Universities Australia Pleads for Increased Funding in May Budget. (January 19, 2009)

Despite the expected massive deficit in the US federal budget, late last week the US House of Representatives draft proposal for the government's economic stimulus package contains according to ScienceInsider: "US$13.3 billion in R&D funding -- US$9.9 billion for the conduct of research and development and $3.4 billion for R&D facilities and large research equipment, mostly extramural.

Adding in another US$2.5 billion in non-R&D but science and technology-related funding brings total science and technology-related funding in the stimulus to nearly US$16 (A$23.6) billion. There is also additional money for higher education construction and other education spending of interest to academia."

In the meantime there are growing fears in Australia's academic community that despite the country being better placed to weather the predicted recession than almost any of its OECD cohort, the May budget will contain little in the way of support for an education revolution so far as the tertiary education sector is concerned. Note for example the populist mantra from the leader of the federal opposition, Malcolm Turnbull: "A deficit must be a last resort, not an easy way out. Mr Rudd wants to get a leave pass to run a huge deficit so there can be no constraints on spending. We will hold him to account - not just for the level of deficit, not just for the amount of spending - but for its quality and effectiveness."

Last week Universities Australia (UA) in its submission to Treasury said:  "The university sector, starved of public funding for the past decade, has a significant backlog of priority expenditures that would see an immediate return to the economy in terms of short-term spending on infrastructure and employment."  Specifically it requests a $1.2 billion budgetary increase to fund teaching, research and increased participation of indigenous, rural and poor students.

Were indexation increased to fully cover inflation, there would be an overall 20% rise on the estimated $7.2 billion given the sector in 2008-09.

Universities Australia also proposes a $1billion off-budget disbursement for tertiary education from the newly created $8.5 billion Education Investment Fund to upgrade infrastructure. While that would be in addition to the $1 billion received this past financial year, UA claims the sector has a backlog of more than $12 billion in required new building and maintenance work.

UA chief executive Glenn Withers told The Australian: "It's good economics to use that fund to invest in the support of current activities, and in a sector that pays off in the long term as well," and he says that the sector has billions of dollars worth of shovel-ready infrastructure projects to be submitted.

In any case the next several months will show the strength of the Rudd government's resolve to combat the the effects of the financial downturn and whether or not it takes its lead from Keynesian theory.