Dr Coral Dow and Carol Kempner, Social Policy Section
Structural reform of the tertiary education sector will be
required to meet targets for higher level qualification attainment,
part of the national push for a more highly qualified population to
meet the demands of the modern economy.
The Australian Government aims to have:
- 40 per cent of 25 to 34 year olds with a degree by 2025
- 20 per cent of higher education enrolments from people of low
socio-economic status (SES) backgrounds by 2020.
COAG has set targets to double the number of people with diploma
and advanced diploma qualifications by 2020.
Higher education funding and reforms
Structural and funding reforms to meet these targets is
partially underway in the higher education sector through the Rudd
Government’s response to the major review of
Australia’s higher education system chaired by Professor
Denise Bradley in 2008. The Rudd Government accepted a substantial
number of the Review’s recommendations including deregulating
the allocation of university places through a demand-driven
entitlement system for domestic students (sometimes referred to as
a voucher system); changing the indexation rate of university
funding; increasing funding aimed at improving low SES
participation; and, establishing a new Tertiary Education Quality
and Standards Agency (TEQSA). Further legislation will be required
to enable the full implementation and funding of the reforms with
the demand driven system due to commence in 2012.
Adequate funding is an ongoing issue with the Rudd Government
rejecting a Bradley Review recommendation to increase the base
funding for teaching and learning by 10 per cent from 2010.
Universities argue that public funding to higher education as a
share of GDP should be increased to the OECD average by 2020 (about
1 per cent of GDP compared with 0.58 per cent for Australia in
2009–2010). The gap left by inadequate public funding has
been filled by a cross subsidy from overseas students who in 2008
provided 15.5 per cent of university total revenue. However, there
are indications of a downturn in international student enrolments
and an increase in domestic demand. Modelling of demographic trends
and participation rates suggests that the 40 per cent target of 25
to 34 year olds with a degree could be reached by 2015 and that an
additional 450 000 domestic students will be enrolled by 2030.
Such growth will exert pressures on university revenue,
infrastructure and staffing to the extent that it is predicted that
more than 20 new universities and 26 000 extra academic staff
may be needed over the next 30 years if it were left to the
university sector alone. Delivery of higher education through the
vocational education and training (VET) sector is therefore
considered a viable alternative to meeting these targets and
relieving the pressure on universities particularly as Technical
and Further Education (TAFE) campuses are more widely distributed
in outer metropolitan and regional locations. This will be
important in improving access and participation rates of regional
and remote students who remain seriously under represented in
higher education.
The role of the VET sector
The VET sector has traditionally been regarded as the sector of
trades and skills training but there is an overlap between the two
sectors in the delivery of Diploma, Advanced Diploma, Graduate
Diploma, and Graduate Certificate courses. Since 2003 the sector
has also provided undergraduate education. Initially TAFE
institutions, mainly in Victoria, offered degrees in disciplines
unavailable in universities. However, TAFEs now offer degrees in
vocationally orientated courses such as nursing and business that
are also offered at universities. Further expansion is likely with
the recent decision to enrol undergraduates in the NSW TAFE
system.
This ‘blurring’ of the sectors is further pronounced
by VET provision through five ‘dual sector’
universities that evolved from technical colleges; universities
offering diploma courses as bridging courses for degrees;
universities offering degrees through TAFEs as third party
providers; and a number of private providers delivering both VET
and higher education.
The Bradley Review made recommendations aimed at integration and
improved articulation of the sectors but there are major
administrative and organisational barriers which prevent this
‘blurring’ evolving into an integrated tertiary sector.
These barriers include differences in funding, regulatory
frameworks, governance, curriculum development and staffing.
Overcoming these barriers may also prove difficult whilst some
parts of the higher education sector wish to preserve universities
as the main providers of bachelor education within the broader
framework of teaching and research.
Unlike higher education, VET reform is mainly in the hands of
the state and territory governments. The Howard and Rudd
Governments, in their own different ways, have supported
competitive market reforms in VET. The Rudd Government also
advanced the development of a national VET regulator. These reforms
are influencing change in the way that state and territory TAFEs
operate in the system.
However, owing to the split in responsibilities for funding the
two sectors—the Commonwealth funding higher education and the
states funding VET—the funding of student places is a major
anomaly. The student demand driven system, due to be implemented in
universities in 2012 with a guarantee that the Commonwealth will
fund all Commonwealth Supported Places (previously HECS places)
that universities offer, is not being extended to higher level
course enrolments in TAFEs and other VET institutions.
The higher education funding model of cost sharing between
government and individuals (supported by income contingent loans)
is relatively new to the VET sector. The sector is still highly
dependent on government funds which account for 75 per cent of its
revenue as student fees account for only 4.5 per cent. However,
since 2007, Commonwealth government income contingent loans have
been made available to those studying at the Diploma level or above
in state VET systems. Only available for full-fee courses in the
first instance, they were extended to government subsidised
students in Victoria to reward that state for its competitive
market reforms. In the 2010–11 Commonwealth Budget they have
been offered as a ‘national entitlement to a quality training
place’ in all states who undertake such reforms. As tapping
these private sources of income offers VET the best prospect for
financing more training places, it is likely to prove a powerful
force for bringing about reform in VET institutions, particularly
in the state run TAFEs.
Library publications and Key documents
F Beddie and P Curtin (eds), The future of
VET: A medley of views, National Centre for Vocational
Education Research (NCVER), Adelaide, 2010, http://www.ncver.edu.au/publications/2284.html
Group of Eight, ‘Future demand for higher
education in Australia’, Go8 Backgrounder, no. 10,
Canberra, June 2010,
http://www.go8.edu.au/storage/go8statements/2010/go8backgrounder10_HE_demand.pdf
Review of Australian Higher Education,
Final report, (Professor Bradley, Chairperson), Department
of Education, Employment and Workplace Relations, Canberra,
December 2008,
http://www.deewr.gov.au/HigherEducation/Review/Pages/ReviewofAustralianHigherEducationReport.aspx
G Moodie, L Wheelahan, S Billett and A Kelly,
Higher education in TAFE: research overviews, NCVER,
Adelaide, 2009, http://www.ncver.edu.au/publications/2189.html