Group of Eight Calls for Both Government and Students to Share in a Funding Increase of Billions. (April 8, 2011)

The Group of Eight has put in a submission to the review on base funding for universities which on the face of it has all the trappings of blatant self promotion at the expense of the lesser lights of the sector. However, the Go8 need only undertake two guarantees for their push for uncapping fees to have universal backing from the Australian community.

1. Entrance qualifications must be set so that those most able gain entry; the current approach to get most bums on seats must end. And just because an individual can pay full fees shouldn't assure him entrance.
    

2. No Australian student who qualifies for entrance should be precluded from attending through lack of financial means. If, for example, the University of Melbourne wants to charge comparably to that of say Stanford University (full-time undergraduate tuition for 2010-2011 is set at US$38,700 plus all extra fees including living expenses) the university will subsidise financially disadvantaged students appropriately.

The section "Funding arrangements should support equity and access" which we have italicized  toward the end of the Go8 submission below recognises the need for support but is vague as to implementation. It is time realistic costings were detailed.

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        The Go8’s submission calls on Government to use the following list of principles to design future higher education funding policy.

                 Australia’s higher education system should be of international quality

• International benchmarking of the quality of the learning experience shows that the learning experience of Australian students is inferior to that of students in the US and the UK.

                 A quality higher education system requires adequate funding which should be sustainable

• Current funding rates do not support universities to achieve Government's participation and quality goals.

• Universities cannot fund a quality student experience at current funding rates.

• Base funding must cover the cost of university activities that contribute to the student experience, including infrastructure, scholarship and research, and student services and amenities. It should not be considered to fund teaching alone.

• An enhanced student experience can increase student engagement and raise success rates.

• Due to inadequate funding, universities have had to allow teaching infrastructure to deteriorate and student-staff ratios to rise, and student support services have not been provided at a level sufficient to meet international benchmarks.

• Revenue from international student fees has plugged the funding gap. Relying so heavily on international revenue was always dubious policy: now it threatens to become unfeasible due to softening international demand.

• Demographic growth, increasing demand for high level skills and Government attainment and participation targets will drive strong growth in domestic enrolments in the foreseeable future. Go8 projections suggest that EFTSL in CSPs will increase by 55 per cent (or more than 200,000) to 2030.

• It will not be possible for Government alone to meet the cost of projected growth in the medium to long term, and if universities have no room to raise tuition fees then quality is likely to decline further.

                 Costs must be shared between Government and students

• Funding reform must build on Australia's world-leading system of income-contingent loans.

• While Government should increase funding, its contribution will be limited by fiscal constraints. In order to make a sufficient level of base funding available, universities should therefore be allowed greater flexibility in setting fees.

                 Students should have greater choice

• Government has committed to a demand-driven system by removing caps on CSPs from 2012.

• To make the system genuinely demand-driven, the next step is to diversify supply by allowing institutional differentiation. A more diverse range of provision will be necessary to meet the differing needs of a larger and more diverse student body.

• Deregulating student contributions will allow price point competition. Students can make their own trade-offs between convenience, quality and price, as already happens in the international and postgraduate full-fee markets.

• Pricing flexibility allows universities to charge more for more expensive, higher quality services.

                 Funding arrangements should support equity and access

• Income-contingent loans lower up-front barriers to student participation.

• Fee deregulation means a closer alignment between what students pay and what they can afford.

• In return for pricing flexibility, universities must demonstrate their commitment to recruiting those students most able to succeed, regardless of their background, including those disadvantaged by their prior schooling.

• Improvements to funding of student living costs would be more effective than loadings for enrolment in improving participation of low SES students.

                 Allocation of funding should be as simple as possible, recognising

                 the complexity of contemporary higher education. Allocation of funding should be transparent

• Funding should be allocated on the basis of a simple formula, based primarily on student numbers as an indicator of the volume of activity. Additional earmarked components and loadings should be kept to a minimum.

• Base funding should include a more realistic level of funding for capital works and maintenance.

• Infrastructure funding should be an integral part of base funding as adequate facilities are an essential input to the student experience.

• The basis for allocation of funding should be explicit and should be related to quality benchmarks.