DEEWR’s latest higher education newsletter, published today, mostly summarises prior announcements. But there was one statement worth noting:
The Government will announce the details of the review of base funding levels in 2010. While it is for the review to consider the appropriate level of base funding, … early estimates of over enrolments for Commonwealth supported places in 2010 suggests that universities will increase their number of Government funded places while being funded at current rates.
What this effectively says is that the government does not need to increase per student funding rates because universities will be stupid enough to keep enrolling more students even while the government keeps slashing their real funding.
I despair at the lack of political strategy and skill in the higher education sector.
Andrew Norton 
There’s no point in blaming universities for that, since the only way around it is to (a) drop expensive courses; (b) move expensive courses into the full-fee paying postgraduate realm; (c) get more overseas/full-fee paying students; or (d) find other sources of money that don’t involve students (no simple matter). This all takes a lot of time. Obviously, as Melbourne shows, you can do it, but you need a decent VC to start the process. So everyone just puts up with trying to do more with less and people wonder why the quality of degrees is not what it used to be.
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The alternative is that universities start getting rid of staff they can’t afford (ending up with less than they started with), and no-one wants to do that, since if you can’t use perceived job security or other forms of payment for the poor salaries in many areas, then you are going to be left with no decent staff. I can think of individual departments where they had funding cuts and this happened, and it was basically a disaster — all the good people left and the not so good people stayed, and it affects everything (teaching, research, morale, getting good staff to replace the ones that left etc.).
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Conrad – No, there is every point in blaming universities. They are in my view significant makers or their own misery through inept political strategies. They seem to have internalised the governments view that universities are little more than glorified state schools under the department’s control. That is not the legal case. They can and should refuse to take any additional subsisided students until the government delivers a better funding deal. They should do what every other business and interest group does – engage in argy-bargy to get a better outcome, rather than meekly accepting whatever the government wants, no matter how absurd.
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Andrew,
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I don’t doubt that universities have been historically poor politically. However, this can only be changed in the long term, and I very much doubt it is going to be done via collaboration across universities. It’s going to be done the way Melbourne did, with other universities to follow, and this can only be done thanks to the reforms of the last two decades (i.e., getting full-fee paying students and getting rid of students in the government regulated categories). It seems to me that if you look at things from a broader perspective, university funding is really linked more to what the general public thinks, and this is a cultural thing, and not how tough or smart university management is. In France (and Germany is similar), for example, the universities are brutally tough politically compared to here (recently, they were wondering what to do with students who had lost an entire semester due to strike action), but their funding situation is crap. In HK (and Singapore is similar), alternatively, no-one ever thinks of going on strike, higher level management doesn’t play nasty games with the government much, but the funding is around twice as much per student as here. Not surprisingly, the quality of education the average student from HK or Singapore gets is leaps and bounds ahead of the average French or Australian student.
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In the short-medium term, it’s impossible to say no to more students if you are stuck in the old-school university model, which, currently, everybody apart from Melbourne and possibly UWA is — it’s basically a prisoners dilemma situation, if you don’t take them, some other university will, and you will go broke. Whilst everyone complains about this, it’s just the reality for most universities, and the main group affected are not university staff, who just cut more and more corners, it’s kids going into the system who end with a shoddy degree.
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Conrad – I don’t agree with you on the strategic issue. My strategy here isn’t to cut numbers (though I don’t oppose that). It’s to take advantage of the government’s desire to increase numbers by refusing to do so. Though obviously there is a complicated relationship between average and marginal costs, I am confident that any substantial increase in student numbers would see marginal costs exceed marginal revenues in most disciplines in most universities. If this is correct, the short and long-term revenue interests of universities are in alignment. Even if the political strategy for better funding (whether through government funding or student contribution deregulation or both) eventually fails, universities are still better off in not taking on the additional costs of more students.
Australian per student funding is actually above the OECD average, thanks to high private levels. I don’t know how it compares with Singapore and HK. I expect there is a cultural element to public funding levels, but Australians are (relatively) culturally OK with private spending on education. This is where the extra money can come from if fee regulation is relaxed.
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Incidentally, I do not believe the Melbourne Model is a solution to financial issues. If there was a larger shift to a full-fee model it might be (depending on what happens to costs), but not as it stands.
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