A good time to consider the value of universities to society

Universities need to do a huge amount of thinking about what their purposes are.

In a crisis such as this one the people who deal with it successfully and come out looking good are usually the ones with flexible minds, the ones willing to rethink what they once thought were eternal verities.

So the question for members of the Morrison government is this. Have you reflected on whether things many of you held to be true about universities — that they were bloated, overfunded, out of touch with mainstream Australia and not on board with national priorities — are withstanding the test of the coronavirus crisis?

As Australia successfully battles COVID-19 it’s evident that the knowledge and expertise we are relying on come from people who had a high level of training in our universities. Many still work there. They conduct their research, which has proved to be critical, in the university environment.

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Right now the Morrison government is very much concentrating on the crisis. But when the crisis eases I’d urge the government to step back and think about what value universities have in our society and how to ensure that they can go on giving that value.

None of this is to suggest that universities are perfect. They have manifest faults and the observation I started with, that the test of being successful in a crisis is how willing you are to question your fundamental beliefs, applies to universities as well.

Their revenue base has been ravaged and, on the other side of this crisis, they won’t be the same. Universities have a huge amount of thinking to do about what their purposes are and how to fulfil them while using fewer resources.

Meanwhile the crisis sets its own pace and the government has to make some critical decisions about universities (and other education institutions that rely on international students) before it will have time for deeper reflection.

It has to decide very soon how best to revive Australia’s $40bn a year education export industry, which directly injects more than $12bn a year in tuition fees to universities, more than $4bn a year in fees to other education institutions, and well more than $20bn a year into the general economy (outside of the education sector).

It’s a massive economic driver, and generates about 250,000 jobs.

Because of the travel ban, this industry is on its knees, and it won’t have a V-shaped recovery, as is hoped for many other sectors of the economy.

Instead international education could be suffering worse next year than it is now.

The reason is that it has a unique business model. It mainly relies on students who come to Australia for multiple years. Because of the prolonged travel ban, which it is now feared will last into next year, the economic damage grows year by year.

This year more than 100,000 won’t make it to Australia to study. That’s bad enough, both for them and for the universities or other education institutions they planned to attend. But if that group of students who were going to begin their courses this year can’t come next year either, then next year two cohorts of students are missing — the class due to start in 2020 and the class due to start in 2021. Both the economic losses and educational losses will mount.

Deakin University has been explicit about this. This year it expects revenue to be down by $80m to $100m because of COVID-19. But next year, when other sectors of the Australian economy expect to be recovering, Deakin estimates its revenue will be down by $250m to $300m.

Several things need to be done to avoid this escalating impact on education exports. First, many of the students who are currently enrolled need to get support to help them finish their course. Many have lost their part-time jobs. They don’t get JobSeeker or JobKeeper benefits and, while universities, other education providers and some state governments are doing their best to support them, more is needed.

Second, if it is consistent with expert health advice, the federal government needs to smooth the way for international students to arrive for first semester next year. This might involve testing incoming students for COVID-19; it also might require quarantine arrangements. But making that investment is worthwhile for a $40bn industry.

Nobody knows if the international education export business will recover to its former level. It’s possible that families in China, India and other countries will pull back from sending the children abroad because they are suffering economically. It’s also possible that, in the growing atmosphere of tension with China, that the Chinese government will put limits on students coming here.

But is also possible that Australia will be a very attractive destination for students next year if our main competitor countries, the US and Britain, are still be struggling with COVID-19.

One good sign is that some universities report that international students are showing themselves willing to enrol online, on the understanding they will come to Australia and study on campus when the border is opened.

The Tertiary Education Quality and Standards Agency has been very flexible, allowing international students to do online study from their home countries, something that is not normally permitted.

But even this is caught up in a bureaucratic bungle. In normal times students are allowed to stay in Australia after they graduate for at least a couple of years on a post study work visa. However, the Department of Home Affairs is dragging its feet and has not yet confirmed that students studying online from overseas will be considered to have accumulated enough time in Australia to get the post study work visa.

Crises are times to do things differently and the federal government can also think about the fact international education — Australia’s fourth largest export — has never before received significant government assistance. It grew to its current massive size on its own resources.

But there’s a first time for everything and the time to give assistance would seem to be now.