IRU Pre-budget 2017-8 submission

This 2017-18 pre-budget submission sets out the IRU’s recommendations for reworking the Government’s higher education reform package and the next stages needed to ensure effective research outcomes across Australia.

Without adequate funding however, universities will struggle to continue delivering the excellence in teaching and learning and research.  This excellence is underpinned by adequate and world-class research infrastructure.  As various reports and reviews have shown, it pays for governments to invest in higher education and research.

The points summarised below are detailed in the IRU’s response to the Government’s discussion paper outlined Driving Innovation, Fairness and Excellence in Australian Higher Education’ and the IRU input to the development of the National Research Infrastructure Roadmap.

The IRU’s central objectives for the medium term

  1. Retain demand driven funding as the core mechanism for supporting Australians gain the higher education they need, expanding it to include sub-degree enrolments.
  2. Ensure base university revenue is at a level which is sufficient to sustain universities’ core capabilities to deliver student learning outcomes and research to meet future needs
  3. Allow universities to opt in to changes with long term significance, testing out changes and encouraging incremental take up.

Key Recommendations

  1. A commitment to support each Australian achieve their potential with an initial expansion of sub-degree places, targeting regions of under attainment.
  2. Incorporating an effective Higher Education Participation and Partnerships (HEPPP) program into the Commonwealth Grant Scheme (CGS) with sufficient funding that it encourages universities to focus on enrolling students from all backgrounds and rewards those who do so best.
  3. Targeted support for universities with outer metropolitan and regional bases to support the effective Australia-wide access to university education and research.
  4. Reworking of the Commonwealth Grant Scheme (CGS) and student payments.
  5. Adjust HELP repayment arrangements in ways that speed up repayment but which do not affect the core elements of HECS-HELP.
  6. Committing to long-term funding for research infrastructure across Australia through the establishment of a national research infrastructure fund.
  7. Continue to strengthen incentives for industry driven research.

Read the full submission below.

Long-term funding is the missing piece of the Research Infrastructure puzzle: IRU’s response to the 2016 Draft National Research Infrastructure Roadmap

The 2016 National Research Infrastructure Roadmap identifies the priority research infrastructure for the coming decade in nine focus areas that will underpin research in which Australia excels. This should deliver long-term national benefit and foster strategic international partnerships for Australia.
IRU supports the Draft Roadmap’s nine overarching recommendations and the nine identified national research infrastructure focus areas. Two issues remain.
1. Long-term funding is the missing piece of the Research Infrastructure puzzle. For this Roadmap exercise to be meaningful, the Government must resolve the funding issue. The $3.7 billion from the Education Investment Fund (EIF) should be part of the equation.

2. Hosting for world-class research infrastructure should intentionally be spread across Australia.

An abridged version of the document below was submitted by the IRU to the consultation on the 2016 Research Infrastructure Roadmap.

Indigenous Student Success Program: designing to improve outcomes

IRU supports the aim of the new Indigenous Student Success Program (ISSP) to raise outcomes for Aboriginal and Torres Strait Islander students through integration, simplification and better use of three current programs.  We are very concerned that the draft Guidelines do not support the latter two of those aims.

There is no sense of simplicity or flexibility that would support the aim of a performance focussed program encouraging universities to improve Aboriginal and Torres Strait Islander student outcomes. The performance basis integral to the new program, whereby university funding is dependent on their success in enrolling Aboriginal and Torres Strait Islander students and supporting then through to completion, is buried within extensive rules about how funds can or cannot be used. The ISSP Guidelines are more prescriptive than any other under the Higher Education Support Act.

Read IRU feedback in full below.

Impact of the TEQSA Act on the higher education Sector: IRU submission

The IRU considers that the Tertiary Education Quality and Standards Agency Act 2011 has worked effectively since the 2014 amendments to the Act as the legal basis for Tertiary Education Quality and Standards Agency (TEQSA) and the Higher Education Standards Panel.

The area for improvement to legislation is to streamline the Education Services for Overseas Students (ESOS) Act and the supporting National Code to remove duplication of the Higher Education National Standards and to make registration of courses for international students an administrative listing not a distinct legal decision.

The 2014 amendments followed concerns that the initial operations of TEQSA were not consistent with the principles set out in part 2 of the Act of regulatory necessity, reflecting risk, and proportionate regulation.  The amendments were in response to the Lee Dow and Braithwaite Review of higher education regulation which strongly argued the importance of an effective partnership among the relevant bodies – providers and quality agency – for a quality assurance system to work well in practice.

That requires a constructive tension across:

  • higher education providers, notably universities, which are responsible for determining how to provide higher education to students, with a strong future focus for how higher education should be delivered to meet prospective needs;
  • the Higher Education Standards, which attempt to define the key threshold requirements for good higher education without dictating in detail how it should be delivered.  The Standards inevitably have a current day feel; and
  • TEQSA, charged with using the Standards as the guidance marker to test whether higher education providers are living up to their responsibility, in which it should both avoid constraining new developments of value and be effective in acting where delivery is clearly not effective.

The following sections consider the six questions the Discussion Paper asks. Read full submission below.

IRU Response to the Panel’s Research and Development Tax Review

The Review Panel, chaired by Mr Bill Ferris AC (Innovation Australia), Dr Alan Finkel AO (Chief Scientist) and Mr John Fraser (Secretary to the Treasury) was asked to identify opportunities to improve the effectiveness and integrity of the programme, including how its focus could be sharpened to encourage additional R&D. The Panel’s overall assessment is that the programme “falls short of meeting its stated objectives of additionality and spillovers” and that the programme could be “better targeted”.

In general the Panel’s report is in line with the IRU recommendations (below) to improve the incentives for industry to work with publicly-funded research organisations and to simplify the administration of the tax incentive. As expected, the Panel does not make a specific recommendation to include research in social sciences, arts and humanities (currently excluded) in the list of eligible activities. The Panel comes to the conclusion that it is too soon after the programme’s introduction to change the definition of eligible activities and expenses under the law.

The Panel makes six key recommendations: 

  1. Retain the current definition of eligible activities and expenses under the law, but develop new guidance, including plain English summaries, case studies and public rulings, to give greater clarity to the scope of eligible activities and expenses (Section 4.1, p. 30).
  1. Introduce a collaboration premium of up to 20 percent for the non-refundable tax offset to provide additional support for the collaborative element of R&D expenditures undertaken with publicly-funded research organisations. The premium would also apply to the cost of employing new STEM PhD or equivalent graduates in their first three years of employment. If an R&D intensity threshold is introduced (see Recommendation 4), companies falling below the threshold should still be able to access both elements of the collaboration premium (Section 4.2, p.  35).This is line with the IRU’s recommendation for strengthening the incentive for Research and Development carried out through publicly-funded research bodies 
  1. Introduce a cap in the order of $2 million on the annual cash refund payable under the R&D Tax Incentive, with remaining offsets to be treated as a non-refundable tax offset carried forward for use against future taxable income (Section 4.3, p. 37).
  1. Introduce an intensity threshold in the order of 1 to 2 percent for recipients of the non-refundable component of the R&D Tax Incentive, such that only R&D expenditure in excess of the threshold attracts a benefit (Section 4.4, p. 39).
  1. If an R&D intensity threshold is introduced, increase the expenditure threshold to $200 million so that large R&D-intensive companies retain an incentive to increase R&D in Australia (Section 4.4, p. 41).
  1. That the Government investigate options for improving the administration of the R&D Tax Incentive (e.g. adopting a single application process; developing a single programme database; reviewing the two-agency delivery model; and streamlining compliance review and findings processes) and additional resourcing that may be required to implement such enhancements. To improve transparency, the Government should also publish the names of companies claiming the R&D Tax Incentive and the amounts of R&D expenditure claimed (Sections 5.1-5.5, p. 45).This is in line with the IRU’s recommendation for an efficient user-friendly application process.

Further information can be obtained here:

Read the full IRU response below.

VET Student Loans Bill 2016: Higher education implications

The decision to separate the VET loans away from higher education loans reduces the habitual confusion of VET specific issues into higher education debates.  For instance, a significant aspect to the Parliamentary Budget Office’s exaggerated assessment of the long term cost of the Higher Education Loans Program was the impact of the rapid escalation in VET FEE-HELP (see Three-problems: IRU comment on PBO).

The VET Student Loans Bill 2016 and the associated support bills set up a new loan scheme, with rules to contain bad practice among some providers under VET FEE-HELP.  In particular, there are prohibitions about using the loan to induce people into a course and arrangements to recover from providers a loan contrary to the intentions of the scheme.

For Innovative Research Universities (IRU), the interest in the Bills lies in the potential incentives for education providers that operate in both vocational and higher education and the potential for any of the rules introduced for vocational education to be carried over into higher education.

Provider incentives

The action to contain the operation of low quality providers seeking to use the current VET FEE-HELP arrangements to maximize profits while providing little or no training to enrolled students also has implications for the legitimate providers.

The cap on loan amounts and potentially on fees may encourage providers to consider whether a similar course adapted to secure accreditation as higher education qualification such as a diploma or advanced diploma would be a better option in the future.  The advantage would be that the provider could set a charge at the level they deem suitable for the course.  If accredited through the Tertiary Education Quality and Standards Agency (TEQSA) and then approved for access to FEE-HELP there may be some shifting of loans from one scheme to another.

Higher Education accreditation is a more complex and time consuming process than in VET hence we are not arguing there would be a major new avenue for exploitation.  However, the potential for the shift does need to be recognized.

Constraints on marketing

It is essential to prevent the abuses where some VET providers used VET FEE-HELP as a means to get individuals to sign up for courses they would not complete.  It is also important that in doing so legitimate encouragement of Australians to consider their education and training needs not be suppressed and that competitive marketing of the advantages of a provider not be prevented.

Universities seek to attract potential students to enroll.  It is a natural part of ensuring that every Australian considers their education needs to gain suitable education and training following school.  In doing so, universities provide information to potential students, promote the potential for university education in schools and other arenas and use third parties in doing so.

The provisions of the VET Student Loans Bill 2016 are carefully drafted to focus on preventing providers attract enrolments through use of the potential for a loan.  Assuming they come into effect, their impact on legitimate VET providers should be monitored and the implications for all good providers in either sector considered.  Our initial assessment is they appear targeted to the purpose with minimal impact on good marketing practice.

IRU submission: 2016 National Research Infrastructure Roadmap

High quality and accessible Research Infrastructure: IRU submission to 2016 National Research Infrastructure Roadmap

To maximise its investment in Australia’s research system, the government needs to commit to long term investment in research infrastructure that is accessible to all researchers and potential end users.  The requirement for national access is usually interpreted as ensuring that researchers outside the main cities can access resources, but it equally means that a resource could be located anywhere capable of supporting it, with those in major city areas as able as anyone to access resources remotely.

Some resources have a natural home but most resources have no intrinsical locational logic.  These can be used to stimulate the whole Australian research system through a distributive intent, with resulting benefits for regions and potential reduction of pressure on major population centres.

IRU’s mapping of the spread of Australia’s currently-funded research infrastructure shows that almost 80% is located in cities and inner cities.

Geographical spread should be a key factor in determining the priorities in the 2016 National Research Infrastructure Roadmap.

Read the IRU’s submission to the 2016 National Research Infrastructure Roadmap. 

Read the Read the IRU’s analysis of the spread of currently-funded NCRIS projects.  

Access the IRU NCRIS mapping database. 

Improving equity in higher education participation – IRU response to HEPP evaluation

Without a constructive Government response to the evaluation, the next round of HEPPP cuts risks undermining a program critical for educating all students well. It is essential that the long-term program, sustains the incentive to enrol all suitable students regardless of background.

Hence a funding stream tied to enrolments of low SES students and other underrepresented groups remains a core need of an effective higher education funding system.

Based on the original proposal for HEPPP and redressing the history of its implementation the future scheme should involve:

  1. inclusion of a significant loading in the Commonwealth Grant Scheme (CGS) addressing student background, to reward enrolment of a diverse student population broadly matching that of Australia;
  2. maintenance of an effective HEPPP program targeting the development of interest in higher education among communities and individuals less likely to aspire to university and support for their educational development; and
  3. sensible reporting and acquittal arrangements that do not hamper the constructive delivery of student supports.

Read the full response below.

Structural Review of NHMRC’s Grant Program: IRU Submission

The restructure of Australia’s health and medical research grants must retain the focus on supporting optimal research leading to the best possible health and medical outcomes for all Australians .

The individual submissions of IRU member universities provide a detailed assessment of NHMRC’s proposed three models.  While raising a number of interesting options, our conclusion is that a better model is needed such as the Griffith model four that is structured to achieve the desired health outcomes rather than the desired outcomes for medical research careers.

IRU supports the approach of restricting the number of grants held by Chief Investigators but argues that this is not yet suitable for Indigenous health research and that it creates issues for researchers from enabling disciplines.

Read the IRU submission downloadable here.

Read the IRU members’ submissions here: Griffith University, (model 4), Flinders University, La Trobe University and CDU.

TEQSA’s proposed External Reporting program: IRU Submission

The IRU supports the intention of the Tertiary Education Quality and Standards Agency (TEQSA) to use its data sets to provide:

  • better information about its actions; and
  • evidence of broad trends about how higher education providers are achieving or not quality outcomes.

Done well, it will:

  • assist universities understand where they stand against other universities and providers, making any adjustments considered useful; and
  • provide an insight to TEQSA’s thinking and assumptions.

It is essential that the release of information by TEQSA is designed to improve understanding of quality strengths and potential weaknesses across providers while avoiding creating unfounded concerns or targeting any individual provider.  Issues with individual providers should be addresses through TEQSA’s formal regulatory activity in response to any concerns about achievement of standards by a provider.

The consultation paper proposes five kinds of information for release. Read the response in full attached.