Priorities are Demand Driven

Opinion piece - The Australian Financial Review - Monday 5 March 2012

The Report of the Base Funding Review poses a major challenge for universities and Government to respond to.  We need to use it to improve universities' capacities to meet the standards set for, and expected of, higher education over the long term.

The Bradley Report put the gap in resources at ten per cent of Government funding as a minimum.  The Base Funding Review demonstrates that the gap is real.  Its data suggests as much as 20% to 30% additional base revenue is required to match needed resourcing.  It reached its conclusion based on current and future requirements for effective higher education.

To implement all the Review's proposals is not realistic as a medium term goal due to the Australian Government's limited capacity for major additional expenditure in coming years.  Instead the IRU argues that the Government should commit to the Bradley review's recommendation for a 10 per cent increase in Government base funding to universities as an immediate goal, building on the 3.5% increase already in place.

The IRU believes there are four priorities for additional investment, each of which is directly based in supporting the demand driven system now in place.

1. First is Contemporary Learning Spaces.  The proposal addresses the lack of support for the basic infrastructure required to expand provision and ensure that existing facilities are up to future requirements.  The IRU supports the Review's proposed infrastructure loading set at 2 per cent of the base which would be allocated according to enrolments. This would play a major part in ensuring future students learn in an environment designed to support their needs with access to required equipment and facilities.
2. Second is to enhance programs to support the access to university necessary to ensure Australia has a sufficient number of bachelor graduates, drawing in people from all backgrounds.  The Review identifies that because the total funding is capped for both the low SES loading and enabling loading the income per student is dwindling as student numbers grow.  The loadings need to be set back to their initial level per student and maintained at that level.
   The current Review of Higher Education Access and Outcomes for Aboriginal and Torres Strait Islander People needs a mechanism to add to the current funding for Indigenous Units.  We need a focus on the whole of university support for Indigenous student progression while maintaining funding for the Indigenous Units.  Therefore the IRU argues that there should be additional enrolment and progression loading for Indigenous students.
3. Third, we can make better use of the Review's Flagship qualifications proposal to focus it directly at the full range of innovative approaches to the provision of higher education.  The Review proposes that universities could use 5% of enrolments for 'flagship courses' which would be funded at 150% of the standard Government and student contributions.  The Review narrowly targets flagships at courses for high achieving school leavers  concentrating a significant increase in funds at a small number of students and courses.  The IRU supports instead creation of a Course Renewal Innovation Program to support major projects for innovation in course delivery, including cross institution delivery, that over time would improve learning for a wide range of students, not a narrow subset.  It would not require students to pay higher student contributions.
4. Fourth is small changes to the cluster funding levels targeting the four clusters the Review identifies as most underfunded.  This will not create the new relativities between the lowest and highest clusters the Review proposes but be a moderate step to achieve its recommendations, while ensuring that no cluster loses funding.  The Review's proposals require something like a 17% increase in Government funding, which is too ambitious for immediate implementation.

The Review rightly supports continuation of a capped student charge, supported by income contingent loans.  It makes clear the weakness of the current three rates of student charges which are applied quite arbitrarily to different disciplines.

The Base Funding Review proposes to charge students 40% of the notional resourcing of each unit they study.  It is focuses on the notional cost of the course as the key factor in deciding a suitable level to cap the student charge.  As a result it would place units of agriculture at the same price band as those of medicine, both three times the price for accounting and humanities units.  The weakness is that unlike a car - where higher price aligns strongly with better quality - the cost differentials across courses are intrinsic to the nature of the qualification.  The intent is that each student gains a good to high quality learning outcome.  Where it costs more to do so students do not get a better degree, they get what is needed for the outcome of a suitable qualification.

Our argument is for a single standard charge of up to the current rate of $8050. Australia requires graduates across a range of disciplines.  The public good from investing in universities comes from both the individual impact of each graduate and from having a mix of graduates across all disciplines and professions.

To charge some students more for the benefit of their degree simply punishes them for pursuing their interests.  Students should not be influenced by the cost to them in their choice of course but focus on what is likely best suited to them.  Universities in offering Government supported places should compete in terms of the nature and quality of the education they can provide not its price.