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Higher Education Review ProcessSetting Firm Foundations: Financing Australian Higher EducationforewordNo issue in relation to the future of Australian Higher Education attracts more controversy, nor is more important, than the model we choose for its financing. At one extreme are those who maintain universities should be entirely funded by government—Australian taxpayers. At the other are devotees of an unfettered free market. As always, the best interests of both the users of higher education and of their nation are somewhere in between. But whatever road we choose, the status quo cannot be considered to be a responsible option—although it may be the most attractive for veterans of university reform. Australia’s thirty-eight publicly funded universities are different. Vice Chancellors proudly boast the achievements and aspirations of their own institution. Some have a large research base, others focus on more defined fields whilst meeting the economic and social demands placed upon them by the regions in which they are based. While many universities find non-government sources of funding relatively easy to attract, others do not. Yet the policy and funding framework applying to each institution is essentially the same. This is neither a sensible nor appropriate foundation for building a world class Australian university sector for the twenty-first century. This paper sets out for consideration and public debate, four models for reform. None is preferred by the Government, nor is any without advantages or disadvantages. None should be seen in isolation from other key policy challenges before us covered in the other discussion papers. But whatever we do, we must ensure that any reform adheres to a number of key principles and realities. A return to the days of full public funding of Australian universities will not occur. This would require a further $4 billion annually of Commonwealth funding. Similarly, neither the Australian people nor its government will accept an unregulated ‘free market’ for higher education. But there is general support for student contributions based on income contingent loans provided by government appropriate to the cost of course provision and reasonable employment and income expectations of graduates. Any funding model proposed should be seen in the context of broader policy reforms covering specialisation, regional engagement, governance, private sector investment and increased access for students from lower income backgrounds including rural and Indigenous Australians. Proponents of models of deregulation need especially to recognise the need to both identify and financially support the onerous and increasingly complex community service obligations faced by universities and campuses in the regions. No reform can responsibly undermine regional universities. Nor can Australia countenance ‘unshackling’ larger universities at the expense of their smaller counterparts. It should be remembered in all this that 75% of the cost of a university course is met by Australian taxpayers—many of whom have not ever seen the inside of a university, but hope that their children and grandchildren might. Their views and the competing funding priorities facing government are not to be trivialised or dismissed. Outside the Queensland University of Technology, I asked a woman unconnected with it what she thought of universities. She reflected for a moment and replied, “I don’t know. I applied to go to one once and didn’t get in. But if you’re going in there you can tell them this for me. I work hard and my taxes help pay for what goes on in there. But when they come out and apply for the same job as me, they’ll get the job.” Reform of Australian universities is critically important to our economic, social and cultural development. As such it is vital we get this right and arrive at a policy formulation informed by careful and mature debate. But under no circumstances should the public resources provided by hard working everyday Australians be demanded of them without confidence that they are being invested in a sector that is academically, managerially and financially efficient.
The Honourable Brendan Nelson MP
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Any comments or
queries should be sent to:
highered@dest.gov.au
Department of Education, Science and Training
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