The University of Newcastle, Australia

2014-2015 Federal Budget: implications for the higher education sector and students

Wednesday, 11 June 2014

After the IED detonated in the higher education sector following the Federal Budget announcements, the aftershocks continue to ripple through the sector as colleagues in universities absorb the impact.

There are a select few universities that have supported the prospect of unleashing the sector's 'true' market potential in a deregulated environment. There are, however, many of us who are concerned that the reputation of Australia's higher education system as one which supports both equity of opportunity for students and institutional excellence is being dismantled and replaced by a system in which the best education resources will be available to a fortunate minority.

Most of us would agree, that one of the great strengths of Australia's current higher education system is that it offers people with talent and determination a fair go regardless of their background. In recent years, opportunities to enter higher education have opened up significantly. Since the introduction of the demand driven system, almost 100,000 additional undergraduate students have entered Australia's universities. The Kemp-Norton Review, commissioned by the Government and released earlier this year, highlighted that it is students from low socio-economic backgrounds, regional and rural areas, and Indigenous students, who are particularly benefitting from the demand-driven system.

Of course, building participation rates in higher education is of great importance for universities such as UON where improving educational attainment in our communities is part of our mission. ABS Data indicates just 13.8% of people in Newcastle and the Hunter hold a bachelors degree or higher, and on the Central Coast the figure is 11.9%. This is significantly lower than the equivalent level of attainment across NSW of 20.7% and 40.5% in Greater Sydney. Our proportion of students who are from a low socio-economic background is 23.7%, higher than the state average of 16.6%; and UON is a national leader in the number of Indigenous enrolments with more than 800 students enrolled in 2014.

To counter any unintended consequences of fee deregulation in the new market-driven environment, the Government will require any university charging fees above current levels to put 20 per cent of excess funds into an 'equity fund'. The equity funds, which each university will manage, are intended to provide for scholarships and bursaries for disadvantaged students. Interestingly, this scheme has been badged as a "Commonwealth" Scholarship Fund, despite being entirely funded by student contributions.

Logically, this means that the Group of Eight institutions, which are likely to leverage their brand to charge higher fees, will have larger scholarship funds than other institutions. The number of scholarships available at the Group of Eight institutions will necessarily be limited by the fact that they need to be at higher levels to meet the higher fees. It is also of concern that the Group of Eight has an average of just 8.8% of students from a low socio-economic background and they have not had a traditional focus on an equity mission.

Perhaps most worryingly, in this proposed system institutions will allocate scholarships based on their individual definitions of equity, which may or may not align with commonly understood measures of disadvantage. I am not sanguine about a policy which places the onus of supporting intergenerational social and economic mobility through higher education in Australia in the hands of a few institutions. I would much prefer to see a significant proportion of the funds raised for equity scholarships to be distributed through a national mechanism that supports students in equity groups attend institutions which have a demonstrable track record of experience and success in this area.

Universities have been invited to talk to the Government this month about the equity component of the higher education reforms. We will engage in discussions and represent the interests of the prospective students in our regions. As Hilary Clinton once observed 'talent is widely distributed, opportunity is not'- we will work to keep the opportunities open.

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