Letter from Australia: The 40 per cent factor

In 2017, 40 per cent of people in Australia between the ages of 25 and 34 held a bachelors degree. Big deal, you might well say. In the same year, 44 per cent of Brits in that age group held a degree. In South Korea, the figure was 48 per cent.

In Australia the 40 per cent figure has reached a somewhat mythical status. It came out of a 2008 review of higher education by Denise Bradley that decreed that by 2020, 40 per cent of young Australians should have a BA, BSc, LLB, BEng – you get my drift – after their name.

The sector is very proud of its track record in this regard and does, from time to time, engage is a spot of mutual backslapping. And three years ahead of schedule! Amazing, right!

I was aware that we had reached 40 per cent some time ago but lazily presumed that the spike in attainment since the Bradley review had released its recommendations had been driven by the female factor – the fact that 58 per cent of young women now go to university.

But in a pre-election policy pitch called Commonwealth Orange Book 2019, the Grattan Institute – arguably our finest and most sensible think tank – noted that migration had, in fact, played a very big role.

“Counting only people whose attainment is linked to higher education policy (ie, the demand driven system), Australia was at the lower end of the attainment range in 2017,” the Grattan report says.

The figure, when one considers domestic students only and not those who imported their degree as a result of skilled migration programs, is a much more sombre 35 per cent – and only 32 per cent of people born in Australia.

In 2008, when the Bradley review was written, the figure was 29 per cent. So after all that time and all that money pouring into the system (teaching grants reached $7.1bn in 2017, more than 50 per cent higher than in 2008), the increase in attainment is somewhere between 3 per cent and 6 per cent. Is that a back-slappable achievement?

A failure of the system

So I rang Andrew Norton, the Grattan’s higher education policy dude, to have a chat about it and I asked him straight: is this a failure of the system? Norton, a measured and poised individual, snorted quietly. “No. It’s not a failure of the system,” he told me.

So what’s going on? Well, first up, when the Bradley review team came up with their targets, there was no data about which degrees were earned in Australia and which were earned overseas, nor did it distinguish between citizens and non-citizens.

“So we don’t actually know what the Australian-born base was,” says Norton. He says there were very large numbers of permanent residents and citizen migrants who were entitled to a Commonwealth Supported Place, but they were not identified as such in the Australian Bureau of Statistics’ report Education and Work.

“Given we have had a skill-based migration program for a very long time, it is having an enormous impact on the attainment rate,” says Norton.

And also, he points out, that by 2017, only the first cohorts from the demand-driven system were reaching the 25-34 year old age group. “The attainment of local students will push up fairly strongly as time goes by and they get older,” Norton points out.

A second target

Denise Bradley also named a second, some would say more important, target. That was that by 2020, some 20 per cent of low socioeconomic students would be participating in higher education.

Now, this has been altogether patchy area of success for universities. Data from the National Centre for Equity in Higher Education shows that in 2012 there were 99,838 low-SES students enrolled in higher education, a figure which had increased to 12,554 – a 29.8 per cent hike – by 2017. Just as Bradley wanted.

But we know there have been areas of abject failure, such as participation rates among rural and remote students – who usually also correlate with low-SES – has barely shifted since 2010.

Despite the big numbers, the proportion of low-SES students going to university increased only slightly as a proportion up from 15.5 per cent to 17.1 per cent – well below the 20 per cent target and a pretty clear indication it would not be reached by 2020. Which makes one wonder what hasn’t been done – given the huge investment via the demand-driven system and targeted equity programs such as the Higher Education Participation and Partnership Program.

Norton says that while low-SES enrolments grew at a faster rate than overall enrolments, and that universities have been falling over themselves to enrol low SES students, as we get closer to the magical date next year, a number of other factors are now in play which are likely to see the proportion drop even further. We are talking demographics and the fact that mature age enrolments (which are much more likely to be low-SES) are starting to fall off due to a healthy economy and saturated demand.

So, at this stage, with 2020 just seven months away, it looks like neither of those targets will be met. Which might be just as well that Chrisopher Pyne (an ex-education minister) abandoned them in 2014, dismissing them as social engineering.

Do we care?

Norton, who is a pragmatist, simply says: “My view is, we shouldn’t pick arbitrary targets. We should just look at whether it is in someone’s interests to get a higher education and if so we should facilitate that choice. I think we have done that and we shouldn’t be too fussed if we are not meeting some arbitrary target set a decade ago.”

But, like me, many people are attached to those targets. They have meaning because they are aspirational and the whole thinking and philosophy behind the demand-driven system are coalesced around these two numbers. The move to cap funding for universities at 2017 levels – effectively bringing an end to the demand driven system – means that they are even more unattainable than ever.

In the Orange Book, the Grattan Institute says that universities seeking to maximise average per-student revenue will reduce their student intake. Numbers could fall dramatically.

At the same time, demand is weaker with fewer people applying to go to university and commencing undergraduate enrolments actually dropped by 1.8 per cent in the first semester of 2018, compared to 2017. Numbers aren’t in yet for 2019. And, unless the current policies are reversed, Grattan is predicting that by the mid-2020s, “a lower proportion of school leavers will complete higher education than today”.

Which would be fine if they had a decent vocational stream to go into (which they currently don’t). And it completely undermines the underpinnings of the Bradley review which was seeking to create a job-ready workforce for an emerging knowledge economy.

Maybe the mob behind the current crop of higher education policies are banking on the prospect that we will still be digging coal out of the ground in 2025 and that’s where they see the jobs as being. They are wrong, of course. Very wrong.