2.24: Australian Universities Accord – One Year Follow Up with Andrew Norton

Hi everyone. I’m Alex Usher and this is The World of Higher Education Podcast

When we started this podcast about thirteen months ago, our very first episode was about Australia and what was known as the “Universities Accord”. The Accord wasn’t actually a deal as the name implies: it was essentially a kind of expert-led panel designed to consult widely and deliver a blueprint for Australian higher education for the next quarter-century. It was meant to cover everything: access and attainment, institutional funding, student assistance, scientific research, industrial relations, system governance and more – a list so broad in fact that many people predicted that the final report might be very thin as well as very wide.

Our guest on that first episode was Andrew Norton, Professor in the Practice of Higher Education Policy at Australian National University. Andrew has been at the forefront of higher education policy debates in Australia for over two decades, and is the author of several editions of “Mapping Australian Higher Education” which is by far the best single-volume guide to understanding that country’s tertiary system. There is literally no one who could have given us a better overview of the politics and policy at play in the Accord.

That was last February. The Report was submitted to government in December, and released to the public about four weeks ago. And the report came in more or less as predicted: a mile wide, an inch deep. Lots of recommendations but nothing particularly innovative in global terms except possibly with respect to redistributing income across universities. Certainly, it’s a report that forsees a much bigger role for some kind of central co-ordinating body – appointed by government albeit theoretically arms-length from it.
And so we thought it was time to bring back our guide to all things Australian. What exactly does the final report recommend? How workable are recommendations? How much of it will the government actually choose to implement? Andrew’s back to give us his expert take on all of this. So without further ado, let’s hear what he has to say.

Alex Usher (AU): Andrew, let's start with the process of this report. It was written by a committee. How was the committee named? How did it conduct its business? How did those two things affect the way the report was written?

Andrew Norton (AN): This is really a Labor election promise. They took power in 2022 in Australia. The term “accord,” I'm not quite sure what that means because I don't think agreement is really a big part of what's coming down the track. It was a six-person ministerial appointed committee with some ex-officio public servants headed by Mary O'Kane, who's a former vice chancellor. It basically operated in quite a consultative way, in the sense that there were multiple rounds of submissions on different stages of the report, lots of meetings with relevant stakeholders, but ultimately you can't make a decision based on simply consultations. There has to be a world view in this report, which I think was often dictated by the terms of reference. So, things like targets for participation, attainment that was required by the terms of reference and the terms of reference were extremely broad. Covering almost everything you can think of in the university space. One of my concerns all along has been that the sheer number of issues that the committee had to look at meant that none of them really going to be treated in great depth, and I think that's in fact what we've seen with the final report.

AU: Let's start with that target or targets that they chose, which was to state that by 2050, Australia should have an 80 percent post-secondary attainment rate and a 55 percent university attainment rate. What do you make of those targets? Do they make sense? What are the pros and cons of adopting targets? What are the pros and cons of these specific targets?

AN: The 55 percent higher education target came from a bit of work that they commissioned from an economics consulting firm which claimed that sort of based on various assumptions about the future labor market, that's essentially what you would need in terms of attainment to meet the needs of the Australian workforce. But they've got all sorts of assumptions in there like how much of this is going to be by migration. Australia is a high migration country. And because there's a very strong skills bias in our migration system, some of that's going to come from migrants. If you read the report carefully, it's not actually saying we need 55% workers to have a degree, it's recognizing that many people have degrees and don't use them or are working in jobs that don't normally require a degree. I think the difficultly with any of this is really that how can we say in 2024, what does Australia look like in 2050? I think that is simply not plausible. And so, this is so hypothetical that it wouldn't make sense to seriously plan around that. Where maybe it acts as a shorter-term discipline on government, if you have said “to stay on track to that then we need a certain percentage of people enrolled in university by year X,” are you funding those places? So, in some ways, I think, as an internal self-discipline device, it might work for governments, but I just think intellectually, you can't say what the future needs will be. My view is people should make up their own minds about what they want to do with their lives. It's not simply a service to employers. From that point of view, I've always favoured more evolutionary systems that can adapt as needs change, but don't have artificial projections about the future.

AU: One thing I quite liked about it because I don't see it that often in public policy documents is that with the accord having chosen a fairly ambitious target right away they said, “look, this isn't going to happen unless we have big changes in the participation rate of underserved groups.” In particular, the one that I wanted to focus on was rural students. Australia, like Canada has an issue in terms of how do you provide education in sparsely populated areas, right? We both have big countries and with concentrated populations, how do you work in the rest of these areas? One thing they were talking about was an expansion of regional study hubs and the other was a national regional university, which sounds wildly impractical to me. What were these two suggestions and are they likely to work?

AN: The Regional Study Hubs idea is already in operation. This kind of emerged out of just local regional communities realizing that often there's people doing online study, for example, didn't have a quiet place to study, or the internet connection was terrible. So basically what these do is provide a place where people can go with high speed internet, a place to sit and work, help with kind of generic kinds of research or essay writing skills, but nothing that's actually discipline or course specific. They have been quite popular. I don't think there's a lot of longitudinal research that shows that makes a massive difference to completion or participation, but I think it's an obvious thing to do for people who, for various practical reasons, will not be able to physically move close to a university,

AU: How many of them are there? Does it matter which distance institution I'm enrolled in, or they'll help me no matter where I'm studying?

AN: Any institution. Originally there were some tighter relationships, but as this has evolved, it's for any institution. So, it's quite flexible.

AU: Would there be dozens of these? Hundreds?

AN: There are dozens now. The government has already said they want to put them into outer metropolitan areas as well, which like Australia has sprawling cities. So, you might be still in Melbourne where I live, but still be two hours from a university.

AU: What about this national regional university idea?

AN: That's the hardest one to understand. At the moment, we've got quite a large number of small regional universities. There are issues with them being subscale but whether this national regional university is the solution, I'm really not sure. This was an undeveloped idea in the interim report that they put out last July, and it's still very undeveloped here. Personally, my view is that there would be very difficult politics involved in this because a lot of regional communities are extremely attached to their local university which sometimes has the name of their region in it. So, would they really want to be submerged into some national bureaucratic agency? They would see this as probably control moving to Canberra rather than having local control.

AU: Let's switch over to funding here. Let's talk first about student contributions. The report suggested ditching the Job Ready Graduates program. If I recall correctly, there's a pretty heavy steer on that in the terms of reference. The Job Ready Graduates program I think started in 2020 or 2021, but it was the introduction of a new set of field of study prices meant to encourage studies in STEM and discourage them in the humanities. I'm not clear what it is that the accord wants to replace them with. The phrase is that prices should be related to lifetime income. I guess the idea is…you had that between 1996 and 2020, didn't you, with law and medicine?

AN: We did, yes.

AU: How different is this from the system that job ready graduates replaced?

AN: It will be very different for some individuals, particularly those doing humanities where they jumped from the lowest student contribution level in 2020 to the highest student contribution level in 2021. They will leave university with 50,000+ Australian dollars in student debt, which in my view, many of them will struggle to repay. Meanwhile, some other courses got very cheap prices. The big difficulty here is that nursing and teaching are put at a very special discount price. So, to change the system in a way that had no net cost to the government would inevitably mean large increases for nursing and teaching students, which I think is not viable. So, I've been saying, in some ways, the former government booby trapped their package because as soon as you touch that nursing and teaching after saying we need more of these people, the politics are going to blow up on the government. So that's difficult. But, I'm actually a fan of not necessarily the precise idea of lifetime earnings, but I think we should relate student contributions to likely repayment times. So basically, to have repayment times that are similar across degrees to the best we can. That means that degrees like arts, which have relatively low earnings, should be in a low band so that they can, sensibly be expected to repay in a reasonable amount of time.

AU: Let's leave tuition fees aside. Let's think about core government funding here. I'm not sure I saw much in here that was very strong on governments spending a lot more money on core teaching facilities. There are some big ideas about research funding, which I'll come to in a second. There's stuff about new funds for capital expenditures, which if I understand correctly involves taxing rich universities to pay for infrastructure at poor ones. But what about teaching? If you're going to double enrollments by 2050, which I think is what the report suggests is necessary to hit those targets we were talking about earlier, how's that going to be paid for?

AN: That's the number one question. They actually do have some reconceptualization of the teaching funding system. Historically in Australia, we've largely based it on the discipline of the subject that it's being taught, with assumptions about sort of the level of capital equipment and student:staff ratios required meaning that the rates per student can differ between disciplines. But it's been all about how do you actually inherently teach this discipline? Whereas they want to move to something that includes that, but also has some component of student characteristics in it with the idea that inevitably the participation rates and goals require bringing in students who are less academically prepared than our students now. There's an inherent problem of this with mass higher education. We've had this for decades anyway, but basically trying to steer resources to the universities that in fact have the heaviest teaching burden because they've got the most demanding students or the students who need the most assistance. So, I think that is not crazy, but how would it work? How do you measure needs? There's a long way to go on this.

AU: Andrew, let's turn to research for a second. Here, the Accord report suggests a lot more funding primarily by a two pass. The 1st is to increase funding of what we in Canada call the indirect costs of research. You call it funding the full cost of research. The second seems to be by creating some kind of big national challenges fund, which is recommend similarly by a big research review panel about a year ago. This part felt pro-forma to me, right? It's a call for new money, but not really a lot of a call for new ideas in the system. Is that fair? What's your take on the research section of this report?

AN: Here this kind of, there's two issues. There's the sort of the full marginal costs of the project, which aren't fully funded under most of Australia's competitive grant schemes. Then there are the broader indirect costs of university infrastructure, et cetera, that all projects will draw on to some extent. So, they want to fill in with both. One of the problems in Australia is that over time, funding has gone up for research, but it's steered towards the competitive project grants. So essentially, the universities that are successful in getting competitive project grant funding, then have this problem of how are we going to pay for it? And you could argue that some of Australia's relentless pursuit of international students has been the answer to that question. And so, what the Accord report suggests is moving back to a more balanced government funded system, at least for the core public research. These ideas are not new, reports have suggested this many times in the past. I think a previous government even tried to move a bit towards that direction. But, the next budget crisis, it all got stopped. There's nothing changed in the fundamentals that would really, I think, lead to an altering of this. Again, we've got this report with dozens of recommendations for more spending, no sense of priorities, or how it's going to be paid for, except for one idea around taxing the universities themselves. This is one of the reasons why you have to ask, where can this possibly lead?

AU: One area where I thought the report seemed to be breaking some new ground, at least in Australian terms, was in the area of system governance. This looked new to me. I think there have been intermediary bodies in Australia, but it's been about 40 years. What they recommended was a tertiary education commission. The remit was to include, and this is big, policy development for higher education research, future planning, making mission-based compacts, pricing, funding allocation, accountability, data collection and transparency, quality, and performance. What's left for the ministry to do if a tertiary commission does all this? Is this a recommendation the government is likely to take very seriously when in effect it eviscerates the ministry and take so many powers out of government and puts it into an independent body?

AN: I would doubt it, but it would always work within a funding envelope that the government determined. So, the previous commissions did do that. I think it does change the sort of the dynamics of it, especially did some historical research on the era in the late 1950s, when the first of this sort of equivalent commissions was established. They produced very detailed reports on the state of the system, which this commission would also have to do. What the future needs are likely to be, looking at demographics, school leavers, labor market, et cetera, et cetera. I think what that did was set the benchmark of what we need to have based on this detailed research and the government could reject that, but change the dynamics compared to the current system where the government just does everything internally, there's no analysis saying actually “do a huge birth core coming?” and all these other needs on the horizon and what do we do about it? My view was that this was introduced in the late 1950s by a conservative government that apart from the Prime Minister himself, wasn't very keen on this. But, after he retired, because this commission was putting out these high-quality reports, public funding for higher education nearly doubled in real terms in the six years between when he retired when his party lost office. And so maybe this did change the dynamics in a way that meant there would have been more funding than there would have been otherwise even if it wasn't as much as the commission itself recommended.

AU: This document seems to me fairly statist. The fascinating sentence in the executive summary says “Institutions need to innovate and evolve and type diversity size to meet the changing needs of our students and economy. Achieving this greater level of institutional innovation diversity would require long term planning, system wide collaboration and proactive intervention by governments to reduce barriers to evolution and change and to unlock the innovation potential within the sector.” I read that and I thought “why doesn't government just get out of the way?” It implies substantially less autonomy for institutions is my view. I know you've written that labor's vibes towards the sector are good, but the substance might actually be worse than it was under the liberals. Is that still your view after reading this document?

AN: This is not official labour party policy yet, I'd stress that. But I actually think there's a lot of common ground at the moment between the major political parties, that's got a lot trust that universities do the right things without heavy pressure from the government. Maybe particularly in the labor side, a great level of confidence that a technocratic system can outperform the kind of more decentralized system that we've had to date. Now, I just think there are so many bold assumptions about how competent this commission will be, about its capacity to make meaningful projections, whether it will in fact be ahead of the game. So, my view is that they'll lock in multiyear agreement which are then quite hard to change. Whereas under the current system, if circumstances change, universities can adapt, at least in small ways, immediately. We're losing all that kind of decentralized knowledge that can inform decisions and replacing it with a centralized body that can only work with the key metrics it has. In Australia in particular, we've had enormous problems with national student enrollment system. So often, my view is unless that can be fixed, this simply isn't feasible. At the moment, we're working on two-year-old data about enrollments. You cannot run a system that way, but you can run a university where you've got your own data. Sure, you don't know what's going on nationally, but at least you know what's going on at your own institution and you can make sensible decisions.

AU: I'm going to make my usual comment, lucky you to be two years behind. In Canada, we're rarely less than three.

AN: But similar problems. Technocratic processes are intensely data demanding because you've got to know what you're doing. So, if the IT systems are not up to it, it's a disaster and if the IT systems collapse. It's what I call a single point of failure. The whole system will fall over.

AU: We're discovering that while trying to implement the new international student visa system on the fly in the middle of the height of the application season. So, we see it exactly. Now, you just mentioned this is, this is just a report to government, right? We don't know what the government is going to choose to act on. What are you hearing about this right now? What's your guess about how much of the package the government will accept? And are we likely to know that when the budget is handed down in May, or might we have to wait even longer?

AN: So the minister has always said, before the report came out, that this would be a staged process, that it wouldn't be possible to do it all at once. But given Australia is in probably internationally a reasonable fiscal position, but still a tight one by Australian historical standards, I think it's going to be really hard for him to get a significant additional money through the government. As an example, like last year in response to the interim accord report, they made funding for Indigenous bachelor’s degree students completely demand driven. So, no funding caps on how many students that universities could take. That was only going to cost about 30 million Australian dollars. And even that was offset in the budget. It's basically taking money from other higher education programs. So, if you can't get 30 million for a very disadvantaged group, how is he going to get billions of dollars for this kind of system level change? So, what I think we'll see in the sort of a shorter term is mainly things that won't cost the government very much money and probably at least setting up the infrastructure of this commission to be one of them. Probably only cost a few million dollars, but if you're going to have a planned system, you need to get the planners working pretty early to make it work. I think there are a couple of local political issues around the student loan scheme where they will need to act more quickly than the multiyear time horizons we're looking at for the commission and other things.

AU: Let me ask you to put yourself in the year 2050 and Australian academia is looking back at the last 25 years and wondering how it got to where it currently is. How relevant do you think this document will seem then? What's the impact of this document over the next 25 years? Is it really setting policy for that long? Or not?

AN: I suspect probably not, but it depends on whether this commission really gets going in a quality way or not. I don't think we'll see the required funding, but we may see a shift to a more regulated system. It will end up with maybe different versions of the problems we have. So, there will be pressure as there was in the 1980s to get rid of these commissions With this though, the government does have control over the purse strings, but actually isn't that involved in the sort of the day-to-day decision making about things like how many students.

AU: If you imagine the whole thing gets implemented or a substantial chunk of it gets implemented, is it enough to move the needle? Will Australia and higher education really be different in 25 years?

AN: I think it would be just because the scale difference. For example, Australia has not had any new public universities this century, whereas the second half of last century, they had new ones every decade. They're talking about going back to new universities, bringing in more publicly funded non-research teaching institutions. So, the institutional fabric could change quite significantly if that goes ahead. And of course, We'll have even more than in the recent past students whose academic preparedness is low, and that does require serious rethink of pedagogy and other things that will be required to actually not only get them to enroll in the first place but to complete their courses.

AU: Andrew, thank you so much for joining us and take care.

AN: Thanks Alex.

AU: And it just remains for me to thank our excellent producers, Tiffany MacLennan and Sam Pufek and you, the listener, for tuning in. If you have any comments or suggestions for future podcasts, please get in touch with us at podcast at higher ed strategy dot com. Join us next week when our guest will be Mykola Trofymenko, the rector of Mariupol State University in Ukraine. He’ll be joining us to talk about the university’s near-death experience two years ago, its rebirth in Kyiv and its future as the country’s “Invincible University”. Bye for now.