Coalition policies will cut $1bn a year from universities

Federal government university funding policies will cut nearly $1bn a year of Commonwealth money from universities.

Federal Minister for Education Dan Tehan at the National Press Club in Canberra. Picture: AAP

The federal government’s university funding policies will cut nearly $1bn a year of government money from universities, according to new modelling from one of Australia’s foremost higher education analysts.

Former federal Education Department official Mark Warburton told a University of Melbourne webinar on Tuesday that the combined impact of Turnbull and Morrison government changes to university funding would reduce commonwealth funding to universities by $988m a year to the end of 2023.

His analysis takes into account the freeze to university course subsidies announced by former education minister Simon Birmingham in December 2017, as well as the latest funding package announced last month by incumbent Education Minister Dan Tehan that is due to take effect from next year.

Mr Warburton also said that the extra student places funded by the Tehan package were “illusory” because they failed to make up for the places lost due to the Birmingham changes.

He told the Centre for the Study of Higher Education webinar, titled What Will the Tehan Changes Mean for Students and Universities?, that the impact of the Tehan package would cut a net $722m a year from government university funding.

This is in addition to the impact of the 2017 Birmingham package, which withdrew a net $266m a year from universities, leading to a total cut of $988m a year.

Mr Warburton said the Birmingham changes had cost universities 23,000 student places a year, which meant the extra student places promised by the Tehan package were “illusory”.

He said that in its final year (2023) the Tehan package would put “about 15,000 subsidised ­places back into a system in which 23,000 places would no longer be subsidised due to the cap on places from 2018 to 2021”.

“So there really isn’t any growth in student places happening,” Mr Warburton said. He also questioned the government decision to divide the current funding to assist low socio-economic status students, the higher education participation and partnerships program, and assign about 60 per cent of its $190m value next year to rural and regional students.

“I’ll leave to you to decide if this is a proportionate response to the low education attainment of rural and regional students, given that we know that attainment by the much larger group of low-SES students also need lifting,” he said.

Mr Warburton’s analysis is the most detailed so far showing the impact of the Tehan package on universities and students, revealing outcomes that the government has not as yet made clear.

Mr Warburton said his analysis was based on the data currently available from the government’s documentation and he would welcome the release of more information.

He praised one element of the Tehan package, the restoration of CPI indexation for university funding, as “good policy”. But he said the “lack of any real system growth” and new student contribution levels that aimed to influence student choice of subjects were “bad policy”.

He said the combined effect of the Birmingham and Tehan changes meant “there is little scope to meet future growth in the prime university age cohorts and any additional demand arising from the COVID-induced economic slowdown”.