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Higher Education Reform: What are Pyne’s options for compromise?

29 Sep 2014, by Informa Insights

The Hon Christopher Pyne MP, Minister for Education, Speaker at Informa/AFR Higher Education Reform Summit
The Hon Christopher Pyne MP, Minister for Education, Speaker at the Higher Education Reform Summit

Despite vocal opposition from some quarters, the Abbott government remains strongly committed to its Higher Education reforms– but how will it go about securing the support of the Senate? We asked several of the sector’s leading experts, all speakers at the Financial Review’s Higher Education Reform Summit in November, where they expect to see changes made to the reform agenda.

“University deregulation should be retained at the heart of the package,” says Professor Peter Shergold AC, Chancellor of the University of Western Sydney. “However, I hope that political negotiation will bring about a change to the proposed fee-help arrangements so that low income students are not deterred by the prospect of an increased debt burden.”

“The main compromise must be on the interest rate charged on student debt,” agrees Professor Peter Coaldrake AO, Vice-Chancellor of Queensland University of Technology. “There are several areas where the sector would like to see reductions in funding removed (e.g. CGS) and in reducing the burden on students (e.g. RTS) but it is not clear where offsetting savings can be found. Unless the government is willing to compromise on the budget bottom line there is little scope for major changes.”

Professor Peter Dawkins, Vice Chancellor and President of Victoria University, thinks that a compromise could go further. “It’s very hard to say what will enable the legislation to be passed,” says, “ but the following look likely elements: (1) compromises in relation to the payment of interest on HECS debt; and (2) support for universities in regional areas and universities with high percentages of low SES students. And there may need to be a mechanism for monitoring the efficiency and equity effects of prices and subsidies under the new regime.”

Claire Field, former CEO of ACPET and an authority on the private education sector, also agrees that securing the passage of the reforms may require both changes to the proposed increase in interest rates on HELP loans, and the addition of some transitional funding for universities in regional areas. She also sees room for negotiation on the scholarships scheme. “I see the scholarships scheme as a bit of a ‘sleeper’ in the reforms,” says Field. “There is already some debate on the scheme, because it will allow prestigious universities to funnel their increased fee revenue into large scholarship funds to attract the best and brightest – reducing the number of outstanding students at non-GO8 universities. In addition, the way the scholarship scheme is designed, it will almost certainly lead to fee increases in many private higher education providers in the first year of the reforms. This is contrary to the expectation that introducing government funding to private providers will see them reduce their fees and thus put downward price pressure on the broader university sector.”

Let us know what you think in the comments below, or join the debate on our Higher Education LinkedIn group.

The Financial Review’s Higher Education Reform Summit: Driving the University Revolution takes place on 12-13 November 2014 at the Sofitel, Melbourne.


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