Australia's education sector must do more to make the grade

The Business Council of Australia has issued some recommended improvements to the governance of higher education, including a better focus on outputs. For example, Australia ranks highest in the Organisation for Economic Co-operation and Development in terms of the number of higher education researchers per head of population, but the outputs in terms of academic publications and commercialisation are below the average.

Australian universities provide courses to 20 per cent of the population, which compares very favourably with other OECD countries. During the past decade, they led the building of a $4 billion export business in educating overseas students.

While this sounds impressive, community needs are changing and, unfortunately, the underlying statistics on performance are not so flattering for Australian universities. In the recent Good University Guide survey on graduate satisfaction, students ranked the teaching quality in information technology and business "one" and "two" out of five respectively (five being the highest rank).

In addition, the Vice-Chancellor of Melbourne University said in a speech this year that he believed no Australian university would rank in the world's top 100.

Good governance is about accountability, transparency and effectiveness. Speaking at a forum in 2000, Michael Gallagher, the Department of Education's then first assistant secretary, higher education division, said the relative freedom that Australian universities had in the design of degrees and the remuneration of academics was much greater than other countries, including Britain and the United States, so the community had a right to expect good performance and transparency on these issues.

During the past decade, universities increased spending on non-teaching overheads by 105 per cent, while money spent on teaching and research staff rose by only 38 per cent. According to a recent article in The Economist, Australian academics are the third-highest paid in the world, following significant increases in the past 10 years. In the same period, class sizes grew from 15 to 19, so the higher overheads and salaries were achieved while teaching conditions declined.

If good governance is the key to better scholarship, rather than state or Federal Government intervention, then what issues should university councils (which are responsible for governance) be addressing?

In 1995, the Hoare report into better management at universities recommended four key areas to be covered for good governance:

1. Reporting on roles and responsibilities.
2. External accountability and reporting.
3. Good strategic planning.
4. Performance monitoring.

While some universities have tried to implement these recommendations, research conducted by the Australian National University in 2001 found that less than one in three had a plan to report on these four elements. It would seem there are several areas that need to be addressed to achieve good governance:

Universities need to acknowledge they are accountable to the community for their activities and performance, and that without that commitment, community and resource support will decline.

University councils, which may sometimes comprise more than 25 people, need to be run by only about 15 people, with the majority of members being external appointees.