AFR Higher Education Summit address
I have been a Richmond fan all of my life.
We didn’t win anything for 37 years.
It used to be that the definition of an optimist was a Richmond supporter who didn’t book a holiday in September.
I was always an optimist. I never booked a holiday in September.
In the last three years, Richmond has won two premierships and I was there to see both of them, and hopefully we can win another this year.
So, there is something to be said for being an optimist.
And let me tell you, standing here today, along with the Richmond Football Club, I see much to be optimistic about.
Australia’s response to the COVID-19 pandemic has been amongst the best in the world.
And because our response has been so good, our recovery will be the same.
As a nation, we have recovered from shocks before, and we will do it again.
We will recover from this pandemic, and we will be stronger economically, as a society, and as a nation.
I’m also optimistic about the future of higher education in Australia, and let me tell you why.
We have a plan.
Our Government has been reshaping the architecture of higher education.
For the last two years, we have been making the sector more flexible, more adaptable, more integrated with industry and more resilient.
As a result:
I’m optimistic that in response to the challenges posed by this once-in-a-lifetime economic recession, our universities will focus on domestic students like never before.
I’m optimistic that working with the sector we will deliver a sustainable model of research funding.
I’m optimistic that we will continue to get better at working with industry and commercialising our research.
I’m optimistic that Australian universities will continue to be engaged in an interconnected world, collaborating with other countries to drive forward research outcomes.
I’m optimistic that Australia will remain a destination of choice for international students, and that the sector will continue to support local jobs and national income.
This optimism is backed by reality.
We have a plan.
All the pieces are in place to deliver on this vision.
But to realise it, there is still more work to do together. We have to continue to implement the plan.
In April, we announced that universities would receive their full Government funding allocation of $18 billion for the year, regardless of domestic student numbers.
We also heavily discounted microcredentials and moved quickly to have them recognised as qualifications. This was something the Government had planned, and we acted to deliver.
Our Higher Education Relief Package offered short-term assistance. Our Job-ready Graduates package offers the long-term solution.
The Morrison Government wants more Australians to undertake a degree, learn a trade, study a vocational qualification, upskill with a microcredential, start a business or get a job.
There is no one single pathway to success in life, and we want every Australian to have the opportunity to use their skills to pursue their ambitions and to make a contribution to our nation.
And if you have the aptitude, the marks and the ambition to go to university, we want you to have a greater chance of seizing that opportunity no matter where you live. That is fair.
Because the evidence is clear that a degree from an Australian university will make you more employable.
According to the 2020 Longitudinal Graduate Outcomes Survey, nine out of ten university graduates were employed in full-time work three years after graduation.
Compared to those with no post-school qualifications, university graduates have higher earnings – an average of $1,342 per week compared to $820 for those with no qualifications.
Not only does a university degree benefit the individual, it will also benefit our nation.
Our economic recovery will be built on our strengths and that includes an educated and highly skilled workforce.
Australia is going to need more teachers, more nurses, more engineers, more agricultural scientists and more IT professionals.
The best thing we can offer our young people impacted by COVID-19 is a pathway to a realistic job and the economic conditions where jobs are created.
I was pleased to see that last Friday, the majority of the Senate’s Education and Employment Legislation Committee recommended that our Job-ready Graduates Bill be passed.
And I note that Universities Australia has said the sector needs stability, funding and policy certainty, and that our Bill would deliver this.
It is now up to the Senate. They will have the opportunity to vote:
• To increase the number of university places for Australian students.
• To provide more support and funding for regional students and universities.
• To improve collaboration between universities and industry.
• And, to make degrees cheaper for Australians in areas of expected job growth.
We know from past experience that economic downturns lead to upturns in demand for education.
And, our Government wants more Australians to have the opportunity to benefit from a university education.
Because of the surge in demand caused by the COVID-19 recession we need those additional places from next year.
Doing nothing for one or two years will not help the Year 12s of 2020 and the Australians looking to retrain in 2021.
Deferring our economic recovery helps no one and risks scarring a generation.
Our Government has laid out its plan to create more university places for Australian students, with more support for regional students and universities, stronger relationships between higher education and industry, and cheaper degrees in areas of expected job growth.
To further demonstrate our commitment to young Australians, and those who will reskill next year, today I can announce the Morrison Government will provide $326 million for additional university places next year and beyond.
This money equates to 12,000 new places.
We are doing this in recognition of the challenges faced by the Year 12 class of 2020, who have endured a final year of school like no other, and those who have lost their jobs and who need to retrain and reskill to find another.
If the Senate passes the Job-ready Graduates Bill, there will be up to 30,000 additional university places available next year.
That’s more young Australians who will benefit from the opportunity to get a university education.
That’s more Australians who can reskill if they lost their job.
These are real people who stand to benefit. Sons, daughters, husbands, wives, brothers, sisters, neighbours, and friends.
And because of our reforms, about 60 per cent of students will pay less or see no change to the cost of their degree.
If the Job-ready Graduates legislation passes the Senate, we expect up to 20,000 additional Job-ready places will be enabled by the funding arrangements set out in the legislation, with growth in places going to regional, high growth metro and low growth metro, at rates of 3.5 per cent, 2.5 per cent and 1 per cent respectively, building on the 1.3 per cent growth already in the system thanks to performance-based funding, and the newly created national priorities pool.
We can now add to this the $326 million for new places I have announced today.
In short, our Job-ready Graduates package and this announcement today will create thousands more university places for Australians and provide certainty to the sector.
Not only do we need to grow the number of places at university for Australian students, we need to ensure that growth occurs in areas of the greatest need and demand.
For the sake of national cohesion, we must address the gap between the city and the country when it comes to education.
Our reforms help address the discrepancy in this nation where young people in regional areas are half as likely to obtain a university qualification as young people who live in the city.
They address the key recommendations made by Dr Denis Napthine in the National Regional, Rural and Remote Education Strategy.
Charles Darwin University Vice-Chancellor Professor Simon Maddocks told the Senate Education and Employment Legislation Committee that his university desperately needs growth in places.
University of Tasmania Vice-Chancellor Rufus Black told the same committee it was essential for the state’s future to ensure that his university had enough places for Tasmanians, as well as support for socially and economically disadvantaged students.
The Job-ready Graduates package does this.
It locks in growth for Commonwealth supported places at regional campuses at 3.5 per cent a year.
It provides a $5,000 scholarship for outer regional and remote students who relocate, as well as changes to the Fares Allowance that will make it easier for regional students to get home in their first semester.
The Regional Universities Network support the passage of our Bill.
Investing in regional education also pays a dividend for regional communities.
As the Napthine Review says: Increasing the participation of Rural, regional and remote students will directly and positively contribute to the economic and social development of Rural, regional and remote areas.
Analysis conducted by Nous and the Centre of Policy Studies found that if 6,000 more students from regional, rural and remote NSW, Victoria and Queensland attended a regional university it would create an additional 690 jobs and generate an additional $122 million in real GDP.
According to the Chair of the Regional Universities Network Professor Helen Bartlett, this is basically what our Job-ready Graduates legislation will do.
Professor Bartlett said these additional 6,000 students “broadly equates with the impact the 3.5 per cent growth in places the Job-ready Graduates legislation will deliver at regional campuses.”
Our Job-ready Graduates package will provide more opportunities for regional Australians to obtain a university degree and to keep our regional universities and the communities they support vibrant.
Throughout this process, our Government has engaged constructively with the sector to get their input and feedback.
Today I can provide details on the Guidelines to the Job-ready Graduates Bill that have been developed following sector and community feedback that will give certainty to universities and students.
The Bill guarantees the Transition Fund for universities over the next three years and the Maximum Basic Grant Amount floor. The Commonwealth Grant Scheme Guidelines set out the formula for the Transition Fund Loading and specify the minimum amounts for the Maximum Basic Grant Amount that will apply during the next four years.
These clarifications effectively lock in indexation for the next three years at pre-COVID rates and are protected by a Parliamentary disallowable instrument. This provides the certainty that universities have sought.
The Other Grant Guidelines establish the Indigenous, Regional and Low Socio-Economic Status Attainment Fund and the National Priorities and Industry Linkage Fund.
The Other Grant Guidelines preserve the enabling loading as a grants program so that access to higher education is more accessible to more Australians, and the regional loading recognises the additional cost of delivering education outside of cities.
The Higher Education Continuity Guarantee (the Transition Fund) will ensure that over the next three years, the Government will provide funding certainty for eligible higher education providers to ensure that they are able to focus on providing services to domestic students during the recovery from the impact of the COVID-19 pandemic.
This confirms the $2 billion funding increase for universities from this year to 2024.
Today I also publish a discussion paper on the arrangements for the $900 million National Priorities and Industry Linkage Fund that has been designed by a working group of Vice-Chancellors chaired by Professor Attila Brungs of UTS.
The fund has a strong focus on investment in STEM industries and will support universities to produce Job-ready Graduates for their local industries and communities.
Our Government wants to give universities more freedom to be flexible and responsive in their operations.
The Job-ready Graduates package gives universities the flexibility to adjust the number of bachelor, sub-bachelor and postgraduate places within their funding allocation.
That flexibility has been welcomed by the sector.
And we will look at modifying performance-based funding to take this change into account.
The provision of microcredentials within higher education represents a new frontier when it comes to flexibility and innovation.
Our Government offered significant discounts – up to 74 per cent – on the cost of a microcredential to Australians wanting to reskill this year.
The response from universities and Australians has been very positive and demonstrates the demand for high-quality, alternative Australian qualifications.
For example, more than 300 students have enrolled in La Trobe’s Graduate Certificate in Mental Health which ensures health workers have the skills they need to identify and manage their clients’ mental health concerns.
Across the country, we now have 55 providers offering nearly 400 short courses.
The development of microcredentials will drive innovation and provide an additional income stream for universities, while making them more efficient, relevant to industry and responsive to the requirements of domestic students.
We want to create new business opportunities for education providers by cutting red tape and allowing international students to study microcredentials in areas outside their primary course of study – for example, in first aid or the responsible service of alcohol.
In light of the success of our microcredential courses, and their ability to help people reskill and retrain for a job, the Treasurer will have more to say on short courses in next week’s Budget.
Our Government is addressing the needs of domestic students, providing more support to regional Australia, providing more flexibility for universities, and driving integration with industry.
We are working with industry to ensure these reforms meet their needs for the jobs they will be seeking to fill in the future.
BHP is working in partnership with Government and the tertiary sector to create opportunities for people in regional areas to receive skills and training in a range of sectors, not just mining.
The training is supporting access to employment and supporting small to medium businesses.
We also have a plan to address research.
The COVID-19 pandemic has brought the work of Australian researchers into sharp focus.
Every Australian wants the teams of experts working on a vaccine to succeed.
They are the most visible, but think about the myriad of ways that Australian research is being used to fight the virus.
Medical researchers, epidemiologists, data scientists, mental health experts, remote education specialists – the list goes on.
Research is helping us fight COVID-19 and it will power Australia’s post-COVID-19 recovery.
Research will lead to the discovery of new ideas, the invention of new products and the development of better ways of doing things.
Research is the vital ingredient in the creation of new industries, new technologies and new jobs.
But to cash that dividend we need to get better at commercialising our research; better at turning ideas into jobs, productivity gains and growth.
For example, our Government is investing $2 million in the Nowra Agri-business Innovation Hub to connect the regional agri-business sector with the latest technologies and research.
We are providing a further $2 million for a pilot program to teach shipbuilders digital skills to take on high tech jobs at the Osborne naval yard in South Australia.
The Morrison Government recognises the importance of sustainable funding to support research and research jobs in Australia.
I have been working through a range of options with a group of Vice-Chancellors to develop a funding model that will support our research ecosystem.
Next week, the Treasurer will detail our plan for Australia’s economic recovery in this year’s Budget, and I will have more to say on research after that.
Now, let me address the issue of international students.
The absence of international students is being keenly felt. They are valued members of our communities and our lecture halls.
Research commissioned by my department suggests that globally, market conditions are inherently linked with the severity of the virus, because it is a key driver of business and consumer confidence.
While Australia’s border reopening has been delayed, caseloads relative to other markets suggest Australia’s eventual reopening will put us in a strong position.
In terms of Australia’s key source markets, the Asia-Pacific economy looks set to weather the impact of COVID-19 better than most.
States and territories are working on international student pilot programs.
The Northern Territory has become the first jurisdiction in Australia to start a pilot program.
In their case, around 70 international students will travel to Darwin, and I note there is no international passenger arrival cap for the NT, and quarantine arrangements have been put in place by the Territory Government.
Other states are also considering proposals for international student pilot programs.
States and territories will need to consider the changing circumstances of the COVID-19 pandemic in the design and proposed implementation of any pilots, and make decisions in line with advice from health authorities.
The Federal Government remains willing to work with all states and territories on the development and operation of international student pilots.
We emphasise that the priority remains on returning Australians and that closed internal borders are inconsistent with the return of international students.
In conclusion, we are facing the biggest economic contraction since the Great Depression.
There is no escaping that fact.
We can choose to cower or take the challenge on. I choose the latter and I choose to be optimistic.
I am an optimist, because we are working with the sector to reshape our higher education system to make it more resilient, integrated, flexible and adaptable.
We have a plan and we must continue to implement it.
COVID has accelerated our need to reshape the architecture of higher education. This is not easy, but it cannot be put off until later.
We cannot sacrifice the opportunity and benefit that a higher education provides to the individual and the nation at the altar of collective indecision or timidity.
Our Job-ready Graduates reforms will give more Australians the opportunity to benefit from a university degree – and with what I’ve announced today, this includes up to 30,000 extra places next year.
This will deliver more Job-ready Graduates to power our economic recovery, and will give universities certainty and flexibility for the road out of this virus.
The research reforms we are addressing will ensure our research capability is sustainable and better leveraged to support a COVID-19 recovery.
And, both of these reforms will happen in a changed international environment, where Australia is well placed to build and drive its future prosperity.
So, there is much to be optimistic about.
Like a very good team, we just have to work hard together to implement our game plan.