Recent news reports inform us that the Minister for Education, Science
and Training, Dr Brendan Nelson, has had his long-awaited package of
higher-education reforms approved, in general terms, by Cabinet. While
there is still some final tinkering to be done and no one seems to know
exactly what is in the package, rumours are rife about the potential
impact on students, academics and other stakeholders. We await the detail
with a mixture of excitement and anxiety because these policy and funding
decisions will have far-reaching consequences for the future of all
Australians. Without a strong culture of education, research and
innovation we will jeopardise our international competitiveness.
In our submission to the Government's Crossroads
review of higher education, the Group of Eight put forward proposals aimed
at delivering a tertiary education system capable of playing a leading
role in the nation's economic development and its engagement with the
If there was ever any question of the economic impact that the
education and research conducted in universities can have, one need only
consider the results of the BankBoston
Economics Department's 1997 study of the economic and job impact of
the teaching and research conducted by the Massachusetts Institute of
The study, the first of its kind, found that if the companies founded
on MIT graduates and faculty formed an independent nation, the revenues
produced would make it the 24th largest economy in the world. The 4000
MIT-related companies employed 1.1 million people and had annual revenues
which equated to a GDP of $116 billion. This was only slightly below the
then GDP of South Africa and above that of Thailand.
The Blair Labour Government's White Paper: The
future of higher education promises a six per cent real increase
in public funding for Britain's universities for each of the next three
years. Under the proposal, public funding for university research alone
will increase by £1.25 billion or 30 per cent in real terms per year
($A3.36 billion) by 2005-2006.
The British funding increases will be accompanied by the introduction
of a HECS-type loan system, and universities will be given the freedom to
charge undergraduate course fees within certain limits. In committing to
these reforms and more, the British Labour government has recognised the
critical link between Britain's future economic and social wellbeing and
harnessing the talents of its people.
Shortly after the release of the British White Paper, Australia's
Productivity Commission released a report: University
Resourcing: Australia in an International Context which confirms
what anyone who studies or works in the sector already knows - without
substantial reform and extra government support, Australia's university
system risks being left behind those of comparable countries.
While the Commission found Australia's performance on a range of
criteria mixed, it confirmed that total public and private spending on
higher education in Australia as a percentage of GDP has declined
dramatically since 1995, that student-teacher ratios have increased from
around 14 students per teacher in 1993 to almost 20 students per teacher
in 2001 and that 59 per cent of Australians are now expected to enter
higher education at some point during their lives.
What the Commission failed to do, however, was quantify what these
changes actually mean for students, their teachers and the wider
community, or to adequately examine the amount and quality of research and
development activity in our universities. New technologies and changed
work practices have delivered some efficiencies that could expect to see a
reduction in the proportion of staff to students but we have now reached a
point where the quality of the student education experience is affected.
While the past 10 years have seen a dramatic rise in the number of
Australians wanting to access higher education, budgetary pressures have
forced universities to cut staff resources and infrastructure developments
and to increase sources of non-government funding. Many university budgets
are now being supplemented by revenue received from full-fee paying
domestic and overseas students as well as from the commercialisation of
research and consulting activities. This is being done against a backdrop
of high levels of government regulation. A sustainable university system,
especially one that fosters excellence in teaching and research, requires
policy settings and funding support that recognises and rewards strengths
while also granting sufficient autonomy to the individual universities.
The resulting diversity within the university sector will enhance the
teaching and learning experience.
The government has made much of the point that the threats of war and
terrorism, the cost of the drought and global economic uncertainties mean
there will be little if any new money in the budget for higher education,
at least in the short term. However, The Group of Eight remains hopeful
the package recognises that for Australia to meet challenges such as these
into the future, and to have any chance of ensuring a prosperous economy,
Australia needs a world-class university sector, one able to generate
innovative ideas and produce highly skilled graduates.
The Group of Eight proposal recognised the reality that Australia's
university sector today is vastly different from that of 20 or even 10
years ago. Like the British White Paper, it recommended that universities
receive additional funding per student place, but also be able to vary
fees. Funding for research would focus on areas of strength and
performance. Resources meant for teaching would not have to be diverted to
fund research and greater investment by industry in R&D would be
encouraged through incentives.
Our proposal was based on the view that a healthy university research
capacity, capable of achieving the results of an MIT can only be built on
a platform whereby universities have adequate resources to discharge their
teaching and general operations. Without adequate staff and infrastructure
Australian universities cannot hope to match the standards realised in
overseas institutions - nor produce the benefits that flow to the
Overall, the system the Group of Eight envisages would be characterised
by improved resource levels, improved outcomes from both teaching and
research and thereby improved returns to the nation. The essential
elements to achieve these outcomes are an adequate rate of public funding
per student and greater freedom for universities to set the price for the
courses they teach. It is the Group of Eight's strong view that the
long-term solution does not lie in simply throwing more money at
universities but in giving them more freedom in the way they generate
income and provide their services.
The release by the British Government of its vision for the future of
its higher education system, our own reports produced during the
Crossroads review and the Productivity Commission research exercise, put
the case for the need for reform beyond question. The stakes involved for
the nation are simply too high to ignore the warning signs. A balanced and
considered package of reforms is needed. On budget night we will know if
the Government has got the mix right.