Universities offered little in eve-of-election Australian budget

Australian universities have received next to nothing in a hurriedly assembled federal budget handed down just before the country is due to hold a general election.

Students, graduates and university staff stand to benefit from a raft of measures to address cost-of-living pressures, if the Labor government wins the forthcoming poll. They include across-the-board tax cuts and the previously announced commitment to waive 20 per cent of accrued student debt.

Students could also benefit from a A$10.5 million (£5.1 million) expansion to scholarship schemes for nurses and midwives and a A$24.7 million Indigenous mental health initiative that includes scholarships for up to 150 psychology students.

But the budget offered almost no direct assistance to a sector reeling from mounting compliance costs, an international education crackdown and the lingering effects of Covid-19, generation-high inflation and the Job-ready Graduates (JRG) changes to fees and teaching subsidies.

Universities Australia said the focus on living costs was welcome “when many are doing it tough”. But chief executive Luke Sheehy said the budget was a “missed opportunity” to fund Universities Accord initiatives.

“With universities expected to educate a million extra students each year by 2050, now is the time to back the institutions that are critical to building our future,” he said.

Sheehy said JRG had “unfairly altered” students’ fees and reduced funding for universities when they were expected to absorb more students. “It’s time for the JRG package to go.”

Innovative Research Universities executive director Paul Harris said the JRG was the “education elephant in the room” and its reform should be prioritised ahead of debt relief. “The primary driver of student debt is the cost of doing a degree and these costs are still rising.”

The government says the debt relief measures will remove A$16 billion from 3 million student loan accounts, while raising the loan repayment earnings threshold by over A$12,500 to A$67,000. However, these initiatives received no mention in the main budget measures summary document, as they are considered “off-budget”.

Independent Higher Education Australia said they also failed to resolve “systemic inequity” in the sector because students at non-public institutions attracted a 20 per cent loan fee.

The budget includes a promise to establish additional university study hubs but allocates no money for them, with the cost to be met from the Department of Education’s existing resources.

Arguably the biggest item for the higher education sector is a A$48.2 million allocation to bankroll 500 additional medical places and uncap medical degrees for indigenous students. In vocational education,100,000 fee-free places will be funded each year in public TAFE colleges.

But a budget forecast that net overseas migration (NOM) will recede to 225,000 a year from 2026-27 appears to rely on skyrocketing departures of students and temporary graduates, according to migration expert Abul Rizvi.

“Government policy is to try and increase such departures but at this stage, the students and temporary graduates don’t want to leave,” he said. “They are doing all they can to stay and find a pathway to permanent residence.”

Rizvi said Treasury appeared to assume that the number of people coming into Australia on student visas would stabilise at about 200,000 a year, down from a peak of 278,000 two years ago. The overall NOM forecast would require around 115,000 students to leave Australia permanently each year. Last year, only 30,000 students left Australia for good, he said.

john.ross@timeshighereducation.com