Post Budget Analysis

The political and economic imperatives for a tight 2011 budget removed any prospect for any major announcements of benefit to universities.  Instead the 2011 Budget maintained the Government's support for the reform program it outlined in 2009 across teaching and learning and research.  It was a budget night where no news was likely to be good news.

Both DEEWR and DIISR made savings overall across each Portfolio. But these need to be set against the growth in funding already in train.  The Government estimates that funded undergraduate places will increase from 488,000 this year to 517,000 in 2014.  Funding will reflect the extra places and the improved indexation.  The base Commonwealth Grants Scheme grows from $5.5 billion to $6.6 billion over the next four years.

Funding per head remains the major issue. The base funding review, due to report later this year, should have two outcomes.  First, is to make the case for the higher level of investment required for universities to provide the quality of education that is expected of us.  Second, is to revamp how that funding is allocated to give universities sufficient incentive to enrol all suitable students, responding to students' preferences for course and provider.  Our submission can be found here.

The Government's funding to encourage enrolment of low-SES students improves resources for teaching and learning as does the funding for participation in the development of performance funding arrangements. But most of the actual performance funding is being held back a year.   This is because we have not developed all the necessary measures providing an easy saving for the Government. One challenge ahead is to ensure viable measures are developed that will give Government a reasonable basis to decide whether each university is providing the agreed quality of education to its students. The measures will be applied to each university against its previous record, not in comparison with other universities.

On the research front the focus for the coming year is to maintain the pressure for renewal of the DIISR grants for the Research Training Scheme (RTS) and the Joint Research Engagement (JRE) program. These programs and their predecessors have not increased in real terms over the past decade, yet they provide the main revenue for universities to develop their research capacity.  In contrast, the project funding for the Research Councils and its support through Research Infrastructure Block Grants (RIBG) and now Sustainable Research Excellence (SRE) have more than doubled significantly changing the balance of research funding.

Infrastructure is the other major issue for the year ahead. The 2011 budget saw the end of both the National Collaborative Research Infrastructure Strategy, which has funded landmark research infrastructure and, at the other end of the scale, the Capital Development Pool which supported the renewal of basic university infrastructure for staff and students.  As universities face their task of both expanding provision to meet the needs of more Australians and remaining competitive on the international research frontiers funding for facilities, both new and old, is crucial.

In the short term the Education Investment Fund now needs to look beyond the relative individual merits of particular projects put to it to considering their value for the Australian university system as a whole in meeting our objectives. For the longer term, we need a positive response to the advice to ensure an ongoing base for major research infrastructure investment and a clear means to support the infrastructure needs of expanding universities.

Conor King