The Rudd Labor Government will transform Australia’s higher education and vocational education and training (VET) institutions over the next decade with a new $11 billion Education Investment Fund.
From the 2007-08 and 2008-09 Budgets, $5 billion from the surplus will be directed to the newly created Education Investment Fund (EIF) in addition to assets totalling$6 billion from the Higher Education Endowment Fund (HEEF), with the potential for money from future surpluses to be channelled into the fund.
The EIF is a major component of the Rudd Government’s Education Revolution.
This investment is about building a modern, productive Australian economy to meet the challenges of the future.
The key priorities of the EIF will be capital expenditure and renewal and refurbishment in universities and vocational institutions as well as in research facilities and major research institutions.
Unlike the HEEF, which allowed only for the interest earned to be spent, there will be no cap on yearly allocations from the EIF.
This means that substantial investment can be made in our educational institutions in the coming years, transforming the capacity of these sectors to educate and train Australians.
Decisions about annual disbursements from the EIF will occur through the annual appropriation process, which will ensure transparency and allow parliamentary scrutiny.
Annual levels of investment will take into account the sectors’ needs and overall macroeconomic conditions.
There will be no disbursements from the EIF in the 08-09 financial year to ensure allocations align with the recommendations of the Higher Education Review and priorities of universities and vocational education and training sectors.
The Future Fund Board of Guardians will be responsible for managing the fund.
The EIF will have an appropriate advisory board to advise the Minister for Education, and the Minister for Innovation, Industry, Science and Research on research matters, on the relative merits of funding applications.
The HEEF advisory board will be involved in the transition to the new EIF advisory arrangements.