New government promises uncertain start

When Australia’s federal Treasurer Joe Hockey addressed the National Press Club just before Christmas, he did not come bearing gifts. Not that universities were expecting any – but vice-chancellors must still have been alarmed by what Hockey had to say.

Presenting the new conservative government’s economic and fiscal outlook for 2014, the finance minister said Australia faced a A$47 billion deficit (US$42 billion) “and A$123 billion worth of cumulative deficits over the forward estimates”.

“In the absence of any policy changes from what we have inherited, the budget would not return to surplus within the 10-year medium-term projections. During this time, gross debt on issue is projected to increase to A$667 billion,” Hockey said. “The budget the coalition government has inherited is simply unsustainable.”

Although Australians will have to wait until May to find out where all the inevitable cuts in government spending will occur, universities have already learned of the first of what will surely be severe paring of their budgets.

Severe cuts to science budgets

In his speech, Hockey shocked the nation’s scientists by announcing that the key independent research granting body, the Australian Research Council or ARC, would lose A$61 million from its “discovery programme” and A$42 million from its “linkage programme”.

Dr Ross Smith, president of Science and Technology Australia, which represents 68,000 scientists, said cutting A$103 million from the ARC’s budget would further limit its capacity to fund fundamental and applied research – at a time when the success rates for applications for world-class grants are already below 25%.

"Australian scientists are afraid this will lead to fewer jobs and training opportunities for our best and brightest. We are also concerned about funding for important humanities and social science research, given the cuts,” Smith said.

"Scientists and research funding agencies understand that governments need to set priorities for research but priority setting is very different from political picking and choosing. Peer review is simply the best way of ensuring tax-payers dollars are invested in world-class research every time."

The politics

The Abbott government had already announced that it planned to implement cuts proposed by the former Labor administration which, before it lost the September election, was preparing to slash A$2.3 billion from federal spending on higher education.

In a bizarre reversal of roles, however, Labor’s new leader Bill Shorten and his team have decided to oppose the bill, due to be enacted, when it comes before the parliament and will no doubt remind Prime Minister Tony Abbott of what he told a Universities Australia conference in February last year 2013:

“As intellectual powerhouses, 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,” the then Opposition leader declared.

Abbott outlined seven principles he said the coalition of conservative parties he led would follow if they won government.

“First and most important, we will be a stable and consultative government. If we put in place a policy or a programme, we will see it through,” Abbott told the conference.

“If we have to change it, we will consult beforehand rather than impose it unilaterally and argue about it afterwards. We understand the value of stability and certainty, even to universities.”

Unfortunately, when the conservative coalition parties easily won government at the elections and Abbott became prime minister, this was the first promise he broke.

Having gone into the election making various commitments regarding schools and higher education, Abbott found it was easier being a highly negative Opposition Leader than actually taking charge of the nation.

Implications for universities

It now seems certain that universities will lose more than the A$2.3 billion, plus the $103 million slice from the ARC.

But they could see a ban being lifted that could allow universities to generate more money. This was imposed by Labor on Australian students who missed out on a university place but were allowed to enrol by paying the full cost of their courses.

Described by critics as a means for ‘rich but dull’ students to buy their way into university, when the scheme was first adopted by a former conservative government, it also brought millions of dollars of needed income into depleted university coffers.

Unfortunately Australia’s new Education Minister, a South Australian former lawyer called Christopher Pyne, has proved even less trustworthy than his revered leader. Pyne has been forced to make several policy u-turns or, as journalists describe it, to perform double backflips.

Three months into the conservatives’ three-year term, opinion polls show the Abbott government is now less popular than the Labor administration it deposed in a sweeping victory. It seems to be less a brief political honeymoon than an almost immediate divorce by Australian voters.

Student cap on or off?

One of Pyne’s first acts was to order a review of a Labor government decision two years ago to abolish limits on the number of students universities could enrol.

This ‘demand-driven system’ has given an additional 190,000 students – most from disadvantaged backgrounds – access to higher education but has also sparked concerns from some critics that quality is suffering.

Pyne said a review of the system was one of his top three priorities, to see if an impact on quality was occurring. ''It's a very important reputation to maintain and the poison that would undermine that reputation would be a diminution in quality,'' he said somewhat obscurely.

“Quality is our watchword and we aren't bound by the previous government's policy decisions.''

The government would make ''sensible, methodical reforms'' to maintain the number of students going to university and encourage those from poorer families, indigenous communities and remote parts of the country, Pyne said.

But he also said the government would abandon Labor's target of increasing participation from these groups to 20% of the student population by 2020, and also to have 40% of Australians aged 25 to 34 years holding a bachelor degree or higher by 2025.

Pyne said he did not believe in "targets for targets' sake: Labor was obsessed with targets [whereas] we’re obsessed with outcomes.”

Recently, Pyne appointed former right-wing education minister Dr David Kemp and his previous policy adviser Andrew Norton to review the so-called ‘uncapped’ system of university places.

They have been asked to investigate the effectiveness of the system, including: evidence of increases in participation and access for students from low socio-economic status backgrounds; any potential adverse impacts on the quality of teaching and of future graduates; and what measures universities are taking to ensure teaching quality is being maintained.

Kemp and Norton will also check whether less academically prepared students are receiving the support they need to complete courses of study and will make recommendations on possible areas for improvement by mid-February.

Labor’s higher education spokesman Senator Kim Carr said the Opposition would be "extremely concerned" if the review became a “stalking horse” for increasing student fees for undergraduate courses, which would limit access for poorer students.

"Let’s not forget this review is being conducted by the former minister and his adviser [who] oversaw the introduction of measures while in government for domestic undergraduate students to be charged full fees," Carr said.

Left-wing student organisations have called on campus student groups to fight “odious silver-tails like Christopher Pyne who are intent on turning our universities into right wing profit-driven playgrounds for the children of the elite”.

A promise that will be kept

Meantime, the one pre-election promise the conservatives seem certain to keep is their New Colombo Plan.

This A$100 million, five-year programme will offer scholarships covering the full costs of study abroad for up to 300 undergraduates for one or two semesters, with smaller subsidies for shorter programmes for many more students.

Where possible, the scheme will also provide internship or mentorship arrangements with businesses, NGOs or government agencies in host countries. The government intends to start with a pilot programme this year and aims for it to be fully operational in 2015.

Foreign Affairs Minister Julie Bishop, who developed the scheme, said the plan would foster closer ties between Australia and the region, and help create stronger people-to-people links.

Under the original Colombo Plan that ran from the 1950s to the mid-1980s, 40,000 potential future leaders from across Asia came to study in Australia at no cost. Bishop said many of the changes seen in the region over the decades had been influenced by those students who had studied in Australia and returned home and helped to lead others.

Apart from this one programme, however, the only certainty for universities in 2014 is that they face a very uncertain future.