23
April 2021
PDF version [531KB]
Dr Hazel Ferguson
Social Policy Section
Contents
Introduction
Funding approval for higher education
providers
Key programs
The Commonwealth Grant Scheme
Table 1: funding clusters, maximum
student contribution amounts, and Commonwealth contribution amounts, 2021
Provider payments
Eligibility
Allocations
Additional loadings
The Higher Education Continuity
Guarantee
Indexation. 8
Table 2: CGS indexation arrangements,
2021–24
Performance funding
Student eligibility
Courses not funded through the CGS
Student loans
HECS-HELP
FEE-HELP
SA-HELP
OS-HELP
Indigenous student assistance grants
Other grants
Indigenous, Regional and Low
Socio-Economic Status (SES) Attainment Fund
National Priorities and Industry
Linkage Fund
Regional University Centres
Higher Education Disability Support
Program.. 14
Funding trends
Table 3: estimated Australian
Government expenditure on higher education, 2009–10 to 2023–24
Figure 1: estimated Australian
Government expenditure on higher education, 2009–10 to 2023–24
Table 4: university revenue from
continuing operations, 2009, 2014 and 2019
Further information
Appendix 1: listed providers in HESA
at March 2021
Appendix 2: key higher education
funding program eligibility under HESA at March 2021
Appendix 3: key legislative references
for higher education funding programs under HESA at March 2021
Introduction
Australia’s higher education system
provides education for approximately
1.6 million students (in 2019) through 186 registered higher
education providers, including 40 Australian universities.[1]
The Australian Government is the primary funder and regulator of the system.
In 2020, the sector experienced two significant funding challenges.
First, COVID-19 travel restrictions disrupted entry for overseas students,
leading to a 5.1 per cent decline in enrolments, and a 23.2 per cent decline in
commencements to December 2020, compared with December 2019.[2]
Universities Australia has estimated the resulting revenue loss for its members
in 2020 compared with 2019 was $1.8 billion, and predicts $2.0 billion losses
in 2021.[3]
Then, in October 2020, the passage of the Higher Education
Support Amendment (Job-Ready Graduates and Supporting Regional and Remote
Students) Act 2020 (JRG Act) legislated a reduction in average
per-student funding for domestic Commonwealth supported students, and other
changes to key learning and teaching funding programs from January 2021.[4]
These changes occurred against a backdrop of little real
growth in government funding in recent years, during which time universities
have increasingly relied on overseas student fees as a source of revenue
growth.[5]
The 2020–21 Budget included a one-off additional investment in higher education
research in response to COVID-19, leading to record estimated expenditure of
$11.4 billion in 2020–21.[6]
However, expenditure is expected to decline from this high over the forward
estimates. Measured in June 2020 dollars, higher education expenditure in 2023–24
is estimated to be $9.3 billion, approximately the same as it was in real terms
in 2009–10.
This paper provides an overview of key current Australian
Government funding programs and recent funding trends in higher education
learning and teaching.[7]
It aims to provide a guide to current policy settings, now that the key funding
components of the JRG Act are in effect, although considerable
uncertainty remains in relation to international education, and the effects of
COVID‑19.
University research funding is dealt with separately in University
research funding: a quick guide.[8]
Funding
approval for higher education providers
Higher education funding for learning and teaching is administered
by the Department of Education, Skills and Employment (DESE) under the Higher Education
Support Act 2003 (HESA). HESA funding is only available
to approved
providers.[9]
Only bodies registered by the national regulator, the Tertiary Education
Quality and Standards Agency (TEQSA) are eligible to be approved for
funding under HESA.[10]
At a minimum, approval under HESA will allow a
provider to access FEE-HELP
loans for eligible students to defer the cost of their course fees.[11] In
addition, a provider may be listed in HESA, in Table A, B, or C (see Appendix 1). Listed providers receive the bulk
of funding and are predominantly Australian universities founded under state
and territory legislation.[12]
Eligibility for key funding programs by category is set out in Appendix 2.
Key programs
The
Commonwealth Grant Scheme
The largest higher education funding program in terms of annual
Australian Government expenditure, estimated at $7.5
billion in 2020–21, is the Commonwealth
Grant Scheme (CGS), which subsidises course fees for eligible higher
education students.[13]
A subsidised place funded through the CGS is known as a Commonwealth
supported place (CSP).[14]
In
2019, 852,808 students studied in CSPs, equating to 627,545 full-time
places.[15]
Providers receive two payments for each CSP: a Commonwealth
contribution, paid by the Australian Government through the CGS; and a student
contribution, paid by the student, usually
through HECS-HELP.[16]
Collectively, these amounts make up ‘base funding’
for higher education.[17]
The Australian Government sets Commonwealth contribution and
maximum student contribution amounts for each unit of study (or subject)
undertaken by a student in a CSP using field
of education-based ‘funding clusters’. Table 1 below shows the 2021 funding
cluster amounts—the dollar figures refer to the contribution for a full-time
student load for a year, which is usually eight subjects across two semesters.[18]
Amounts for each cluster are published
on the DESE website and indexed
each year using the Consumer Price Index (CPI).[19]
The current base funding levels,
which came into effect from 1 January 2021, draw on an assessment of costs
of teaching and scholarship by field and level of education.[20]
Additionally, student contribution amounts are moderated based on the
Government’s assessment of the employment prospects associated with fields of
study.[21]
Table 1: funding
clusters, maximum student contribution amounts, and Commonwealth contribution
amounts, 2021
| Funding cluster |
Part of funding cluster |
Maximum student
contribution amounts |
Commonwealth contribution
amounts |
| Funding cluster 1 Law, Accounting,
Administration, Economics, Commerce, Communications, and Society and Culture |
Law, Accounting,
Administration, Economics, Commerce, Communications, Society and Culture |
$14,500 |
$1,100 |
| Funding cluster 2 Education, Clinical
Psychology, English, Mathematics, Statistics, Allied Health, Other Health,
Built Environment, Computing, Visual and Performing Arts, Professional
Pathway Psychology, and Professional Pathway Social Work |
Education, Clinical Psychology(a),
English, Mathematics, Statistics |
$3,950 |
$13,250 |
| Allied Health, Other
Health, Built Environment, Computing, Visual and Performing Arts,
Professional Pathway Psychology(b), Professional Pathway Social
Work(c) |
$7,950 |
| Funding cluster 3 Nursing, Indigenous and
Foreign Languages, Engineering, Surveying, Environmental Studies, Science |
Nursing, Indigenous and
Foreign Languages |
$3,950 |
$16,250 |
| Engineering, Surveying,
Environmental Studies, Science |
$7,950 |
| Funding cluster 4 Agriculture, Medicine,
Dentistry, Veterinary Science, Pathology |
Agriculture |
$3,950 |
$27,000 |
| Pathology |
$7,950 |
| Medicine, Dentistry,
Veterinary Science |
$11,300 |
(a) Postgraduate Clinical Psychology units are
psychology units of study that contribute to courses of study that are
accredited for the purposes of professional registration by the Australian
Health Practitioner Regulation Agency (AHPRA) and which lead to Endorsed Areas
of Practice in Clinical Psychology, Clinical Neuropsychology, Counselling
Psychology, Educational and Developmental Psychology, Forensic Psychology,
Health Psychology, Sports Psychology and Community Psychology.
(b) Professional Pathway Psychology units of study are
Behavioural Science units that contribute to courses of study that lead to a
bachelors degree, honours degree or masters degree in psychology with a course
structure that makes it compulsory to study the units relevant to professional
registration as a psychologist by the Psychology Board of Australia, and which
itself represents a pathway to professional registration as a psychologist.
(c) Professional Pathway Social Work units of study are
Human Welfare Studies and Services units that contribute to courses of study
that lead to a bachelors degree, honours degree or masters degree in social
work accredited by the Australian Association of Social Workers (AASW).
Source: Parliamentary Library based on Department of
Education, Skills and Employment (DESE), 2021 allocation of units of study to funding clusters, DESE website, last modified 17 March 2021.
Provider payments
Eligibility
Most CGS funding (covering Commonwealth contributions) is
only available to Table A providers, although other providers listed in the Commonwealth Grant
Scheme Guidelines are eligible for ‘national priorities’ funding,
predominantly for Education and Nursing courses.[22]
In order to receive CGS funding, a provider must enter into
a funding
agreement with the Australian Government—these agreements set out the
details of CGS funding for each provider.[23]
Allocations
A provider’s total CGS grant is capped using the following
mechanisms:
- Table A providers:
- receive
a specific allocation for any CSPs in ‘designated courses’ (currently only Medicine)
- receive
uncapped funding for ‘demand driven courses’ (currently only bachelor or
honours degrees undertaken by Indigenous people from regional or remote areas)
- may
enrol students in any combination of ‘higher education courses’ (all
non-designated and non-demand-driven courses) up to a maximum basic grant
amount (MBGA) and
- non-Table A providers receiving CGS funding have all CSPs
specifically allocated.[24]
The MBGA and any allocated CSPs are set out in the funding
agreement.[25]
The funding agreements may also (but do not currently) include a MBGA for
designated and/or demand driven courses for Table A providers.[26]
In practice, since most
courses will be higher education courses at Table A providers, this means the
Government does not precisely determine how many CSPs are funded each year.
Each Table A provider determines the mix of courses offered up to the MBGA, and
the number of students funded within a given MBGA can vary considerably. For
example, the 2021 Commonwealth contribution amount of $27,000 for one
commencing full-time Agriculture student could fund approximately 25 full-time
commencing Law students, which attract a Commonwealth contribution of $1,100.
Additional
loadings
On top of per-place funding, two loadings, calculated
according to the Commonwealth
Grant Scheme Guidelines, are currently provided:
- a ‘medical student loading’ of $1,465 per place (indexed) is
provided based on the number of equivalent full-time medical student places the
provider has and
-
in 2021, 2022 and 2023, a ‘transition fund loading’ for Table A
providers and the University of Notre Dame Australia is provided to offset
certain funding reductions caused by the JRG Act.[27]
The Higher
Education Continuity Guarantee
A Higher Education Continuity Guarantee (HECG) has also been
introduced for 2021, 2022 and 2023 to assist with recovery from the COVID-19
pandemic.[28]
The HECG is a grant under the Other Grants
Guidelines (Education) 2012, which will fund any gap between the providers’
MBGA for higher education courses and designated courses, and the number of
students they are able to enrol.[29]
This means ‘under-enrolled’ providers will receive their MBGA, regardless of
the number of students they enrol.[30]
From 2024, providers will be funded only for enrolled
students up to their MBGA.[31]
Indexation
There is no requirement in HESA for a provider’s
total CGS grant to be indexed. This leaves open the possibility that as student
and Commonwealth contributions increase due to indexation and total CGS funding
remains static, the number of fully funded CSPs (except in demand driven
courses) will decline over time.
However, current policy is to fund additional places based
on the remoteness (as identified in the Australian
Statistical Geography Standard (ASGS) classification) and population growth
(based on the population
projections published by the Australian Institute of Health and Welfare) of
a given campus location, as shown in Table 2 below.[32]
A list of campus classifications (at 2020) is available from the DESE Technical
Note for Job-ready Graduates Package.[33]
Table 2: CGS
indexation arrangements, 2021–24
| Category |
2021 |
2022 |
2023 |
2024 |
| Regional (inner
regional, outer regional, remote and very remote) |
1.3% |
2.3% |
3.0% |
3.5% |
| High population growth
metropolitan |
0.9% |
1.6% |
2.1% |
2.5% |
| Low population growth
metropolitan |
0.4% |
0.6% |
0.8% |
1.0% |
Source: Parliamentary Library based on DESE, Technical note for Job-ready Graduates Package, DESE, Canberra, 24 June 2020, p. 4.
Performance
funding
A proportion (increasing each year from 2021, up to 7.5 per cent)
of the MBGA for higher education courses for Table A providers is contingent on
meeting performance-based
funding requirements. This requirement is set out in providers’ 2021–2023
funding agreements.
Performance measures have so far included graduate
employment outcomes, student experience, student success and equity group
participation by Indigenous, low socio‑economic
status and regional/remote students, although at the time of writing
arrangements for 2021 have not been finalised.[34]
Reviews in 2020 and 2023 were planned to ensure the program is ‘fit for
purpose’.[35]
Student
eligibility
Australian citizens, New Zealand citizens, and permanent
visa holders who will be in Australia for the entire duration of their course,
are eligible to enrol in a CSP.[36]
Generally, an eligible student who is admitted to an
undergraduate course of study must be enrolled in a CSP, unless they advise
their provider that they do not wish to be a Commonwealth supported student, or
their provider is not eligible to provide a CSP for the course.[37]
In practice, this means Table A providers are generally not able to enrol
undergraduate students on a full fee‑paying basis, while other providers
can do so if they do not have an allocated CSP available for the course.
There are several exceptions to the requirement to offer an
eligible undergraduate student a CSP, such as courses undertaken primarily at
an overseas campus, and bridging courses for overseas trained professionals.[38]
However, the
DESE higher education student statistics show most undergraduate students
receive CSPs. For example, in 2019 only 35,332 domestic bachelor students were
full fee-paying, compared with 740,168 who were in CSPs.[39]
In combination with the MBGA for higher education courses,
the requirement to offer eligible undergraduate students CSPs can be considered
a soft cap on the available number of undergraduate places. There is nothing in
HESA to prevent Table A providers from offering CSPs for higher
education courses above the MBGA (that is, ‘over-enrolling’), but they receive
only the student contribution for these places.
Courses not
funded through the CGS
A range of different fee arrangements apply to courses not
funded through the CGS:
- Overseas students (that is, those studying on a student visa) are
not eligible for support through the CGS.[40]
Non-research undergraduate and postgraduate courses for overseas students are
offered on a full fee-paying basis (although fees are sometimes covered by a
scholarship, including Australian Government programs such as the Australia
Awards Scholarships).[41]
- Postgraduate research courses (masters by research and doctorate
by research) are not funded through the CGS. The Research
Training Program (RTP), which is part of the Research Block Grants,
provides full-fee offsets for both domestic and overseas students, although only
10 per cent of RTP funding may be spent on overseas students.[42]
Students not receiving an RTP fee offset, or who take longer than four years
full-time (or part-time equivalent) to complete a doctorate and two years
full-time (or part-time equivalent) to complete a masters may be charged full
fees.[43]
- Postgraduate coursework degrees for domestic students can be funded
through the CGS. However, unlike most undergraduate degrees, there is no
requirement that eligible postgraduate students be offered a CSP. These courses
can therefore be offered on a full fee-paying basis. If full fees are charged,
there is no Commonwealth subsidy or cap on fees that can be charged to the
student.
-
Providers that are not funded through the CGS (or that have only
certain courses funded) may offer their undergraduate and postgraduate courses
to domestic students on a full fee-paying basis.
Student
loans
The Higher
Education Loan Program (HELP) provides loans to students to defer certain
study costs, mainly student contributions (for those in CSPs) and tuition fees.
There are four HELP sub-schemes for different fee types, as summarised below.[44]
The Australian Government pays amounts directly to the provider on behalf of
the student.
A HELP
loan limit applies to a person’s total HELP borrowing at any one time (as well
as borrowing by vocational education and training (VET) students through VET
Student Loans, and the precursor to VET Student Loans, VET FEE-HELP).[45]
In 2021, the limit is $155,448 for Medicine, Dentistry and Veterinary Science courses
leading to initial registration, or eligible Aviation courses, and $108,232 for
all other courses.[46]
On 1 June each year, any outstanding HELP debt that has
remained unpaid for at least 11 months (taking into consideration any
repayments, additional debts, or other adjustments) is adjusted in line with
changes in the CPI.[47]
Generally, this means unpaid debts will increase each year (although
they can also fall) in line with inflation.[48]
Once a borrower’s repayment income reaches a minimum
repayment threshold, they are required to make repayments through the
Australian Taxation Office. Repayment rates depend on a person’s income.[49]
In 2020–21, the minimum repayment threshold is $46,620, and repayment rates
range from 1.0 per cent (at $46,620 to $53,826) to 10 per cent at $136,740 and
above.[50]
In
2019, Commonwealth supported students incurred approximately $4.7 billion
of HELP debt, and full fee-paying students incurred approximately $1.6 billion
of HELP debt.[51]
Total
outstanding debt was approximately $66.4 billion in 2019–20.[52]
Students can choose to pay fees up-front rather than using
HELP, although relatively few do so. In
2019, Commonwealth supported students paid $493.2 million up-front, while
domestic fee-paying students paid $41.5 million.[53]
HECS-HELP
- Australian citizens and permanent humanitarian visa holders
enrolled in a CSP are eligible to defer the cost of their student contribution
amount using HECS-HELP,
the replacement for the original Higher Education Contribution Scheme (HECS).[54]
As outlined above, the maximum
student contribution is set by the Government, and varies according to
field of study.
- In
2019, 827,877 people received HECS-HELP assistance.[55]
FEE-HELP
- Australian citizens and permanent humanitarian visa holders
enrolled in full fee-paying places at approved higher education providers are
eligible to defer the cost of their fees using FEE‑HELP.[56]
- FEE-HELP is also available to other permanent visa holders and New
Zealand Special Category Visa holders to defer the cost of bridging
courses.[57]
- Currently, using FEE-HELP to pay for an undergraduate course at a
non-university higher education provider or overseas (Table C) university
incurs a 25 per cent loan fee, which does not count towards the HELP loan limit,
but is added to the person’s total outstanding debt. The fee will be reduced to
20 per cent from 1 July 2021.[58]
- In
2019, 139,439 people received FEE-HELP assistance.[59]
SA-HELP
- Australian citizens and permanent humanitarian visa holders can
use SA-HELP to defer
the cost of the student
services and amenities fee (SSAF), which covers certain student services
and amenities of a non-academic nature. In 2021, the SSAF was up to $313 per
student.[60]
- In
2019, 534,132 people received SA-HELP assistance.[61]
OS-HELP
- Australian citizens and permanent humanitarian visa holders
enrolled in an undergraduate CSP can defer the cost of certain overseas study
expenses using OS-HELP.[62]
- The student’s provider pays the loan amount to the student, who
can use the amount to pay airfares, accommodation or other travel costs.[63]
- Two OS-HELP loans can be taken out over a lifetime (but only one
in any six-month period). In 2021, $8,444 could be borrowed for study in Asia,
plus $1,123 for preparatory Asian language study, or $7,037 for other
destinations.[64]
- In
2019, 16,661 people received OS-HELP assistance.[65]
Indigenous
student assistance grants
HESA makes specific provisions for Indigenous student
assistance, which is currently delivered through the Indigenous
Student Success Program (ISSP), administered by the National Indigenous Australians Agency.[66]
Table A and Table B providers are eligible for ISSP funding,
which they can use to provide scholarships, tutorial assistance, mentoring,
safe cultural spaces and other personal support services—each provider
determines the mix of services best suited to their students.[67]
In order to receive funding, the Indigenous Student
Assistance Grants Guidelines 2017 require providers to:
- have at least five Indigenous students (measured in equivalent
full-time student load)
- have access to other (non-ISSP) funding that they intend to use
to assist Indigenous students to: undertake higher education; increase the
number of Indigenous students enrolling in, progressing in and completing
courses; and increase the number of Indigenous students participating in higher
education and
- have, or put in place: an Indigenous Governance Mechanism; an
Indigenous Workforce Strategy; and an Indigenous Education Strategy.[68]
In
2021, $72.3 million in funding was available through the ISSP.[69]
Funding was distributed between providers according to the method in the Grant
Guidelines, which is based on Indigenous enrolments, success rate, and
completion rate.[70]
A loading is also applied for Indigenous students from regional and remote
areas.[71]
Other grants
Various supplementary grant programs are also funded under HESA
to support higher education learning and teaching.[72]
These ‘other grants’ can be for any one of 14 purposes set out in section
41-10, including equality of opportunity, capital development projects, and
activities that assure and enhance the quality of the sector.
Eligibility for a grant depends on the purpose, with all
grants available to Table A providers, many extended to Table B providers, and
some extended to bodies corporate that are specified in the Other Grants
Guidelines (Education) 2012.[73]
An overview of key ‘other grants’ programs is provided
below. Smaller grants, one-off investments, and research funding, including the
Research
Support Program (which is part of the Research Block Grants,
along with the RTP), have been omitted.
Indigenous,
Regional and Low Socio-Economic Status (SES) Attainment Fund
The Indigenous, Regional and Low SES Attainment Fund
(IRLSAF) was announced in 2020 as part of the Job-ready Graduates Package.[74]
It combines existing equity funding from the Higher Education Participation and
Partnerships Program (HEPPP) as well as the enabling loading and regional
loading (discussed further below), which previously formed part of the CGS.[75]
From 2021 to 2023, IRLSAF funding will be made up of:
- the HEPPP, which will distribute $138.0 million (indexed) per
year, based on a provider’s share of domestic undergraduate students from a low
SES background, regional areas and remote areas, and Indigenous students, with
the aim of improving access and participation among these groups
-
the National Priorities Pool Program, which will distribute $6.5
million (indexed) per year in the form of grants to support research, trials
and implementation initiatives that aim to improve equity policy and programs
- the Regional Partnerships Project Pool, which will distribute
$1.8 million (indexed) per year in the form of grants for collaboration between
higher education providers and schools, and vocational education and training
(VET) providers and community organisations, with the aim of addressing
barriers to higher education for students from regional and remote areas
- the Regional Loading Program (RLP), which will distribute $75.1
million (indexed) per year based on the remoteness
of a provider’s campus(es) and number of CSPs and
- the Enabling Loading Program (ELP), which will provide $3,392
(indexed) per enabling CSP (that is, for each CSP a provider delivers a course
designed to equip a person with the skills to undertake a higher education course),
in order to offset the cost of providers being unable to charge a student
contribution for enabling courses.[76]
Only Table A providers are eligible for all IRLSAF
components. The RLP and ELP are also provided to the University of Notre Dame
Australia.[77]
National
Priorities and Industry Linkage Fund
The National
Priorities and Industry Linkage Fund (NPILF) was announced in 2020 as part
of the Job-ready Graduates Package.[78]
From 2021, the NPILF will provide grants to universities to invest in more
innovative approaches to industry engagement, with the aim of improving
graduate employability.[79]
From 2021 to 2024, $222.0 million (indexed) will be provided
per year to Table A providers.[80]
Allocations will be based on a provider’s number of CSPs—smaller institutions
with less than 9,999 CSPs will receive $3.3 million, with increasing
amounts of $4.8 million (10,000–14,999 CSPs), $7.0 million (15,000–21,999 CSPs),
and $8.8 million (greater than 22,000 CSPs) for larger institutions.[81]
Regional
University Centres
Regional
University Centres (RUCs) provide facilities such as computers and study
spaces, and support such as study advice and academic support services, to
assist students studying at a distance from their provider.[82]
There are currently 16 RUCs, with a further nine expected to open in 2021.[83]
Eligibility for RUC funding is set out in the Other
Grants Guidelines (Education) 2012, and includes Table A and Table B
providers, any other provider allocated CSPs, a body corporate registered as a charity or not-for
profit, or any other body corporate the Minister is
satisfied has, or will have, a physical operational presence in a regional
or remote area.[84]
Higher
Education Disability Support Program
The Higher
Education Disability Support Program consists of two components:
In
2020, $7.8 million of funding was provided for both components.[86]
Only Table A providers are eligible for this funding.[87]
Funding
trends
The higher education subfunction in each year’s Budget
Paper No. 1 and the Final Budget Outcome provides an indicative
picture of higher education funding over time. This does not include all
Australian Government funding received by higher education providers. It omits
HELP—which is under the student assistance subfunction—and Australian Research
Council programs and DESE expenditure on research capacity, which are both part
of the ‘General research’ subfunction of the ‘General public services’ function.
It does, however, include the CGS, Research Block Grants, and other key
learning and teaching funding outlined above.
Table 3 below provides expenditure on higher education from
2009. Expenditure has trended upwards over the period shown but is expected to decrease
in real terms from 2020–21. However, as illustrated by Figure 1, this decrease
is from a record high in 2020–21, which is due to temporary additional research
funding provided in the 2020–21
Budget in response to the COVID‑19 pandemic.[88]
Table 3: estimated
Australian Government expenditure on higher education, 2009–10 to 2023–24
| Year |
Expenditure ($m) |
Real (June 2020 dollars) ($m) |
| 2009–10 |
7,750 |
9,255 |
| 2010–11 |
7,722 |
8,905 |
| 2011–12 |
8,533 |
9,723 |
| 2012–13 |
8,714 |
9,697 |
| 2013–14 |
8,970 |
9,690 |
| 2014–15 |
9,078 |
9,661 |
| 2015–16 |
9,581 |
10,093 |
| 2016–17 |
9,390 |
9,704 |
| 2017–18 |
9,606 |
9,725 |
| 2018–19 |
9,589 |
9,556 |
| 2019–20 |
9,652 |
9,652 |
| 2020–21 estimate |
11,373 |
11,123 |
| 2021–22 estimate |
10,570 |
10,185 |
| 2022–23 estimate |
10,184 |
9,644 |
| 2023–24 estimate |
10,060 |
9,340 |
Note:
real funding has been calculated by the Parliamentary Library by deflating the
nominal expenditure figure by the June quarter CPI and CPI forecasts from the
2020–21 Mid-Year Economic and Fiscal Outlook, this methodology may differ to
that presented in the Budget papers. Figures are in 2019–20 dollars, the last
available year of actual figures.
Sources: Parliamentary
Library based on Australian Government, Budget strategy and outlook: budget paper
no. 1: 2020–21;
Australian Government, Final budget outcome,
various years.
Figure 1: estimated
Australian Government expenditure on higher education, 2009–10 to 2023–24
Note:
real funding has been calculated by the Parliamentary Library by deflating the
nominal expenditure figure by the June quarter CPI and CPI forecasts from the
2020–21 Mid-Year Economic and Fiscal Outlook, this methodology may differ to
that presented in the Budget papers. Figures are in 2019–20 dollars, the last
available year of actual figures. (e) means that figures are budget estimates.
Sources: Parliamentary
Library based on Australian Government, Budget strategy and outlook: budget paper
no. 1: 2020–21;
Australian Government, Final budget outcome,
various years.
The DESE Finance
Publication, based on university financial reporting, provides a more
detailed picture of university finances. Table 4 below shows that as nominal
funding from Australian Government sources increased from $11.4 billion in 2009
to $17.8 billion in 2019, share of total university revenue from the Australian
Government declined from 55.8 per cent in 2009 to 48.7 per cent in 2019.
This was largely due to the increased percentage of revenue sourced from fees
and charges, most notably overseas student fees. When the 2020 Finance
Publication is released towards the end of 2021, the impact of the COVID-19
pandemic is expected to show substantially reduced overseas student fee
revenue, which is likely to shift the balance between government and non-government
sources again.
Table 4:
university revenue from continuing operations, 2009, 2014 and 2019
|
2009 |
2014 |
2019 |
|
$bn |
% of total |
$bn |
% of total |
$bn |
% of total |
| Australian
Government Financial Assistance |
11.42 |
55.8 |
16.12 |
58.1 |
17.78 |
48.7 |
| Commonwealth Grants Scheme and
Other Grants |
4.72 |
23.1 |
6.75 |
24.3 |
7.47 |
20.5 |
| Scholarships |
0.27 |
1.3 |
0.30 |
1.1 |
- |
- |
| Departmental Research Grants |
1.14 |
5.6 |
1.42 |
5.1 |
1.91 |
5.2 |
| Education Investment Fund and Other
Capital Funding |
0.57 |
2.8 |
0.24 |
0.9 |
0.03 |
0.1 |
| Australian Research Council |
0.56 |
2.7 |
0.86 |
3.1 |
0.62 |
1.7 |
| Other Australian Government
Financial Assistance |
1.38 |
6.7 |
1.71 |
6.2 |
1.95 |
5.3 |
| Australian Government Student Loan
Payments(a) |
2.78 |
13.6 |
4.84 |
17.4 |
5.81 |
15.9 |
| State and
Local Government Financial Assistance |
0.78 |
3.8 |
0.57 |
2.1 |
0.73 |
2.0 |
| Fees, Charges,
and Upfront Student Contributions(b) |
5.17 |
25.2 |
6.91 |
24.9 |
12.25 |
33.5 |
| Other
Income(c) |
3.10 |
15.1 |
4.15 |
15.0 |
5.76 |
15.8 |
| Total
Revenues from Continuing Operations(d) |
20.47 |
100.0 |
27.75 |
100.0 |
36.52 |
100.0 |
Notes:
(a). Includes HECS-HELP, FEE-HELP, VET FEE-HELP, VET
Student Loans, and SA-HELP.
(b). Includes upfront student contributions, continuing
education, fee paying overseas students, fee paying non-overseas postgraduate
students, fee paying non-overseas non-award students, other domestic course
fees and charges, student services and amenities fees, and other fees and
charges. Revenue from fee paying overseas students accounts for the majority of
the total.
(c). Includes investment income, royalties, trademarks
and licenses, share of net result, consultancy and contracts, donations and
bequests, scholarships and prizes, non-government grants, net gain on disposal
of property, plant and equipment, net foreign exchange gains, and other
revenue.
(d). Percentages may not add to 100 due to rounding.
Source: Parliamentary Library based on DESE, Finance publication, DESE, various years.
Further
information
- C Ey, The
Higher Education Loan Program (HELP) and related loans: a chronology,
Research paper series, 2020–21, Parliamentary Library, Canberra, 23 March 2021.
- H Ferguson, Tertiary
education: a quick guide to key internet links, Research paper series, 2020–21,
Parliamentary Library, Canberra, 7 January 2021.
- H Ferguson, University
research funding: a quick guide, Research paper series, 2020–21,
Parliamentary Library, Canberra, 8 January 2021.
- H Ferguson, ‘Updated
Higher Education Loan Program (HELP) debt statistics: 2019–20’, FlagPost, Parliamentary
Library blog, 30 October 2020.
- H Ferguson and H Spinks, Overseas
students in Australian higher education: a quick guide Research paper
series, 2020–21, Parliamentary Library, Canberra, 22 April 2021.
- Payments to providers can be found in the departmental
determinations.
- Funding agreements for each higher education provider can be found
at DESE, ‘Higher
education providers’ 2021–2023 funding agreements’, DESE website, n.d.
Appendix 1:
listed providers in HESA at March 2021
| Table A providers |
| Central Queensland University |
| Charles Darwin University |
| Charles Sturt University |
| Curtin University |
| Deakin University |
| Edith Cowan University |
| Federation University Australia |
| Flinders University |
| Griffith University |
| James Cook University |
| La Trobe University |
| Macquarie University |
| Monash University |
| Murdoch University |
| Queensland University of Technology |
| Royal Melbourne Institute of Technology |
| Southern Cross University |
| Swinburne University of Technology |
| The Australian National University |
| The University of Adelaide |
| The University of Melbourne |
| The University of Queensland |
| The University of Sydney |
| The University of Western Australia |
| University of Canberra |
| University of Newcastle |
| University of New England |
| University of New South Wales |
| University of South Australia |
| University of Southern Queensland |
| University of Tasmania |
| University of Technology Sydney |
| University of the Sunshine Coast |
| University of Wollongong |
| Victoria University |
| Western Sydney University |
| Australian Catholic University |
| Batchelor Institute of Indigenous Tertiary Education |
| Table B providers |
| Bond University |
| The University of Notre Dame Australia(a) |
| University of Divinity |
| Torrens University Australia |
Note:
(a) The Mid-Year Economic and Fiscal Outlook 2020–21, (p. 151) announced that the University of Notre Dame
Australia would be recategorised as a Table A provider. At the time of writing,
this change is before Parliament in the Education Legislation Amendment (2021 Measures No. 1)
Bill 2021.
| Table C providers |
| Carnegie Mellon University, a non‑profit
organisation established under Pennsylvania law |
Appendix 2: key higher education funding program
eligibility under HESA at March 2021
| Program |
Description |
Provider eligibility |
HESA section |
| Commonwealth
Grant Scheme (CGS) |
Subsidises course fees for eligible higher education
students. |
Most CGS funding is only available to Table A providers,
although other providers listed in the Commonwealth Grant
Scheme Guidelines are eligible for ‘national priorities’ funding. |
30-1 |
| Research
Block Grants |
Funding to support university research capacity through
the Research
Training Program and Research
Support Program. |
Table A and Table B |
41-10(1) item 7 and 46-15 |
| Indigenous, Regional and Low SES Attainment Fund (IRLSAF) |
Announced in 2020 as part of the Job-ready Graduates Package,
from 2021 the IRLSAF combines existing equity funding from the Higher Education Participation and
Partnerships Program (HEPPP) as well as the enabling loading and regional
loading, which previously formed part of the CGS. |
Only Table A providers are eligible for all IRLSAF
components. The loadings which previously formed part of the CGS are also
provided to the University of Notre Dame Australia through the Other
Grants Guidelines (Education) 2012. |
41-10(1) item 1 |
| National
Priorities and Industry Linkage Fund (NPILF) |
Announced in 2020 as part of the Job-ready Graduates Package, the
NPILF will provide grants to universities from 2021 to invest in more
innovative approaches to industry engagement, with the aim of improving
graduate employability. |
Table A |
41-10(1) item 13 |
| Indigenous
Student Success Program |
Provide scholarships, tutorial assistance, mentoring,
safe cultural spaces and other personal support services—each provider
determines the mix of services best suited to their students. |
Table A and Table B |
38-10 |
| Regional University
Centres |
Provide facilities such as computers and study spaces;
and support such as study advice and academic support services, to assist
students studying at a distance from their provider. |
Under the Other
Grants Guidelines (Education) 2012, funding is available to Table A and
Table B providers, any other provider allocated CSPs, a body corporate registered as a charity or not-for
profit, or any other body corporate the Minister is satisfied has, or
will have, a physical operational presence in a regional
or remote area. |
41-10(1) item 11(c) |
| Higher
Education Disability Support Program |
Funding for the Disability Support Fund (DSF), which
allocates funding to institutions to undertake activities that assist in
removing barriers to access for students with disability; and funding to
maintain the Australian Disability
Clearinghouse on Education and Training, currently hosted by the
University of Tasmania. |
Table A |
41-10(1) item 1 |
| HECS-HELP |
Student loan for eligible Commonwealth supported students
to pay their student contributions. |
Table A, and other providers with places in ‘national
priority areas’ for the student’s course. |
90-1(c) and 30-1 |
| FEE-HELP |
Student loan for eligible full fee-paying students to pay
their course fees. |
All approved providers. |
104-10(1) |
| SA-HELP |
Student loan for eligible students to pay the Student
services and amenities fee (SSAF). |
All approved providers. |
126-1 and 19‑37(5) |
| OS-HELP |
Student loan for eligible students to cover overseas
study expenses. |
Table A, and other providers with places in ‘national
priority areas’ for the student’s course. |
118-7(c) and 30‑1 |
Appendix 3: key legislative references for
higher education funding programs under HESA at March 2021
| Act reference |
Funding provision |
How determined |
| Sub-section 19-37(5) |
Student services and amenities fee (SSAF). |
Maximum amount determined in HESA. Other conditions specified in the Administration
Guidelines 2012. |
| Sub-section 30-25(3) |
Minister may enter into a funding agreement with a
provider. |
Under section 30-27, the funding agreement must specify
the MBGA available for a grant year for higher education courses at Table A
providers, but in 2021, 2022 and 2023, this amount must not be less than the
amount specified in the Commonwealth Grant
Scheme Guidelines 2020. A MBGA may also be specified for designated and demand
driven courses at Table A providers. Other providers have CSPs (and the funding associated with
them) specifically allocated in the funding agreement. |
| Section 33-10 |
Commonwealth contribution amounts and grandfathered
(pre-2021) Commonwealth contribution amounts for CSPs by funding
cluster. |
Determined in HESA. Allocation of units to funding clusters is set out and can
be amended through the Commonwealth Grant
Scheme Guidelines 2020 (section 33‑35). |
| Section 38-30 |
Indigenous Student Assistance Grants. |
The amounts and conditions are specified in the Indigenous Students
Assistance Grant Guidelines 2017, or by the Minister in a notifiable instrument. |
| Sections 41-45 and 41-50 |
Other Grants, as set out in the Higher Education
Support Act 2003 – the Other Grants
Guidelines (Education) 2012 and the Other Grants
Guidelines (Research) 2017. |
The Minister, by legislative
instrument, determines the maximum amount available for Other Grants for
each year. |
| Section 46-40 |
Commonwealth Scholarships. |
The Minister, by legislative
instrument, determines the maximum amount available for Commonwealth
Scholarships for each year. The conditions are specified in the Commonwealth
Scholarships (Research) Guidelines 2017. |
| Section 93-10 |
Maximum student contribution amounts for a CSP. |
Determined in HESA. Allocation of units to funding clusters is set out and can
be amended through the Commonwealth Grant
Scheme Guidelines 2020 (section 33‑35). |
| Section 121-5 |
Maximum amount available for OS‑HELP (overseas study
in Asia). |
Determined in HESA. |
| Section 121-10 |
Maximum amount available for OS‑HELP (overseas study
not in Asia). |
Determined in HESA. |
| Section 121-15 |
Maximum amount available for OS‑HELP (Asian language
study). |
Determined in HESA. |
| Section 128-20 |
HELP loan limit. |
Determined in HESA. |
| Section 137-10(2) |
FEE-HELP loan fee. |
Determined in HESA. |
| Section 140-25 |
HELP debt indexation. |
Determined in HESA. |
| Section 198-10 |
Indexation of the SSAF maximum amount, the Commonwealth
and maximum student contributions for CSPs, the HELP loan limit and OS‑HELP
amounts. |
Determined in HESA. |
[1]. Department of
Education, Skills and Employment (DESE), 2019
student summary tables, DESE, created 8 September 2020; Tertiary
Education Quality and Standards Agency (TEQSA), ‘Search the National Register’
TEQSA website.
[2]. DESE, Basic pivot table 2002 onwards, DESE,
Canberra, March 2021.
[3]. Universities
Australia, 17,000
uni jobs lost to COVID-19, media release, 3 February 2021.
[4]. Details of the
changes are discussed in H Ferguson, Higher
Education Support Amendment (Job-ready Graduates and Supporting Regional and
Remote Students) Bill 2020, Bills digest, 12, 2020–21, Parliamentary
Library, Canberra, 2020.
[5]. Parliamentary
Library based on Australian Government, Budget strategy and outlook: budget paper no. 1: 2020–21; Australian Government, Final budget outcome, various years;
DESE, ‘Finance
publication’, DESE website, various years. Analysis is detailed in the body
of this paper. Figures taken from budget papers are exclusive of student loans
and certain research-related expenditure. It is not the intent of this paper to
analyse debates about university financial management. Some useful discussion
about possible factors shaping reliance on overseas student fee revenue is
provided in a series of blog posts by Andrew Norton. The final post in the
series, which refers back to the earlier analysis, is A Norton, ‘Why
did universities become reliant on international students? Part 5: The rise of
research rankings’, Andrew Norton, blog, 15 June 2020.
[6]. H Ferguson, ‘Higher
education research and teaching’, Budget review 2020–21, Research
paper, 2020–21, Parliamentary Library, Canberra, October 2020.
[7]. Unless
otherwise indicated, information and terminology in this paper is based on the Higher Education
Support Act 2003 (HESA),
incorporating amendments up to the Higher Education
Support Amendment (Job-Ready
Graduates and Supporting Regional and Remote Students) Act 2020 (JRG
Act). Legislative references for specific
funding programs are summarised in Appendix 3.
[8]. H Ferguson, University
research funding: a quick guide, Research paper series, 2020–21,
Parliamentary Library, Canberra, 8 January 2021.
[9]. HESA
funding is only available to higher education
providers, defined in section 16-1 as those providers
approved under Division 16. Division 16 includes those providers listed in HESA,
or those approved by the Minister under section 16-25. A list of
approved providers is available from DESE, ‘Providers
that offer Commonwealth assistance’, StudyAssist website, n.d.
[10]. HESA, section
16-27. TEQSA registers providers under the Tertiary Education
Quality and Standards Agency Act 2011 (TEQSA Act) according to
standards set out in the Higher Education
Standards Framework (Threshold Standards) 2015.
[11]. HESA,
subsection 90-1(c) and section 30-1. Further information about FEE-HELP is
provided later in this paper.
[12]. These categories
relate to funding only and can be found in sections 16-15, 16-20 and 16-22.
Different provider
categories are used by TEQSA as part of provider registration under the TEQSA
Act.
[13]. DESE, Portfolio
budget statements 2020–21 budget related paper No. 1.4 Education, Skills and
Employment Portfolio, DESE, created 6 October 2020, p .44; DESE, ‘Commonwealth
Grant Scheme (CGS)’, DESE website, last modified 25 February
2021.
[14]. DESE, ‘Commonwealth
supported places (CSPs)’, StudyAssist website, n.d.
[15]. DESE, 2019
Section 5 liability status categories; DESE, created 8 September
2020.
[16]. According to
DESE, 2019
Section 5 liability status categories, op. cit., in 2019, approximately
90 per cent of student contribution liable students (measured in equivalent
full-time student load, or EFTSL) deferred the cost of all or part of their
student contribution using HECS-HELP.
[17]. J Lomax-Smith, Higher
education base funding review: final report, Department of Education,
Employment and Workplace Relations (DEEWR), Canberra, 2011.
[18]. HESA,
subsection 33-10(1), section 93-10. As students often study across multiple
clusters over the course of a degree (for example, Bachelor of Economics
students studying economics subjects from cluster 1, and mathematics subjects
from cluster 2,), total costs per year of full-time study will often vary from
the amounts shown in Table 1. Grandfathered amounts are also currently in place
for continuing students who were enrolled prior to the commencement of the
current amounts under Job Ready Graduates Act from 1 January 2021. Where a
continuing student would be required to pay more under the provisions of the Job
Ready Graduates Act than they would have previously, the previous rate applies
under grandfathering provisions.
[19]. DESE, ‘Funding
clusters and indexed rates’, DESE website, last modified 27 November 2020; HESA,
Part 5-6.
[20]. Deloitte Touche
Tohmatsu, Transparency
in higher education expenditure, report prepared for the Department of
Education, Deloitte Access Economics, Canberra, November 2019. The basis for
current contribution amounts is discussed in H Ferguson, Higher
Education Support Amendment (Job-ready Graduates and Supporting Regional and
Remote Students) Bill 2020, Bills digest, 12, 2020–21,
Parliamentary Library, Canberra, 2020.
[21]. Ferguson, Higher
Education Support Amendment (Job-ready Graduates and Supporting Regional and
Remote Students) Bill 2020, op. cit.
[22]. HESA,
sections 30-1 and 30-20.
[23]. HESA,
subparagraph 30-1(1)(a) and section 30-25.
[24]. HESA,
section 33-5.
[25]. HESA,
section 30-27.
[26]. Ibid.
[27]. HESA,
section 33-1; Commonwealth
Grant Scheme Guidelines 2020, Chapters 4 and 7.
[28]. Other Grants
Guidelines (Education) 2012, Chapter 7, Part 6.
[29]. Ibid.
[30]. DESE, ‘Job-ready Graduates - frequently
asked questions’, DESE website, last modified 18 March 2021.
[31]. Ibid.
[32]. DESE, Technical
note for Job-ready Graduates Package, DESE, Canberra, 24 June 2020, p.
4.
[33]. Ibid., pp.
14–18.
[34]. DESE, ‘Performance-based
funding for the Commonwealth Grant Scheme’, DESE website, last modified 16
November 2020.
[35]. Ibid.
[36]. HESA,
sections 36-5 and 36-10.
[37]. HESA,
section 36-30.
[38]. HESA,
sections 36-10 and 36-15.
[39]. DESE, 2019
Section 5 liability status categories, op. cit., Table 5.5.
[40]. HESA,
subsection 36-10(2).
[41]. The Higher Education
Provider Guidelines 2012 (Chapter 6) require, subject to some exceptions,
that fees charged to overseas students must be sufficient to recover the full
cost of providing the course to the student, and that the fee cannot be less
than the relevant domestic student fee, unless the course is fully offshore or
permission for the lower fee is granted by the responsible department.
[42]. DESE, ‘Research
training program’, DESE website, last modified 14 December 2020; Commonwealth
Scholarships Guidelines (Research) 2017, Chapter 1, especially paragraph 1.6.30.
[43]. Commonwealth
Scholarships Guidelines (Research) 2017, Chapter 1, especially paragraph 1.6.5.
[44]. DESE, ‘Higher Education
Loan Program (HELP)’, DESE website, last modified 1 March 2021.
[45]. HESA,
section 128-20.
[46]. DESE, ‘Combined
HELP loan limit’, StudyAssist website, n.d.
[47]. HESA, Division
140.
[48]. H Ferguson and
G O’Brien, ‘Will
Higher Education Loan Program (HELP) debt be reduced because CPI has fallen?’,
FlagPost, Parliamentary Library blog, 31 July 2020.
[49]. HESA,
section 154-1.
[50]. Australian
Taxation Office (ATO), ‘Study
and training loan repayment thresholds and rates’, ATO website, last
modified 30 June 2020.
[51]. DESE, 2019
Section 5 liability status categories, op. cit., Table 5.8.
[52]. H Ferguson, ‘Updated
Higher Education Loan Program (HELP) debt statistics—2019–20’, FlagPost,
Parliamentary Library, 30 October 2020.
[53]. DESE, 2019
Section 5 liability status categories, op. cit., Table 5.8.
[54]. DESE, ‘HECS-HELP’,
StudyAssist website, n.d.
[55]. DESE, 2019
Section 5 liability status categories, op. cit., Table 5.7.
[56]. DESE, ‘FEE-HELP’,
StudyAssist website, n.d.
[57]. Ibid.
[58]. Ibid.
[59]. DESE, 2019
Section 5 liability status categories, op. cit., Table 5.7.
[60]. DESE, ‘SA-HELP’,
StudyAssist website. n.d.
[61]. DESE, 2019
Section 5 liability status categories, op. cit., Table 5.7.
[62]. DESE, ‘OS-HELP
and overseas study’, StudyAssist website, n.d.
[63]. Ibid.
[64]. Ibid.
[65]. DESE, 2019
Section 5 liability status categories, op. cit., Table 5.7.
[66]. HESA,
Part 2-2A.
[67]. HESA,
section 38-10.
[68]. Indigenous Student
Assistance Grants Guidelines 2017, Part 3.
[69]. Higher Education
Support (Maximum Payments for Indigenous Student Assistance Grants)
Determination 2016, section 5.
[70]. Indigenous Student
Assistance Grants Guidelines 2017, Schedule 1.
[71]. Ibid.
[72]. HESA,
Part 2-3.
[73]. HESA,
subsection 4-10(1).
[74]. DESE, ‘Job-ready
graduates discussion paper’, DESE, last modified 20 August 2020.
[75]. DESE, ‘More
opportunities for regional Australia’, DESE website, last modified 4
December 2020.
[76]. Other Grants
Guidelines (Education) Amendment (No. 3) 2020, Part 3.
[77]. Ibid., section 1.42.
[78]. DESE, Job-ready
graduates discussion paper, op. cit.
[79]. DESE, ‘National Priorities and Industry
Linkage Fund (NPILF)’, DESE website, last modified 16 March 2021.
[80]. Other Grants
Guidelines (Education) Amendment (No. 3) 2020, section 8.15.
[81]. Ibid, section
8.20.1. These figures have been rounded.
[82]. DESE, ‘Regional University
Centres’, DESE website, last modified 24 November 2020.
[83]. Ibid.
[84]. Other
Grants Guidelines (Education) 2012, section 7C.10.
[85]. DESE, ‘Higher
Education Disability Support Program’, DESE website, last modified 26
November 2020; Other
Grants Guidelines (Education) 2012, Part 4.
[86]. Other
Grants Guidelines (Education) 2012, section 1.95.1.
[87]. Ibid., section 1.90.10.
[88]. Ferguson, ‘Higher
education research and teaching’, op. cit.
For copyright reasons some linked items are only available to members of Parliament.
© Commonwealth of Australia
Creative Commons
With the exception of the Commonwealth Coat of Arms, and to the extent that copyright subsists in a third party, this publication, its logo and front page design are licensed under a Creative Commons Attribution-NonCommercial-NoDerivs 3.0 Australia licence.
In essence, you are free to copy and communicate this work in its current form for all non-commercial purposes, as long as you attribute the work to the author and abide by the other licence terms. The work cannot be adapted or modified in any way. Content from this publication should be attributed in the following way: Author(s), Title of publication, Series Name and No, Publisher, Date.
To the extent that copyright subsists in third party quotes it remains with the original owner and permission may be required to reuse the material.
Inquiries regarding the licence and any use of the publication are welcome to webmanager@aph.gov.au.
This work has been prepared to support the work of the Australian Parliament using information available at the time of production. The views expressed do not reflect an official position of the Parliamentary Library, nor do they constitute professional legal opinion.
Any concerns or complaints should be directed to the Parliamentary Librarian. Parliamentary Library staff are available to discuss the contents of publications with Senators and Members and their staff. To access this service, clients may contact the author or the Library‘s Central Entry Point for referral.