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The Australian Universities Accord interim report is in, and the country may be heading in a new direction.
In early July 2023, the Australian Universities Accord Interim Report was released, outlining the country's vision for the future of its higher education system. We look at several highlights of the report and reactions to it.
By Ant Bagshaw, Senior Advisor, L.E.K. Consulting
The report proposes that government become the exemplary user of universities’ research.
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Way back in the distant past that was February 2023, I wrote for QS Insights Magazine that the Australian Universities Accord process had got the higher education sector excited about the prospect of change. With the launch of the Accord’s 152-page Interim Report, a process largely conducted behind closed doors suddenly has a public articulation, and in it we see a potential reshaping of the sector.
There are two brilliant recommendations in the report. First, there is a commitment to a massive expansion in tertiary education provision. To meet future skills needs, the system will need to double in size to 1.8m domestic students by 2050. This vision aims to make tertiary education more accessible, more equitable and more deeply ingrained in the national fabric of Australia. It paints a picture of universities as truly inclusive institutions, where individuals from diverse backgrounds can acquire essential skills and knowledge.
Second, the report proposes that government become the exemplary user of universities’ research. This suggests a future where academic knowledge is more deeply integrated into the machinery of policymaking and public service, which are essential contributors to national debate and social progress. Every taxpayer should be delighted by this ambition.
Sugar hits
In addition to a grand vision for the future of the sector for the next generation, the Interim Report proposes five immediate actions. These have already been moved in the national Parliament by Education Minister Jason Clare.
The government has promised to: “Extend visible, local access to tertiary education by creating further Regional University Centres (RUCs) and establish a similar concept for suburban/metropolitan locations.” Australia has a significant participation divide between metropolitan areas and regional, rural and remote locations. The RUCs, now known as Regional University Study Hubs (RUSH), provide infrastructure, administrative, academic and student support services without the need for creating whole new universities in communities not large enough to sustain a full-service institution.
I hadn’t anticipated that the Interim Report would challenge my assumption that institutional autonomy would remain largely untroubled.
Unwinding an unpopular policy from the previous government, the report will: “Cease the 50 percent pass rule, given its poor equity impacts, and require increased reporting on student progress.” The rule had meant that students failing half of their courses would be denied future public funding. This change removes the sanction for the student and places the burden on the institution to better enable student success.
Alongside a broader whole-of-Government approach to reconciliation with Australia’s Indigenous communities, the report proposes to: “Ensure that all First Nations students are eligible for a funded place at university, by extending demand driven funding to metropolitan First Nations students.” First Nations Australians – those from Aboriginal and Torres Strait Islander communities – make up just under 4 percent of the total population, around a million people, but the principle of open access to higher education for Indigenous people is hugely important and a part of “closing the gap” in experiences and outcomes for this group.
The sector will always be pleased with funding certainty, and the Interim Report offers that, in the short term at least, with a commitment to: “Provide funding certainty, through the extension of the Higher Education Continuity Guarantee into 2024 and 2025, to minimise the risk of unnecessary structural adjustment to the sector. Interim funding arrangements must prioritise the delivery of supports for equity students to accelerate reform towards a high equity, high participation system.” The potential for changes to funding arising from the Universities Accord means that universities will need to manage the transition, and so the guarantee of continuity of funding in 2025 provides welcome relief.
Finally, the report also proposes nudging changes to universities governance with a recommendation that: “Through National Cabinet, immediately engage with state and territory governments and universities to improve university governance, particularly focusing on: universities being good employers; student and staff safety; membership of governing bodies, including ensuring additional involvement of people with expertise in the business of universities.” Universities in Australia were established by their local State or Territory parliaments, with the exception of the Australian National University, and so the mechanism for seeking governance reform has to be through the local overseeing organisations. This recommendation has some vagaries, given the limited levers of the federal government, but the intent of reform is clearly signalled.
For the policy watchers, the interesting part is how the sector’s leaders and institutions will respond to this change in direction.
This set of tactical actions shows the broad direction of the Accord with a strong emphasis on equitable access plus positive outcomes, and that public-purpose universities will be the vehicle for delivery of the government’s broad aims. While it might be straightforward to consider each policy idea in turn, the most interesting piece comes from looking at the patterns and themes in the report.
Who needs autonomy?
In ”Don’t look back at Augar”, I said somewhat uncritically of universities, that: “The autonomy of institutions means that governments have more limited levers to effect change than in the schools system or another more centrally controlled area.” I hadn’t anticipated that the Interim Report would challenge my assumption that institutional autonomy would remain largely untroubled by the Accord process. For me, this marks the starkest contrast between the Labor Government’s approach to higher education and its predecessor’s.
Andrew Norton, a seasoned higher education commentor, said of the report that at least 25 “proposals would reduce the scope of university-level decision making or are new reporting requirements that set universities up for future regulation… these cover general mission direction, student admissions, the mix of disciplines and courses, curriculum and teaching, use of funds, and accountability.” The theme runs throughout the document.
At the heart of the Interim Report is a coherent and coordinated shift from a more market-oriented system to one of central planning with increased government oversight and control. From first principles, we should all be able to agree that there is no perfect way to organise a national higher education system: they all have faults. Marketised higher education has many critics. For the policy watchers, the interesting part is how the sector’s leaders and institutions will respond to this change in direction.
Yes, Minister
On the surface, the sector's leaders have publicly supported the Report's direction. While this outward positivity could be viewed as a strategic necessity - after all, resisting the tide of change might not be favourable - there is also genuine recognition of some of the opportunities that this shift in sector design might bring. Regional university leaders – those whose institutions have found the marketised system most challenging to navigate – have been some of the most vocal supporters of the proposed changes.
A few commentators have also emphasised the quality of the report itself, and it is indeed an impressive, and substantial, artefact of policymaking. The chair of Universities Australia, David Lloyd, said: “The detail, depth and quality of the work underscores the importance of the tertiary education system in building a stronger Australia. Clear and constructive consideration has been given to deeper reforms around widening participation, future funding for core teaching, and support for research activities and infrastructure.”
The government thinks that Australians will be better off if their universities have less flexibility.
For the policy watchers, the interesting part is how the sector’s leaders and institutions will respond to this change in direction.
However, it's essential to acknowledge the concerns which the shift to greater government control are raising. This system design will not be universally embraced, particularly among institutions that have prospered under the market-oriented paradigm. These universities – typically the largest and most research-intensive in the biggest cities – might perceive the shift as a potential encroachment on their autonomy and their capacity to innovate. Reconciling these concerns with the broader goals of the Accord will be one of the crucial challenges as the policy review process proceeds. It will take deft work to design a system which enables both metropolitan and regional universities to achieve success.
In the coming months, the Accord will be subject to further rounds of consultation. These will provide critical opportunities for universities to articulate their viewpoints and engage in constructive dialogue. Whatever the final outcome, the Interim Report has set the stage for a potential transformation in the sector - a shift that could bear profound implications for universities and the nation.
What’s next?
The most likely outcome of the Accord process remains little change in the sector. That’s because, while there are many things that could – perhaps should – be fixed, the sector is largely in good health. It’s also possible to make adjustments to the system within the current funding and regulatory architecture and so the full weight of a major review may not be necessary.
While it’s prudent to be cautious about how far and fast change might go, it’s most useful for the sector to understand the government’s thinking on how best the sector might serve national interests. The direction is clear: the government thinks that Australians will be better off if their universities have less flexibility and are subject to increased central planning.
There are many goods reasons for the positive responses from the sector. While this is smart politics, it’s also about recognising that the sector will benefit from the immediate actions proposed in the report. With more time to go in the Universities Accord policy process, and more rounds of consultation with the sector, there are further opportunities to refine the ideas and recommendations. The Interim Report signals a change in direction, but we don’t yet know the final destination.