if the reforms were not enacted, universities would have no need of the transitional funding.

But if the reform push succeeded, universities would face “huge additional complexity and uncertainty” – including the need to administer new funds, cope with more complicated fee and subsidy hierarchies and perform “much more compliance work” around student admission and retention rates – for no net gain.

The package’s rejection would leave universities with the choice of admitting some unsubsidised students or denying them places. But Professor Norton says that was already happening anyway, and was likely to continue.

“I believe that the minister sincerely wants to deliver extra places, but nothing in the legislation guarantees that this will happen,” he says.

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