Conservative government cuts university spending

Despite pre-election promises it would not slash spending on Australia’s universities, the new conservative government of Prime Minister Tony Abbott has done just that – with a A$900 million (US$825 million) cut from university grants.

In addition, the nation’s 820,000 university students will lose discounts they currently receive for early repayment of their higher education loan debts – and that will cost them almost A$300 million.

Australia’s federal Education Minister, Christopher Pyne, introduced a bill to cut spending on universities and students last Thursday, at the end of the parliament’s first sitting week under the new government. Pyne admitted the Higher Education Support Amendment (Savings and Other Measures) Bill 2013 would be damaging to the university sector.

The bill takes more than A$900 million out of government grants to universities via an “efficiency dividend”, while students who repay portion or all of the money they owe for loans provided by the government to cover tuition costs will no longer receive substantial discounts.

Under the bill, a “dividend” or cut of 2% will apply to federal government contributions to universities next year, followed by a 1.25% dividend in 2015, “saving” – that is, costing universities – A$903 million over four years.

In speaking to the bill in Parliament, Pyne actually criticised the cuts, saying the government had no choice but to proceed with the measures because of the "fiscal mess" it had inherited from the Labor government that the Coaliton had defeated at the September election.

"These are Labor's cuts. These cuts show just how damaging to the university sector the previous government was,” Pyne said. “They show clearly that Labor is no friend to universities. They show that Labor is no friend of students or higher education."

Although Labor had planned to impose the so-called dividend, it lost the election before the bill could be passed. Yet Pyne's comments were remarkable coming from a minister who was confirming the cuts to university budgets yet who had also said previously there would be no reductions to university spending in next May’s budget.

"[Prime Minister] Tony Abbott has already indicated we will not be cutting education or health," Pyne told a television interviewer. "I'm not going to jump ahead of the budget in May next year (but) the education budget as forecast over the next four years will not be cut by the Coalition, that's very clear."

Jeannie Rea, president of the National Tertiary Education Union, said she found it extraordinary that Pyne would introduce legislation into Parliament which he openly acknowledged would be damaging to universities and their students.

“It is simply not good enough for the Minister to blame the previous government for the cuts. By proceeding with them he is giving them his full support and endorsement,” Rea said. “This undermines my understanding of ministerial responsibility if ministers blithely get away with policies they know will damage institutions for which they have responsibility.”

The Abbott government has a substantial majority in the House of Representatives but not in the Senate where the Labor Party, the Greens and minor parties hold the balance of power. It was this that Rea referred to when she called on “all members of parliament who care about our universities” to oppose the bill.

Rea said members of the Labor Party had cause to be especially angry because Pyne had refused to guarantee the increased funding for school improvement the previous government had promised and which the university cuts it had proposed imposing were originally intended to help fund.

In a speech on innovation and research in May, Pyne as shadow Education Minister said a Coalition government would seek to cut the bureaucracy rather than university funding, although he added that research funding “should be commensurate" with its importance to the economy.

Another part of the bill he introduced on Thursday removes a 10% discount students had received if they paid their tuition fees on enrolment rather than accept a government loan under Australia’s HECS scheme, now known as the Higher Education Loan Programme.

As well, a 5% bonus for making voluntary repayments of A$500 or more will also be abolished from next January. The changes to the incentives for early payment of student contributions are projected to “save” A$277 million over four years but will cost students the same sum.

In a speech to a conference of university leaders last January, opposition leader Tony Abbott said “good universities deserve all the support and encouragement they can reasonably be given and as much freedom to run their own affairs as can reasonably be managed”.

“They have no more right to waste money or to be indulged than any other institution. They should have to make a case for taxpayer support like every other good cause. Still, provided it goes into teaching or research, university funding rarely fails to be worthwhile,” Abbott said.

“Not everyone needs a university education but everyone benefits from one. More graduates, particularly in the `hard’ disciplines of maths, science and engineering, mean a stronger economy and greater prosperity for all. That’s why reasonable public investment in higher education is not dudding poorer people to help richer.”

Abbott assured the vice-chancellors and deans that a Coalition government would be “stable and consultative”. “If we put in place a policy or a programme, we will see it through. If we have to change it, we will consult beforehand rather than impose it unilaterally and argue about it afterwards,” he said.

Then again, it is possible Christopher Pyne was not listening.


So depressing! No more smart state, and heading further and further away from being a clever country.

Holli Evans on the University World News Facebook page

What an absolute fool. Cannot wait to move to Europe.

Christopher Weir on the University World News Facebook page