‘Sweet spot’ spending tipped for Australian budget

Pundits expect a significant down payment on higher education reforms to be included in Australia’s forthcoming federal budget, although big ticket commitments may not emerge before next year’s election.

Former La Trobe University vice-chancellor John Dewar said he expected any budget largesse to be “very focused on what’s going to help the student…whether that’s changes to Youth Allowance, indexation of [student] debt [or] helping with placement costs.

“I think the government might be looking at cost-of-living relief on the one hand, and cost-effective measures to drive the post-secondary integration agenda. That would be my guess.”

Professor Dewar, now a partner with advisory firm KordaMentha, said the government could advance the Universities Accord review’s ambitions significantly by proceeding with reforms to the Australian Qualifications Framework or supporting degree apprenticeships or microcredentials.

“Those connective tissues between vocational and higher education are absolutely central to what the accord is about, [and] quite inexpensive to implement because they’re policy reforms. Not many of them would require a lot of money, but they could make a big difference,” he said.

Universities Australia chair David Lloyd said improved income support, fee-free preparatory courses, payments for compulsory student placements and “modest but necessary” loan scheme changes were “sensible measures” proposed by the accord panel.

“All of those recommendations are attainable in the near term,” Professor Lloyd told advisory firm HEDx’s Changing Higher Education for Good conference in Melbourne. “And those recommendations together could move the dial on participation.”

University of Newcastle deputy vice-chancellor Kent Anderson said he expected a budget allocation of between A$50 million (£26 million) and A$80 million to support students on compulsory practical placements, possibly through a new scholarship scheme.

A further A$30 million to A$50 million would be committed to enabling programmes, and A$15 million to establish a tertiary education commission. A few million dollars more would go towards technically challenging but potentially inexpensive initiatives, such as fixing anomalies in student loan indexation.

Professor Anderson, who worked as an adviser to former education ministers Dan Tehan and Alan Tudge, said government spending on early childhood education was politically “really attractive” during a cost-of-living crisis. “That hits people’s back pockets,” he told the conference. Schooling was equally important “because everyone wants their kid to have a good job and a good life.

“So in this upcoming series of budgets, saying we want more research is a hard sell. Saying we want more [university] students is a pretty hard sell, particularly when they’re not rocking up. I think [education] minister [Jason Clare]…will be able to cash about A$100 million in this budget for us. The question is where he spends it. I would spend it on equity.”

Professor Anderson said he expected any large-scale accord-related spending to be flagged during the 2025 election campaign. In the meantime, Mr Clare would need a budget “announceable” to keep faith with higher education.

“He has built a lot of Cabinet collegial support from the prime minister down, and he’s earned considerable goodwill in the sector,” Professor Anderson told Times Higher Education. “That means they’ll want to give him something. The question is, what is the right amount that says ‘good job’, but is not so big that it detracts from what you need to do in early childhood and schools? It’s got to be in that kind of sweet spot.”

john.ross@timeshighereducation.com