Release type: Speech


Universities Australia Conference - 4 March 2009 - speech



With the Bradley Review of Australian Higher Education now released, read and thoroughly debated we can begin the process of change.

This is an important moment, not only for our students, academics and higher education institutions, but for the entire nation because our future prosperity depends in large part upon our success.

This isn’t the first time in our modern history that Australia has had to radically improve its performance in higher education.

The Menzies, Whitlam and Dawkins eras transformed a tiny, boutique higher education system into first an elite, then a popular, and finally a mass system.

These were big changes – even revolutionary at times – that spoke well of the resilience and capacity for innovation of our higher education sector. But as necessary as those changes were, the task today is far greater and more urgent. Events are forcing us to make new calls on our higher education system. We must have new and greater expectations.

In an era when investment in knowledge and skills promises to be the ultimate determinant of national and individual prosperity, Australia is losing ground against our competitors.

National participation and attainment in higher education is too low.

We are losing touch with the OECD’s leaders in higher education. Between 1996 and 2006, we slipped from seventh in the OECD in terms of attainment among 25 – 34 year olds to ninth.

Too few young people from disadvantaged backgrounds are enrolling.

Completion rates, estimated by Bradley to be 72 per cent, are unacceptably low.

Our academic workforce is ageing and many of our best are being lured overseas.

Student staff ratios have climbed from 13:1 in 1990 to 20:1 in 2006.

Student satisfaction with teaching and assessment has remained static for the past decade.

Despite these facts, our universities have been able to do some remarkable, high quality work. For very good reasons, our universities continue to be sought out by students from around this world.

But these facts are indicators of a sector now facing serious questions.

The problems are compounded by:

  • An allocation of resources to institutions that has been at best opaque, and at worst has been politically determined.
  • A lack of objective benchmarking of teaching quality and performance.
  • Student choices have been unnecessarily limited and funding for places has been micro-managed.

Australia has reached a critical juncture. As a nation we failed to make the boom years pay. We underinvested. We lived off the human capital accumulated in previous decades.

In higher education we now have a choice. We can address these problems, regain touch with the top-ranked nations or watch our prosperity decline. This decline may happen slowly, imperceptibly even, but without further reform in higher education itwillhappen.

My optimism that this challenge can be met is based on a simple fact – we’ve met such challenges before. We can do it again. We will do it again.

Ladies and Gentlemen, over the next week I will be making three major speeches on the crucial issues at stake, outlining the Government’s immediate response to Professor Bradley’s challenge.

Tomorrow I will be discussing the importance of improving vocational education and training outcomes and next Monday I will be discussing the serious issue of educational equity. The full detail of the Government’s response will be released in May at the time of the Budget.

Over the same period my colleague, Senator Kim Carr, will be addressing the implications of the Cutler report on innovation and Professor Bradley’s recommendations on research in higher education.

Today however, I want to concentrate my remarks around the need for major structural reform of the Australian higher education system.

My message is this: we must focus on students, their experiences and pathways, the knowledge they gain, the skills they will use, the public good they will achieve.

Much of the debate so far has taken us away from this central focus. Institutional architecture is important, but not as an end in itself.

A new approach is needed, one based on acknowledging the primary importance of students. An approach that moves from government dictating and rationing the supply of university places to an approach where our task is to meet and fund the needs of Australian students.

Such an approach is essential to enable this country to participate fully in and benefit from the global knowledge economy. Funding that meets the demands made by students, coupled with exacting targets, rigorous quality assurance, full transparency and an emphasis on equity, is the only way Australia can meet the knowledge and skills challenges confronting us.

Professor Denise Bradley has done the nation an important service in identifying and articulating so eloquently the importance of this huge task. She and her review panel deserve our strong thanks and appreciation.

I also want to thank Vice-Chancellors and others for participating in the roundtables and discussions we have had over the past few weeks about the Review. This has been a process I have valued. I appreciate the generosity of your time and having the benefit of your thinking.

I particularly appreciate the efforts of those who have tried to look beyond pleading the case of their institution to answering the question: what can be done to pursue the nation’s best interests?

The vision

The Rudd Labor Government’s vision for Australia is to make it a stronger and fairer nation, a nation with the resilience to stand firm in the hard times and the agility to maximize the benefits of the good times.

To be a stronger and fairer nation, the Australian people must be amongst the most highly educated and skilled on earth.

This is a vision for all Australians not just a few Australians. Our nation will never be at its best if we ignore the skills and capacities of those who are not born into privileged positions.

At the same time, our nation will never be at its fairest if we under-develop the talents and abilities of our most gifted.

To build strength and fairness, resilience and agility, higher education is one of our most important tools.

As Minister for Education I view it as one of my most important tasks to sweep away the false image painted by the rhetoric of the Howard Government that higher education was ivory tower education with no connection to the lives of Australians generally.

The Liberal Party wants Australians to forget that every one in the nation relies on the skills of the doctors, teachers and engineers taught in higher education. To forget that we all benefit from the ground breaking research - whether that be the cervical cancer vaccine or saving the Great Barrier Reef or building more sustainable cities – taking place in higher education.

To forget that the prosperity of the nation overall is linked to our knowledge intensity and that as a result every single Australian has a stake in the quality of our higher education system.

Higher education is pivotal to achieving environmental sustainability, improving social inclusion, engaging with our region and strengthening the institutional framework of our democracy.

It also enriches our lives in ways economists and statisticians can’t measure but which philosophers have understood for two and a half millennia - by creating knowledge and nurturing the flowering of arts and literature.

Improved systems of teaching and research will give us the means to increase and to spread these benefits.

The question is: how?

Just as the Dawkins’ changes found a new way of achieving these goals – through the creation of a unitary system, with massive expansion underpinned by greater student contributions – we need to find a new path.

Professor Bradley’s Review gives us that new way through the creation of a new student-centred, demand-driven higher education system.

Our goals

Professor Bradley sets us two major challenges.

Firstly, to increase the proportion of young Australians with an undergraduate qualification and secondly, to put Australia in the top group of OECD nations for investment in university research and knowledge diffusion.

Other comparable nations have set exacting targets for participation in recent years. For Germany the target is 40 per cent. For Sweden and the UK it is 50 per cent. For the Irish, it’s 72 per cent.

The Government accepts this challenge for Australia.

Through the Council of Australian Governments we have set out to halve the proportion of Australians aged between 20 and 64 years without qualifications at certificate III level or above.

Consistent with this I announce today that our ambition is that by 2025, 40 percent of all 25-34 year olds will have a qualification at bachelor level or above.Not just to have enrolled in higher education, but to have completed an undergraduate degree. Today that figure stands at 32 percent.

The aspiration to enable 40 percent of young adult Australians to gain a bachelor’s qualification is attainable, competitive with other nations and looks to our future needs.

The goal is ambitious while giving a slightly longer time frame for its achievement than that advanced by Professor Bradley.

It is my hope this aspiration will not only be met but surpassed.

The Government came to office with a plan to raise the proportion of young people achieving Year 12 or an equivalent qualification to 90 percent by 2020.

This remains a centerpiece of our Education Revolution.

But the path I am setting out today takes us beyond that goal. It raises the expectations we have of our young people and their parents, and of our great institutions. It asks them to be bolder and more ambitious in what can and should be achieved.

Reaching this goal is going to take an enormous effort, not just to lift enrolments but to engage and retain students by supporting teaching quality and enhancing the student experience. It is a challenge for every aspect of university life.

New drivers in the system

Professor Bradley has also recommended an essential change in the way we fund higher education so that it meets the needs of all three major stakeholders: students, employers and the institutions themselves.

Most fundamentally, she has recommended we move from funding institutions to funding students - letting student demand, moderated by public and university priorities, determine where public dollars go.

The Government accepts the principle of this new demand driven funding system.

I therefore also announce today that all Australian universities will be funded on the basis of student demand from 2012.

This means that we will fund a Commonwealth supported place for all domestic students accepted into an eligible, accredited higher education course at a recognised public higher education provider. Universities will not receive funding for places they do not deliver.

The current funding floor for universities will be maintained for the calendar years 2009, 2010 and 2011. This will give under-enrolled providers certainty, in the form of a limit on how much funding they can lose for places that they do not provide. This will help them to re-position themselves for the new system.

And the current cap on over-enrolment will be raised from 5 to 10 percent from 2010 and then wholly removed in 2012.

This approach will allow a sensible, managed transition to the new system. It will ensure that institutions do not grow too quickly at the expense of quality. It will enable a period of adjustment and planning to occur.

Let me be clear about one important point: this is not a voucher.

Students will not be receiving a set dollar entitlement to be redeemed at an institution of their choice. Rather, there will be a Commonwealth payment to universities – with the amount varying depending on the course – on the basis of student numbers.

The Government’s higher education policies are based on enduring principles including:

  • the importance of opportunity for all;
  • academic freedom and autonomy;
  • research that advances knowledge and critical thinking; and
  • access to university based on merit not ability to pay.

Removing the HECS price caps would be contrary to these principles and the commitment we took to the last election. We have no plans to lift these caps at the very time we are seeking to grow participation.

Our approach is not ideological it is practical.

The public interest will drive the Government’s implementation of these reforms.

The public interest requires our higher education system to be strong across the country including in regional Australia, our outer suburbs and growth corridors.

The cost of providing quality teaching and research in regional Australia will be examined and a new, more logical basis for funding will be introduced.

And where necessary Government will support students and universities to undertake and provide studies that are critical to the needs of our economy and the national interest.

But a student centered approach, with clear and strong public interest oversight, is the way forward for university funding in the 21st Century.

A new approach to quality

Professor Bradley makes the point that focusing provision and funding around the needs of students demands a new approach to quality assurance, accreditation, and regulation. This is a central feature of the public interest approach underpinning our reforms.

It is crucial because more responsibility will devolve to students and to institutions. It is vital because both domestic and international students will need to know how our institutions are performing. It is essential because taxpayers will need to see not just whether value for money is being delivered but whether the national interest is being well served.

I am therefore announcing today that the Government will establish a national regulatory and quality agency for higher education.

The regulator will accredit providers, carry out audits of standards and performance, protect and quality assure international education, streamline current regulatory arrangements to reduce duplication and provide for national consistency.

I understand the anxiety some will have of more red tape and managerial control. That is not the intention and it will not be the effect.

We have to know where we are succeeding and where we are failing if our investments are to be effective.

A key task will also be to establish objective and comparative benchmarks of quality and performance.

Richer data will be collected. Performance in areas such as retention, selection and exit standards, and graduate outcomes will be important. A priority will be to continue to encourage our academics to value teaching as much as their passion for research.

Having a national approach is vital so that students in different states and regions can be assured that the offerings of our institutions have been tested and assessed in a consistent and transparent way.

The role of a university is unique in our society. It carries with it the weight of history, and, as I have said, a good measure of responsibility for our future.

The right to be designated a university must be earned rather than taken at face value. The measures we are taking – to fund the preferences and needs of students and to establish stronger public accountabilities – will place a considerable onus on our universities.

The future of Australia’s higher education system rests on its quality and on its reputation.

In fact that is a dynamic facing education as a whole in Australia.

Those of you who have followed my approach to school reform will know that one of my bedrock beliefs is that reform must be accompanied by improvements in quality and transparency.

I am determined that quality improvements and the meeting of national goals will be achieved so the international reputation of our universities and the qualifications they issue will be among the best in the world.

We have some excellent individual universities in Australia. Our reforms will enable that excellence to continue and to be enhanced. But we will also create the conditions for an excellent university system.

‘Politicians out, students in’

I want to emphasize that whilst rigorous and effective, this will not be a system of micro management from Canberra.

Command and control from Education Ministers and DEEWR will be replaced by clear public interest tests and goals, agreed compacts and transparent oversight by the new independent national regulatory body.

The era of directives about what Australians can study and where – and the culture war waged by politicians against subject offerings, course content and research subject matter – are over.

If I could characterise this system in just four words it would be this: ‘politicians out, students in’.


The case for a new approach to higher education as outlined in the Bradley Review is clear and compelling.

We must have new and higher expectations of our higher education system. The Government will now pursue substantial improvements to our higher education system as a central part of its economic and social reform agenda.

It’s true the Review was initiated in easier economic times, before the Global Financial Crisis. But I want to make it absolutely clear that we will not be walking away from its warnings or from its major recommendations. Budgetary constraints will affect the immediacy of our response. We can’t implement it all today or tomorrow.

But what we can do is get the settings right for the longer term so our students and our universities can decide their role in Australia’s future without political interference and our nation’s knowledge and skill needs can be met in an efficient and transparent way.

Australia must and will become a leading knowledge economy and higher education reform will give us the means to do so.

Thank you.