Speech to the Universities Australia 2018 Higher Education Conference

Simon Birmingham:     Well, thank you very much, Professor Margaret Gardner, for that welcome. To you, to all of the leaders at Universities Australia, global leaders of academia and universities, distinguished guests, ladies and gentleman, and a particular callout, if I may, to the chief executive of Universities Australia, Belinda Robinson. Belinda, we trust and assume this will be your last Universities Australia conference as CEO, and with your intended resignation announced last year and departure to do other things, and thank you, Belinda, for the way in which you have constructively engaged in the policy debate on a range of levels over so many years, ably representing Australia’s universities.

 

Congratulations [indistinct]. I would like to acknowledge the Ngunnawal and Ngambri peoples – the traditional custodians of the Canberra area – their elders, and all of Australia’s Indigenous people who, as Australia’s Education Minister, I acknowledge we continue to learn much more about Indigenous knowledge, Indigenous culture, to learn from Indigenous knowledge and culture, and to build upon such knowledge and culture as a nation together.

 

First and foremost, I figured today, ladies and gentlemen, we might as well deal with the elephant in the room. It would be nice if money was limitless, but it is a sad fact of life that it is not. It’s another sad fact that, ten years after the global financial crisis, Australia’s Federal Budget remains in deficit – this year, projected to be a deficit of some $23 billion. Too many in the university sector seem to have underestimated the resolve of the Government to live within our means, to live within our budget. That was a mistake. Transparently, the decisions taken in the Mid-Year Economic and Fiscal Outlook late last year were not our preferred options. However, the Government has a budget to live within. As a portfolio minister, I and my department have a budget to live within and, consequentially, the entities within my portfolio have a budget that they need to live within, too.

 

Ever since the Gillard Government Budget of 2013, savings and efficiencies have been budgeted for and proposed to the Commonwealth Grants Scheme. Proposals for savings are not new and have come from both sides of politics. I think and hope that all would agree that I have been consistent – consistent since my appointment as minister, before and during the last election, and indeed since – about this reality. While funding has continued to grow, and grow quite strongly over the five years since that 2013 final Labor Budget, and indeed in that period of time, consultations, discussion papers and reviews have been near endless, the scale of the proposed savings has frequently and consistently diminished. Indeed, over the last year alone, the Turnbull Government has written off around $1.3 billion in proposed higher education savings.

 

But ultimately, the annual budget variations and delays in the higher education budget could go on no longer, the Senate uncertainty associated with the higher education budget could go on no longer, and hence the MYEFO decisions were made. However, just because we apply the budget, does not mean, and does not change, the reality that we genuinely value, respect, and admire our Australian universities. The Turnbull Government knows that you are drivers of economic growth, that you advance knowledge and social mobility, that you stand tall on the world stage, that you transform the lives of individuals, that you have much to be proud of – and we much to be thankful for.

 

Contrary to some reports, the sky isn’t falling and it isn’t about too. Let’s not forget that federal funding to universities stands at a record high at over $17 billion per annum. The overall university sector is in good shape, running an aggregate surplus of $1.6 billion in 2016. This is not a weakened and ailing sector on the brink of decline and fighting for its survival. While not every provider enjoys the same circumstances, as a sector you are strong, and deservedly so.

 

This was recognised in comments from Standard & Poor’s Global Ratings who, in noting the MYEFO decision, said: we think the funding freeze is unlikely to substantially affect the credit quality or the financial position of the nation’s top tier universities. Although the impact of the freeze and related savings measures will depend on how management responds, Australia’s top universities have several factors in their favour. Chief among them is they possess strong operating margins and large holdings of financial assets relative to their low and conservative debt levels. Individually, I am pleased universities have shown more confidence than some of their lobbyists. For example, USQ said they will continue to graduate resilient and industry-ready students; Flinders has increased its offers by hundreds of places; Deakin has said the funding freeze will not affect planned enrolments.

 

Let’s also put the CGS changes into a bit of perspective alongside other funding streams. As part of record higher education funding over the next four years, we will invest almost $12 billion on research from my portfolio alone, including almost $2.9 billion in 2017-18, which will continue to climb to $3.1 billion. We have retained the Higher Education Participation and Partnerships Program, and this more than half a billion dollar program over the next four years provides a means of support, particularly to encourage equity in participation. The Government continues to support regional loadings and is improving access to higher education through the establishment of up to eight regional study hubs – hubs which will support students in regional areas to locally study courses delivered by distance from an Australian university. We are currently consulting the final guidelines of this program and expect to call for applications next week.

 

We’re improving support for students through the new Rural and Regional Enterprise Scholarships. Students studying science, technology, engineering, and mathematics courses in 2018, including in agriculture and health, are already benefiting from the first round of these scholarships, with a second round opening later this year. And the Government’s recent decision to reduce the time required for regional and remote students to be considered independent of students support payments, such as Youth Allowance, will enable them to commence their university studies sooner. It’s a change that will benefit around 3700 regional students across Australia.

 

We’ll continue to provide funding via the Higher Education Loan Program to assist all eligible students to pay their student contributions according to university enrolment decisions, in addition to the maximum CGS payment. This ensures no student need pay course fees upfront, and they will continue to pay no real interest. But we do need to address the fact that around $55 billion of student loans, funded by taxpayers, remains outstanding and that, on current settings, around a quarter of those loans will never be repaid, unless this time we do something about it. That’s why we’ve introduced a new loans bill into Parliament and have been consulting with our political colleagues, across the rainbow political spectrum that is the Australian Senate, on the revised payment threshold and lifetime loans cap. While I take nothing and no one for granted, I trust that we can, with the change we have to make to these repayment thresholds and settings, achieve long-term security for our world-leading loans program, and therefore cement in place a guarantee for Australian students to access higher education with no upfront fees.

 

As well as the budget pressures that we face, and notwithstanding the overall excellence across our universities, we also need to be open and honest about continuing to work on quality issues, such as attrition rates, completion rates, and concerns from employers about the workforce preparation graduates. In 2015, the attrition rate reached almost 15 per cent, compared to the lowest point achieved in 2009 of around 12 per cent. Similarly, completion rates have declined, and recent research from my department shows that the full-time employment rate among recently-completed graduates has fallen from around 85 per cent in 2008, to about 72 per cent in 2017.

 

By seeking to link a degree of funding growth to performance outcomes from 2020, we want to incentivise universities to provide an even better student experience, and introduce new incentives to focus on student performance, retention, and employment outcomes. Now, I know, across the university sector, many are eager to know more about performance measures. And as we have said repeatedly since announcing a desire to develop a formal performance measure in last year’s Budget, the sector will be intimately involved in developing workable measures that have the confidence of the sector. That’s why we’ve timed it now to a start date in 2020, providing ample time for your input, engagement, and thoughts. This is your opportunity to build a framework that focuses on student outcomes and also raises and cements public confidence in the system.

 

Another area where improvements can be made to ensure our higher education students are receiving the best quality education is the interaction of professional accreditation arrangements with course requirements. Just last week, Professionals Australia held a National Professional Accreditation Best Practice Summit, which was a great opportunity for participants to discuss the relationship between our higher education system, professional associations, industries and employers, and students. This was an important and impressive initiative that demonstrates the commitment of the professional and university sectors to a collegiate approach regarding identification and adoption of good practice in professional accreditation.

 

As I said in my message to the Professional Accreditation Conference, the stamp of approval that external accreditation provides and the processes behind it helps to ensure that students choose the right course, and that graduates of accredited courses emerge from their studies with the up-to-date knowledge and skills that reflect the very best work practices in a range of professions. But I acknowledge that accreditation can place a regulatory and financial burden on higher education providers, and on those in the professions who are called upon to manage accreditation assessments. That’s why in early 2016 we asked the Higher Education Standards Panel to advise on how we might be able to alleviate some of these burdens. Students and parents have written to me, and my parliamentary colleagues have raised with me, concerns from students about finding work placements that are part of course and accreditation requirements, and therefore concerns from graduates who have found their qualification may at times not meet those accreditation requirements.

 

The Professional Accreditation: Mapping the Territory report, commissioned by the Higher Education Standards Panel in response to this request, acknowledges many positives in the accreditation process, but it also notes areas for improvement, including the cost of accreditation, some incoherent processes, and overlap with the regulatory work of TEQSA. Clearly, our professional accreditation system needs a tune up, and today I’m pleased to be able to share with you and release publicly the panel’s advice to me. The advice draws on the Mapping report, as well as consultation with key stakeholders, including Professionals Australia, Universities Australia, and the independent reviewer of accreditation in the health professions, Professor Mike Woods.

The panel acknowledges the good work that Professions Australia and Universities Australia have undertaken with their 2016 joint statement of principles on professional accreditation, and I understand that work is well-advanced on a similar statement being developed with the non-university sector, but it takes this further and recommends a sector-wide code of practice be developed.

 

The model the panel recommends is a legislated code that limits professional accreditation to matters that are profession-specific, rather than overlapping across issues already quality-assured by TEQSA. For example, some accrediting bodies currently seek to look at issues such as university governance, including academic governance, facilities management, student support, and assessment integrity. However, all of these issues are already considered by TEQSA in its decision to register and re-register a provider.

 

There needs to be greater clarity on the role of accrediting bodies in this assurance process. The panel also recommends that TEQSA work with accrediting bodies to build their capacity, to work more effectively and efficiently through activities, such as establishing guidance, participating in workshops, encouraging a focus on outcomes-based quality assurance and the promotion of best practice regulation. And it suggests holding a stakeholder forum to discuss the future of professional work and possible opportunities for streamlining accreditation.

 

The Government, in principle, accepts the panel’s recommendations, and we will consult closely with the sector over coming months on their implementation. I thank Professions Australia, their member industry organisations such as Engineers Australia and Universities Australia, for their willingness to take collective responsibility for addressing these issues as a matter of priority, in the interests of students, graduates, and universities.

 

We’re also pushing ahead with improvements to transparency in admissions data, also following on from recommendations of the Higher Education Standards Panel. Following the excellent work carried out by the Admission Transparency Implementation Working Group, chaired by Professor Kerri-Lee Krause, the first phase of improved admissions information has been published. According to the findings of a formative evaluation undertaken by TEQSA in late 2017, I’ve been informed that all universities and more than half of other higher education providers have endeavoured to publish new or improved admissions information. I want to thank all universities and higher education institutions for their commitment to implementing these important changes.

 

Later this year, phase two will see a new website launched, which will bring together in one place relevant admission information for available university undergraduate courses. This, finally, will enable prospective students to compare the admission requirements and processes for all Australian universities in one place. This is long overdue and will put students in the driver’s seat when it comes to making study choices. When fully operational, the website will include information such as course entry requirements, including minimum ATAR required; details of special consideration available, such as selection rank adjustment factors; any course prerequisites required; and details of how previous students gained entry into a particular course or university, including the spread of ATARs of students who were offered places. Then, by 2019, all universities and other higher education institutions in Australia will be expected to be consistent in the way they describe their admission information, by using the same terminology and language for their entrance requirements.

 

And just as the Government seeks an enhanced student experience for domestic students, we need to think about the experience we offer international students in new ways, too. I would like to acknowledge the great work done by universities and education providers to attract, retain, and support record numbers of international students to study in Australia. You all know how important international education and international partnerships are. The work you’re doing in this space makes a significant contribution economically, socially, and culturally. It’s why the Turnbull Government is championing programs like the New Colombo Plan, and developed the National Strategy for International Education. These initiatives are transformational, cultivating the next generation of leaders in Australia and in the region, with tens of thousands of participants in various programs to date.

 

The Foreign Policy White Paper released late last year also identifies the critical importance that international education has in relation to Australia’s future, and particularly the Government’s foreign policy strategy. To quote from the paper, it says: our commitment to education, training and research exchanges will remain central to Australia’s soft power. These exchanges build influence and strengthen people-to-people links and mutual understanding. Australia will continue to welcome hundreds of thousands of international students to our shores. The paper identifies the benefits that have already accrued and from which we need to build upon, stating and highlighting that more than 2.5 million international students have studied in Australia in the past 50 years. Many foreign government and business leaders, including heads of state, ministers and CEOs, have studied in Australia and understand our institutions, values, and perspective on the world. This is a significant asset to Australia.

 

Alongside the quality of our education institutions and the Australian lifestyle, international students come to study in Australia because of our safe campuses, communities, and our welcoming environment. It is, of course, critical – as has been noted in recent days – that we all continue to work together to ensure the safety of our campuses for domestic and international students alike. I’m pleased, though, that a 2016 survey of more than 65,000 international students studying here found that 93 per cent rated personal safety as a key reason for choosing Australia as a study destination. This endorsement is critical, and critical that we maintain that safe reputation that we rightly enjoy.

 

While we are a destination of choice and enjoying significant growth in the students choosing to study here, we cannot be complacent. International education is a highly competitive, globalised sector, which is expanding as income aspirations and participation in education in emerging economies continue to rise. The future of our position as a world leader in education depends on us continuing to deliver a high-quality education, a safe and welcoming environment, and in offering international students a strong foundation for their career aspirations.

 

There are obligations on all providers to meet the requirements of the quality standards for international education, the national code of practice for providers of education and training to overseas students, to ensure they have safe and secure learning environments and to equip students with the knowledge and skills needed for their future paths and careers. But I know that you all seek to go much further than those standards, and that you do. That’s why we need to continue to work together, and that we are committed to doing so, on a sustained focus on deepening the engagement of international students with domestic students, as well as with the broader community.

 

This is a strong message from the international students surveyed, that engagement is critical to our international students. That want, and should have, a positive cultural experience unlike any that they may have in their home country. It will be that experience that keeps them coming back. And, as with domestic students, we also need to keep our focus on equipping international students with the skills they’ll need to build a career and strengthen their employability through opportunities for work-integrated learning.

 

These objectives form a key focus of the national strategy and the Council for International Education’s agenda, which identified improving the student experience as a key priority. We remain committed to working with the council – which I am proud to chair, which brings together my ministerial colleagues – and working across the sector to ensure international education remains a strength of Australia’s education system.

 

In conclusion, my invitation to you today is this: let’s look forwards instead of backwards. Let’s, as this conference suggests in its title, be focussed on the fundamentals we need for the future. I think those of you who have worked with me and engaged with me know that I always remain open to new ideas, but the budget parameters, as I said at the outset, are the budget parameters and, like the rest of the community, we need to live within them. What we had a year ago though, and what we still have, is an opportunity to continue to work together in ongoing areas of policy improvements that strengthen our outstanding higher education and university sector; to keep making the gains, as we have done, in improvements in policies around admissions and accreditation, as I’ve spoken of today. All of that means continuing to come together and recognise the realities in which we all operate, but to do so to ensure the future fundamental settings are right.

 

For me, as indeed for everybody here, investment, action, and work in and on our university sector is critical to the future of our nation. We remain determined to work as cooperatively as we can to strengthen the quality of outcomes for students, the quality of outcomes for knowledge and research, the quality of outcomes for our future economic development that underpins the way of life and the social stability we have in Australia. I thank you and congratulate you on the continued work all of you do, on the discussions you’re having here as part of this conference about those future fundamentals, the transformation that is taking place across the world in areas of higher education and your work to be at the forefront of that, and look forward to continuing to work with you where we can in the development of all of those issues.

 

Thanks so very much for the chance to speak with you today.