Job-ready Graduates scheme ‘saving Canberra close to A$1bn’

Australia’s government is saving itself close to a billion dollars a year by perpetuating the Job-ready Graduates (JRG) scheme it insists has “failed”, analysis suggests.

Modelling by the Innovative Research Universities (IRU) has found that students outlaid up to A$368 million (£196 million) more in tuition fees in 2024 than they would have paid under the contribution rates that JRG replaced.

Meanwhile, universities received up to A$813 million less than they would have pocketed in federal government teaching grants if the pre-existing subsidy arrangements had not ended with JRG’s 2021 introduction as a Covid-19 funding measure.

The figures, adjusted for inflation, provide a fiscal backdrop to a slump in participation which the IRU says has been partly driven by JRG and disproportionately affected disadvantaged students.

The analysis found that while domestic take-up of bachelor’s degrees had declined by 3.5 per cent between 2020 and 2024, commencements among the most socio-economically deprived quartile of the population plunged by 9.8 per cent over the same period.

This had reduced disadvantaged students’ share of new undergraduate places from 16.8 per cent in 2020 to 15.7 per cent in 2024, the IRU calculated.

And while disadvantaged students’ commencements had risen by 2.1 per cent in the fields with the lowest fees, including education, nursing and languages, they had plunged 19.7 per cent across high-charging areas like the humanities, social sciences, commerce and law.

IRU chair George Williams said Australia was “going backwards” on equity despite the Universities Accord’s focus on boosting participation among “currently under-represented” groups.

“We need students from all backgrounds free to pursue their passions and enter the workforce in the widest range of fields,” Williams said. “Pricing some students out of degrees at the point of entry undermines not only their future but also Australia’s future.”

University lobbyists have become increasingly despondent at the persistence of JRG arrangements that have now been in place for longer under Labor than the conservative government that introduced the scheme.

Education minister Jason Clare acknowledged the Universities Accord’s recommendation that JRG needed “urgent remediation”, but refused to put a timeline on reform. “There’s no doubt there’s more work to do and we’ll keep working through the recommendations,” Clare told Radio National. “Talk to a lot of students, they’ll talk to you not only about the cost of the degree, but the cost of living while they’re studying for their degree.”

Clare’s former cabinet colleague Bill Shorten, now vice-chancellor of IRU member the University of Canberra, said Australia was leaning much too heavily on students to bankroll its higher education system.

“We hamper the future of our young not just by the fact that they cannot afford a house, but even that a modest education has become more expensive,” Shorten told the National Press Club. “We are trapping our young in a vicious cycle that weakens intergenerational equity.”

He said the “original premise” of Australia’s income-contingent student loans system – that graduates received “lifetime advantages” in return for a moderate contribution towards the costs of their study – had been erased by JRG.

“It has not had the desired effect of pushing students at scale towards the sciences where enrolments have dropped anyway,” Shorten said. “Students wanting to study the arts are still doing so, just paying horrendously more.”

Educational insiders are worried that the government may sidestep the imperative for JRG reform by mandating the development of a national credit recognition framework, whereby vocational education graduates will be teleported straight into the second year of university degrees – thus saving themselves a year’s tuition fees.

Consultant Clare Field said these arrangements came at “considerable cost” to universities, which forfeited around one-third of their revenue when they granted students advanced standing.

“Relying on institutional goodwill alone will not deliver the scale of change needed across the system to achieve the accord’s target,” Field blogged.

john.ross@timeshighereducation.com