Grand hopes of a new vision for higher education were punted firmly beyond the political horizon in the Federal Budget, with promises of further regulation accompanying student support.
The already-announced HECS debt write off, Prac Payment scheme and indexation limit on HELP loans were widely supported, accounting for a significant chunk of the Budget’s headline allocation of $1.1bn over five years with a promise of $2.7bn more in the distant future from 2028-29 to 2034-35. Most money announced were recognised as long-overdue support for students. However, behind the polite applause, this Budget left more questions about what it did not fund than what it did.
The Federal Government trumpeted the launch of the Australian Universities Accord Final Report earlier this year, bringing forward 47 recommendations to transform the sector through increased participation, driven by a forecast that 80% of working age Australians will need a tertiary qualification by 2050.
The Budget was expected by many to provide a platform for the Government to deliver a clear response to the report, but in the midst of a cost-of living crisis, with immigration levels preoccupying both major parties, the Government’s views on many of the Accord’s recommendations remain unknown and the appetite to embrace its’ grand (but expensive) vision remains opaque.
Instead, the HE sector faces a period of considerable change and imposed strains, with a raft of changes that expand Government control over the sector, including:
- Ministerial-imposed caps on international students (pending consultation with the sector)
- Increased layers of regulation through the new Australian Tertiary Education Commission (ATEC), which will rule over the entire tertiary sector, presumably soaking up some of the $27.7 million over four years allocated in the Budget to “harmonise regulatory, governance and qualification arrangements between the higher education and vocational education and training sectors.”
- Preparation for a new system of ‘managed growth’ funding for universities to commence from 1 Jan 2026, to “more accurately reflect student demand, support efficient growth in places, and help Australia to reach its tertiary attainment target.”
- Preparation for a new needs-based funding system, again to be implemented by 1 Jan 2026, to support the four under-represented groups identified in the Accord (Indigenous students, students with a disability, students from low socio-economic backgrounds and rural and regional students).
- The National Student Ombudsman, to be established from 1 Feb 2025, providing a one-stop shop for student complaints – “with Government to explore arrangements for cost recovery from 2026–27.” Presumably cost recovery from universities, not students.
Against an overwhelming backdrop of yet-to-be-completed revenue modelling and regulation formulation, the Budget also delivered a number of smaller announcements worth noting.
Big pathway boost
The Budget offers $350.3 million over four years to expand access to enabling courses. This is a significant investment, with universities set to jump on the offer to fund new FEE-FREE Uni Ready preparation courses, starting next year.
ATEC
The worst-kept secret in Australian HE, the omnipotent new ATEC, kicks off on 1 July 2025 and will be responsible for “tertiary” note “tertiary” “education stewardship, delivery of funding arrangements for higher education, ongoing tertiary harmonisation and data collection and reporting.” TEQSA and ASQA are expected to report into the new super-regulator. As for data, there is an $8m cut over four years from next for the Quality Indicators for Learning and Teaching.
With reduced funding for measurement of learning and teaching and no mention of the Australian Research Council or ERA that Future Campus could find, the government is spending much to create a regulator which will in turn have a depleted evidence base to understand whether the sector is performing on fundamental research, learning and teaching functions.
Gender-based Violence action
The Budget allocates $18.7 million over four years for a National Higher Education Code to Prevent and Respond to Gender-based Violence, commencing on 1 Jan 2025 – with additional funding for this important initiative promised over the next decade.
$5.5 million for Departmental cases
Some of the funds lost from QILT will instead be spent on a $3 million business case developed by the Department of Education ‘for an appropriate information technology system to support the reforms to higher education funding and governance. That’s on the business case, not the system itself.
There is also $2.5 million for the Department to develop and implement regulation to require universities to establish new purpose-built accommodation if they wish to make a case for additional international students (subject to sector consultation).
What’s next?
What happens next will be up ATEC and tied to the Government’s determination to expand access. If universities want more money, “managed growth funding” will commence in January and “accurately reflect student demand, support efficient growth in places” – which may mean an end to high course costs for law, business and HASS students or it could mean not much money for student places, (note “efficient”).
The Committee to create ATEC will now get going – along with taskforces attempting to set international student numbers, introduce new operational systems, define and operationalise the managed growth and needs-based funding systems and bring the Tertiary sector together. May you live in interesting times indeed.
