Department of Education Employment and Workplace Relations
Abstract
This report defines enduring principles to underpin the long-term funding of Australian higher education as well as specific recommendations and options for a reformed funding model.
Australia’s future social and economic development depends on having an educated and highly skilled community, delivering creativity, innovation and improved productivity. Australian universities contribute to society by leading public debate, enhancing civic and cultural life and enriching our self-awareness by the expansion of knowledge. In addition, universities contribute to the economy by supporting the development of effective graduates, driving regional economies and improving the national accounts by virtue of their research and development as well as their onshore and offshore education activities. Their regional success and global impact enhances our national standing and assists in globalising the national economy.
An effective and highly performing university sector is essential to achieving these goals and base funding to universities from the Australian Government and student contributions provides the largest source of revenue to universities.
Australian universities are institutions with highly complex goals and operations. They demonstrate strong international links but are also responsive to national and regional priorities. The sector is diverse but needs to operate in a legislatively controlled framework; it must focus on excellence yet also have a wide reach. Australian universities are accountable to Government but receive much of their funding from non-government sources and are autonomous institutions.
To ensure they contribute to innovation, productivity and a civil society, our universities undertake teaching that is informed by scholarship, as well as research which is collaborative and global in its significance and often capable of commercialisation.
The evidence available to the Higher Education Base Funding Review Panel (the Panel) showed that the Australian university sector was well managed and had adapted to changing circumstances to become more efficient and productive, such that it is now able to use any additional funding effectively. The trust of the community and government investment over many decades has been and continues to be justified. Australia’s higher education system has been responsive to government initiatives and has diversified its income sources. The diverse system includes areas of research excellence, high-quality and innovative teaching, and a widespread focus on equity. Our national system is well regarded at home, respected internationally and a source of national pride. Nevertheless, specific local issues, changing policy settings and rapid global changes have the potential to pose significant risks to the quality and effectiveness of Australian universities.
The Government has acted swiftly in response to the Knight Review of the Student Visa Program to support international enrolments in universities. However, the Panel noted ongoing concern in the sector about the potential for emerging international issues to erode Australia’s competitive advantage in the international higher education market. There are pressures on operating costs and infrastructure, reflecting the dramatic changes in the sector over the last two decades; a period marked by far more than just expansion. Across the sector the stresses were seen to be largely similar, reflecting changes in student and employer expectations, technological change, teaching reforms including online delivery and an increasing emphasis on work-integrated learning.
Put simply, despite productivity gains and allowing for institutional decisions about priorities, the costs have not just risen, but also the nature of the institutions has changed during the decades on either side of the millennium
