Responding to The Australian Universities Accord challenge

The Higher Education Review being led by Professor Mary O’Kane, to propose a new Accord for higher education to Minister Jason Clare, is carrying the weight of heavy expectations.  O’Kane, who is experienced in the ways of academe, has thrown out a grand challenge to the sector.  

In her article on 6 January, 2023, she acknowledges the evidence of success and the significance and impact of higher education for the future of Australia.  

Her plea to the sector, repeated in the recent discussion paper, is as follows:  

“I recognise what is and what has happened, but please paint a picture of the desired future state of higher education in Australia – make your expectations more than a longing for a better time and place, but rather a coherent set of priorities for change.” 

This is my response to Professor O’Kane’s challenge. I write with all the benefits and detriments of someone who has spent their adult life in universities and, since the 1990s, engaged in the policy debates and decisions that shape Australian universities.

Towards a new tertiary education system

Australia should have a world class tertiary education system.  The tertiary education system should bring together vocational and higher education that educates at post Year 12 or equivalent level.   

This should be overseen by an independent agency that provides advice to government and the organisations it oversees, monitors the outcomes of the system for impact and advancement, oversees quality and supports dissemination of best practice.

To ensure a world class tertiary education system is not the work of one budget cycle or one government.  It requires a plan for its development with a 10-to-20-year horizon.

As the Accord discussion paper suggests in the breadth and diversity of its 49 questions, a big education system idea to support Australia’s future covers many areas.  In this paper I am canvassing only three elements of the change needed.

Two very important areas, research and access, equity and inclusion require separate discussion and analysis and I have not covered them here.

Three issues are discussed below:

• Future scale and scope of the tertiary education system

• Funding

• Institutional diversity

The 75% tertiary educated future

The nature of our society and economy will demand more, not less, tertiary education than we currently provide.  This demand will include 

• education to meet the complex knowledge and technical requirements of the organisations, industries and services that will comprise our economy

• retraining as occupational and professional requirements and industry and sector mix changes

• support for civic and cultural engagement of our longer-lived and increasingly diverse population, 

• capacity to generate new knowledge and discover more about our world, and

• translation of the research and findings generated for better practice, services and products and the enlightened development of our society and economy.

These different demands range from providing value to individuals, organisations and communities through specific knowledge and skills, including the adaptable and transferable skills and knowledge that support transition through changes in the economy, and beyond this to building the “capability of people to be and do what they have reason to value” (Moodie and Wheelahan 2018).

How does this translate into attainment targets for higher education?  

The 2021 Census tells us that some 81% of 20-34 year olds completed Year 12 and we know that the 2019-2023 National School Reform Agreement sets a target of 90% Year 12 or equivalent completion by 2020.  These data provide a foundation for framing the attainment levels needed from tertiary education for our future.  

According to the 2021 Census, some 1.8 million people in Australia were attending a tertiary institution, with around 66% in higher education.  In the Australian resident population (which includes people who have completed their qualifications outside Australia) in 2022, 45% of 25-39 year olds have a bachelor degree or above as their highest qualification.  Thirty-one percent of that same age group hold a vocational education qualification as their highest qualification, with over half of this group, 16.5%, with Certificate IV to Advanced Diploma qualifications.  The latter qualifications speak to post-Year 12 tertiary education attainment.

Educational attainment targets for a bachelor degree should not be the focus for our future to the exclusion of other tertiary qualifications.  Given the projections of demand for post-school or tertiary qualifications, and the high levels of completion of Year 12 or equivalent, we should frame attainment targets against tertiary education qualifications of post-Year 12 equivalent.  This means vocational qualifications Certificate Four and above, and higher education qualifications from Diploma and above, rather than in relation to the bachelor degree (as was the case with the Bradley Review).  This ensures focus on tertiary education that is more responsive to the education needed as the basis for our future economy and society.    

I suggest that Australia consider 75% as the attainment target of post-Year 12 or equivalent qualifications for the Australian resident population aged 25-39 years by 2040.

Not addressed in this discussion are attainment targets in tertiary education for underrepresented or disadvantaged groups and pathways in tertiary education between vocational and higher education.  They require separate consideration in relation to evidence of participation and success in tertiary education by different groups and the barriers to pathways in tertiary education.  

I suggest we not frame a separate attainment target for groups currently underrepresented in tertiary education (again moving away from the Bradley target) but recognise that our attainment target should apply to all in the relevant age group.  However, the path to successfully ensuring access and equity for all needs separate discussion and a series of changes to address successfully that aspiration. 

The reasons for framing a target for overall attainment are important.  Over the last decade, 2011 to 2022, attainment of bachelor degree and above increased by about 11%, yet attainment of post-Year 12 vocational qualifications increased only marginally by about 1.6%.  Migration has increased the proportion of the resident population aged 25 to 39 years with higher education qualifications, compared to the proportion held by Australian citizens of the same age group.  Conversely, a greater proportion of Australian citizens have vocational qualifications as their highest attainment, than the resident population.

The 75% tertiary education attainment target for the Australian population is necessary for the economy and society we desire.  It is within reach, but will require change to current higher education and vocational education 

Challenges for change

There are two major policy challenges to be addressed to achieve this aspiration for Australia.  They are 

1. the challenge of institutional funding that supports quality and equitable access for the Australian population across vocational and higher education, and

2. the challenge of diversifying institutional settings to enable effective tertiary education provision that addresses disparities in 

   1. geographical needs and locations,

   2. societal and community circumstances and obligations, that also simultaneously allows for

   3. the development of intensive concentrations of expertise that are vital for Australia to remain integral to international knowledge systems.

In other words, the argument for institutional diversity is not a simple one of having different ‘types’ of tertiary institutions.  It is a challenge that must meet different circumstances of individuals and communities, providing diversity of experience and opportunity, as well as, recognising that higher education is not only a creature of national demands and circumstances, but benefits from being part of global knowledge systems.  

There is also a third aspect of tertiary education that should be explicitly acknowledged when the policy challenges outlined above are considered.  This is the particular contribution that institutions should and must make to the outcomes sought.  

In recent times, policy changes have focused on the incentives and disincentives to particular behaviours of potential students or other organisations.  The outcomes of education or research are individualised or marketised in student completions or commercial returns.  This leads to designing policy as if increments of funding are all equal, while the shape and purpose of the institutions receiving that funding, and delivering ‘services’ such as education or research, are largely irrelevant.  Yet institutions create value and support activities that are more than the summation of the funding units they receive.  Attention must be paid to the fabric and strength of institutions of learning and research, in order to ensure the resilience of quality tertiary education and its connections to the communities it serves.  We should design funding that supports resilient tertiary education institutions as the foundation of a tertiary education system.

The challenge of institutional funding

Higher education dominates Australia’s tertiary education system.  Currently, some 1.6m students are enrolled annually, 73% domestic and 27% international students, and around 90% of those students are enrolled in the 43 registered universities (37 of which are public) of the total 195 higher education providers. 

Higher education dominates government funding for tertiary education – the median cost of education is higher, the majority of students is full-time (close to 70%), and in relation to universities there is a substantial and separate investment in research.  Universities are dominant in tertiary education in income earned from student fees, commercial transactions and philanthropic donations.  And the scale of Australian universities, in terms of their impact on professions, industries, knowledge generation and translation, is internationally competitive and significant.

There are more than 4,000 providers of vocational education and the majority are private companies or organisations.  There is a large number of students enrolled annually (about 602,000 in the 2021 census). More than half are enrolled in a small number of public institutions and a much higher proportion are part-time (65%) than those enrolled in higher education (32%).  

Despite the plethora of organisations involved in tertiary education in Australia, it is dominated by public institutions, universities and TAFEs, where the major accountabilities in terms of funding of universities is to the Commonwealth government and for the TAFEs to State governments (although around 40% of vocational funding is from the Commonwealth government).  

The basis on which public funding is distributed to higher and vocational education is different and, apart from some overlap in relation to income contingent loans, essentially similar levels of educational qualification, such as diplomas, are treated entirely differently for funding purposes.  Their relative autonomy in relation to the design and delivery of educational qualifications is also markedly different.  Both these factors constitute barriers to movement from a vocational qualification to a higher education qualification and therefore to the ‘pathways’ that are sought as a means of facilitating access across the tertiary education ‘system’.  Australia does not currently have a tertiary education system – it has sectors of tertiary education.

Vocational education provides across a wide range of educational fields and qualification levels, from very short training courses of a few days to the many years a student will spend to acquire a trade qualification.  Vocational education provides skills and knowledge to the equivalent of gaining a year 12 school outcome, as well as qualifications post-Year 12.  The heterogeneity of vocational education is a strength, as it provides for the many educational demands our society develops.  It is also a disadvantage, since the Australian funding tends to be based on short cycle, low complexity training and understates the funding and institutional support necessary for post-Year 12 qualifications such as Diplomas and Advanced Diplomas (Moodie and Wheelahan 2018).

This suggests one major area to be tackled is ‘harmonisation of funding systems of vocational and higher education for education for post-Year 12 qualifications to help address the disincentives for movement between vocational and higher education.  ‘Harmonisation’ does not mean funding all education the same irrespective of level or complexity, but rather recognising longer cycle vocational qualifications need to be anchored in the more stable institutional funding regimes that characterise higher education.  

The introduction of the HELP system to some higher-level vocational qualifications was a step in this direction but needs recalibration – as it does in higher education - to rebalance government and individual student contributions and to reduce complexity.

The first step is to reconsider the current funding regimes at work in vocational education and the role of State and Commonwealth in them.  There is a need to frame the federal-State compact that would address funding of post Year 12 tertiary education – and the framing of this compact needs to begin with the public institutions that currently educate the majority of the tertiary student population.

The challenge of diversity

In higher education there is a limited set of four institutional types recognised by Australian legislation: Institute of Higher Education, University College, Australian University and Overseas University. According to the National Register of Higher Education Providers, there are 147 active Institutes of Higher Education, 42 Australian Universities, five University Colleges (following a recent redesign of the category) and one Overseas University (no longer admitting students).  

Among the universities there are six dual-sector universities that incorporate substantial vocational education and higher education in the one institution and governing legislation, four in Victoria.  There are a number of universities that are predominantly serving rural and regional populations, around fourteen.  University of Tasmania is the only university operating in that State under its legislation and Charles Darwin University might be argued to have similar status in the Northern Territory.  The ACT has within its boundaries two universities, ANU and University of Canberra, but only one within its jurisdiction.

If universities are measured by research intensity then there are only seven universities whose research income amounted to 20% or more of total operating revenue and nine whose share of postgraduate research students amounted to more than five per cent of total enrolments. Yet all Australian universities, so designated, have to maintain the level of research required by the Higher Education Threshold Standards and are able to offer doctoral level education.

The challenge is to examine the incentives to try new types of institution and the barriers to doing so.  Why have there been no new dual sector universities in recent decades?  What is the role of National Institutes of Higher Education?  Why are there no State universities of the type that are spread across the USA which have campuses that are research intensive, as well as campuses that are educationally focused?  When we are trying to ensure access for our population, dispersed benefits to community, and concentrated expertise to drive enhanced knowledge, innovation and practice, what is the tapestry of institutional types that can make sure we respond to all these needs?

A tertiary education system

We should tackle the challenges of institutional funding and diversity to create the tertiary education system we do not yet have in Australia.  We should do so to improve the chances of reaching the educational attainment levels necessary for Australia’s future.  We should do so to create the circumstances to provide the equity and access necessary for that attainment and overall well being of our society.  

We need to move away from the current division of vocational and higher education, founded in 19th century experience, and the current set of university institutional types, built on 20th century aspirations.  

The first step in this direction would be to provide a safe space and some incentives for new institutional combinations to be created or to reconfigure some that already exist.  We don’t need to change all the rules for all at the same time if we are prepared to consider some government sanctioned ‘experiments’ to test the appetite for a more diverse tertiary education system.

We currently see developments at State level that are contemplating mergers between universities.  These are complex but still stay within the current institutional funding and provider category constraints. 

While many large TAFEs are also registered as National Institutes for Higher Education, what benefits do they get from this designation? How might a University combine with some campuses of vocational education, without the detriment of then providing research funding and opportunities and doctoral training across all parts of its domain?

If our future is a world class tertiary education system, then our first step is to begin imagining what such a system might be, create some space for better harmonised funding and experiment with more diverse educational institution types.

And if we are going to support the creation of a tertiary education system and be able to support experimentation and evaluate its outcomes, we need a tertiary education commission – an independent agency to allow for the policy debate and institutional support for a major system change over the time horizon outlined in the Accord.

 I would like to particularly thank Janet Creaney, who provided invaluable support around data sets and related research and resources.