Executive Director, Group of Eight Comes Out Swinging. (November 14, 2008)

In a previous incarnation Michael Gallagher was first assistant secretary, higher education division, in Dr. David Kemp's old Ministry of Education, Training and Youth Affairs which later morphed into the Department of Education, Science and Training.

Dr. Gallagher left the public bureaucracy to join the Australian National University as its directory of Policy; then in the middle of this year he took over from the retiring Virginia Walsh as Executive Director of the Group of Eight.

In the meantime Dr Kemp has left politics and Brendan Nelson, whom Dr Gallagher served for a time at DEST, has been moved over to Defence, where he appears to be causing less damage to the nation's well being, to be replaced by Julie Bishop, another alter ego of John Howard and similarly antagonistic to higher education.

In today's Australian Dr Gallagher opens with: "Federal Education, Science and Training Minister Julie Bishop has suggested there should be no additional public spending on universities at this time and, before the sector is more deregulated, universities must show they are efficient and productive. Opposition education spokesman Stephen Smith sees the need for more funding but not deregulation. Neither has it right... neither side understand(s) that the sector cannot progress under a persistent pre-Gorbachev model of central command?"

In response to the accusation by Ms Bishop that universities had no right to keep holding out their begging bowls as they were in financial surplus, Dr Gallagher writes: "University surpluses are not a product of imprudent management... At about 6 per cent of revenue, the average safety margin is strong but the surpluses are hardly huge, and they are not available for recurrent expenses. Liquidity is tightening, with the ratio of assets to liabilities falling from 1.8 in 1996 to 1.2 in 2006. Capital costs are also increasing because of new works for competitive state-of-the-art facilities as well as backlog maintenance."

The Group of Eight's executive director then proceeds to give Ms Bishop a one sentence economic lesson: "A university can be said to be operating on a financially sustainable basis when 'it is recovering its full economic costs and is investing in its infrastructure (physical, human and intellectual) at a rate adequate to maintain the future productive capacity needed to deliver its strategic plan and to serve its students and customers'."

After using a Group of Eight definition of university sector  productivity as: "[T]otal productivity - graduate output and research publications for each unit of labour (all academic and general staff)," he finds productivity "grew by 6.3 per cent a year from 1995 to 2000 and by 5.9 per cent from 2001 to 2005."

He takes issue with the Minister's accusation that "administration costs of universities are increasing at the expense of teaching and research" and replies:

Increases in general staff numbers reflect four main factors:

* Back-office support for productivity gains in teaching and research ( such as information technology systems and online learning design).

* Laboratory and workshop technicians supporting research.

* New professional skills supporting revenue diversification (for instance, international operations, marketing, research commercialisation, alumni services, investment management and outsourced services).

* Increased compliance burdens of government regulation, multiple funding schemes, preparation of bids for competitive funds and extensive reporting requirements.

And then challenges, "Cuts to government red tape would give universities greater operating flexibility. Cuts to administrative staff would merely increase administrative burdens on academic staff, resulting in reduced performance across the board without increased cost-effectiveness... Micro-economic reform through deregulation is a necessary precondition for continuing productivity improvement in the university sector. Increased public investment is also needed to spur further progress in a more deregulated environment."

Not quite six years ago TFW printed the following News and Views item which some readers may find of interest:

 "Minister set to reform Australia's universities" (January 31, 2002)
    So reads the headline over Peter Pockley's article in today's issue of Nature (415: 460 (2002)). It's interesting reading particularly when coupled with Nature's editorial in the same issue, "Summits that matter:  The European Commission has made good progress in gathering support for its new programme of basic and applied research. Now Europe's industries and heads of state need to fulfil promises made two years ago."
    In his article Pockley opens with, "Australia's hard-pressed universities can expect no financial relief from the new government until May of next year at the earliest, says Brendan Nelson, the country's new minister for education, science and training [DEST]," and is immediately followed with, "[He] pledged to enact reforms that will help Australian universities to carry out internationally competitive research." At this point you may be wondering if Dr. Nelson ought to be known as the "Wizard of DEST" because it sounds... to good to be true? No fear. Dr. Nelson continued, "The universities have been reviewed to death we know what the problems and challenges are." And while eschewing yet another review per se he intends to set up a consultative panel which will "propose concrete changes in university governance, working conditions and the way in which specialist strengths are split between universities" to help him prepare a university-reform package to take to cabinet. It may engender additional funds following the May 2003 budget. Here we have yet another minister who gives every appearance of believing that the foremost problem of our university system is one of incompetent management. Funding gets mentioned as a secondary consideration. It appears to be a view very similar to that espoused to the Senate committee looking into the matter of the Australian university system's competence to do its job by Michael Gallagher, then first assistant secretary, higher education division of Dr. David Kemp's old Ministry.

Senator Carr (Labor)-- Professor Chubb [ANU Vice-Chancellor who previously told the committee that the university system was in crisis] says that... when your infrastructure is eroding and when you see all your equipment and your capacity to provide the resources you need for the staff to do the work that they want to be able to do slowly but surely degrading, then that does not make you very happy at all. How do you respond to that proposition? Is it an exaggeration?

 

Mr Gallagher--  ...I do not think it is surprising that a committee set up like this one to review the higher education system will draw disaffected submissions from various parts of the sector, including--

 

Senator Carr-- We are talking here about the vice-chancellors.  At Sydney, there were five vice-chancellors putting this position, representing some of the most prestigious institutions in this country. They are hardly what you would call a disaffected group or disaffected individuals. These are not your normal run-of-the-mill agitators--heaven help us.

 

Mr Gallagher-- They are making up for lost time, by the looks of it.

 

Senator Carr-- But is it not, therefore, a concern to the department that we should have such a widespread collection of opinion coming to us saying that the system is in deep crisis?

 

Mr Gallagher-- I put it back to you again that the people who are advocating that position to you are possibly looking for an easy way out rather than fronting up to their management responsibilities.

            [Monday, 13 August 2001, Canberra. Senate Committee—References EWRSBE 1350-51]

    And a final point which may leave you wondering just what our part time Chief Scientist and the Prime Minister’s Science, Engineering and Innovation Council  are supposed to be doing. Pockley writes, "Nelson pledges to appoint a scientific adviser in his office 'who will have credibility in the science community and will live and breathe science.'"  That's all the universities need right now, another internecine governmental turf war.
    Oh yes, that editorial. It opens with,

Few occasions would seem to be more remote from the everyday concerns of researchers than meetings of heads of state. Give researchers the prospect of significant funds to pursue their interests, and the autonomy to do it in the way they think is best, and you'll get their attention. Issue summit communiqués about the need to increase competitiveness and they'll nod off. But both approaches are now on the agenda in Europe, and both have the potential to boost scientists' scope for action.