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Australian Universities Demand Increased Funding as Student Costs Surge

Australian universities are urging the Albanese government to provide more flexible funding arrangements as the current model can no longer keep pace with the evolving needs of students, according to an education lobby group.

According to Universities Australia’s analysis, coverage of the operating expenses of universities by the Australian government—excluding HECS-HELP—declined over the years from 2009 to 2019.

The analysis showed that while total expenses from continuing operations per enrolled student rose by 35 percent to $23,371 from $17,358 during the decade, relevant government funding for universities grew by only two percent to $8,176 from $8,025 over the period.

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“Substantial and sustainable government investment in university activities is needed to meet current and future needs of the nation. We can’t continue doing more with less.”

UA is seeking to have an established new funding model to support the ongoing operation of universities through partnership agreements, improved connectivity between higher and vocational education, and a National Lifelong Learning Strategy between government, industry, and unions.

It is also calling on the government to adjust policy to facilitate better access to compulsory work placements and more funding for research and teaching.

“A combination of funding certainty and flexibility is needed so that universities can best serve their communities as well as their strengths,” Ms. Jackson said.

5 Priorities Identified in the Universities Accord Interim Report

The interim report identified five priorities to address, including the creation of more Regional University Centres (RUCs) to extend visible local access to tertiary education.

The report also said the removal of the 50 percent pass rate requirement due to its poor equity impacts while calling for more reporting on student progress.

Other priorities identified were the extension of demand-driven funding to metropolitan Indigenous students; the extension of the Higher Education Continuity Guarantee into 2024 and 2025; and immediate engagement with state and territory governments and universities to improve governance.

The interim report has been welcomed by universities.

“The current tertiary education system has delivered many achievements to be proud of, but it is not set up to ensure that Australia has the system it needs for the next few decades,” Duncan Maskell, vice chancellor at the University of Melbourne, said.

“Australia needs to invest in a sustainable research system that delivers productivity, resilience, and prosperity to the nation, and that will position Australia at the leading edge of global knowledge creation.”

The Group of Eight (Go8), comprised of Australia’s leading research-intensive universities, flagged the need for an immediate and renewed focus on research funding reform.

“While the Universities Accord Interim report has rightly addressed participation, access, and equity, there must be an equal focus on long-term funding of the sector, including on research. This is the missing piece,” Go8 CEO Vicki Thomson said.

“The interim report has not addressed the core underlying problem in our higher education sector—that is the distorted funding model we have in this nation whereby the national university research effort is underwritten by international fee income.”

The interim report has called for a levy to be imposed on international students (on top of existing high fees) to fund national and sector priorities such as infrastructure and research—an idea Go8 expressed opposition to.

“This redistributive tax would create countless unintended consequences, damage our higher education sector and international reputation. We must ensure that this process does not undermine our nation’s hard-won and enduring success in international education and damage Australia’s largest services-based export industry,” Ms. Thomson said.

Meanwhile, the interim report also said that while the demand for quality Australian labour has continued to increase, the number of qualified people has been decreasing.

“Trends in first-time completions of bachelor degrees have been decreasing since 2018, with 2021 completions at their lowest since 2014,” the report said.

“Concerningly, demand for higher education is falling–which will lead to even fewer graduations a few years from now. Australia’s declining skills trends must be reversed. A sense of urgency is needed.”

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