Joy greets gold rush Down Under

Labor's inaugural budget offers A$500m windfall to help 'rebuild' Australian sector. John Gill writes

May 29, 2008

An injection of hundreds of millions of dollars to overhaul outdated and inadequate university infrastructure has been announced in Australia.

The one-off sum of A$500 million (£242 million) was awarded this month in the Labor Government's first budget. It was billed as a fund to "rebuild campuses after 11 years of neglect".

The funds were an unexpected windfall, and the move is seen as an early dividend of a much-expanded public endowment that has been set aside to support the sector.

The Government said it would add A$5 billion to the existing Higher Education Endowment Fund to create a new Education Investment Fund (EIF) worth A$11 billion.

The A$500 million, which is to be made available immediately to improve student amenities, libraries, laboratories and lecture halls, has won an enthusiastic response.

Margaret Gardner, vice-chancellor of RMIT University (formerly the Royal Melbourne Institute of Technology), told The Australian newspaper: "We are unlikely to see vice-chancellors dancing in the streets - that would be too scary - but we'll be dancing privately in our offices and lounge rooms."

However, this delight was tempered by concern in some quarters that a disproportionate amount of the money would go to the country's large, research-intensive institutions.

Greg Hill, vice-chancellor of the University of the Sunshine Coast in Queensland, said the $2.3 million his institution received compared unfavourably with $35.2 million given to the University of Sydney.

The cash was allocated through a formula that linked 70 per cent of funding to domestic student numbers and 30 per cent to research grants, but Professor Hill said that smaller institutions would be able to make better use of the money.

The decision to almost double the higher education endowment with the creation of the EIF also raised questions from the sector.

While the new fund is far larger, and the Government has scrapped an annual cap that limited spending to the previous fund's income from interest, the range of potential recipients has also expanded to include research organisations and vocational education and training institutions.

Ian Young, vice-chancellor of Swinburne University of Technology, said: "There's a real risk that funds will be spread too thinly."

A universities lobby group has called on the Government to guarantee that higher education will end up with at least the A$6 billion originally promised in the HEEF.

Whatever the outcome, they can bank on receiving the A$304 million allocated in the first round of grants next year, prior to the transition to the new EIF system.

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