A bluffer’s guide to the Australian Universities Accord

There was a period early last year when there appeared to be a consensus on the need for a “major review” of higher education in England.

The problems faced as a result of contemporary pressures and concerns were deemed to be such that only an independent committee of the great and good, with a soon to be (in)famous chair (Robbins, Dearing, Augar, maybe even Browne) could come up with a way forward.

England did not get such a “major review”. It will not any time soon. But Australia kind of did – in the form of the Australian Universities Accord, published last month.

Context

The Australian University Accord Panel was established in 2022. As the report itself describes, it was charged with the requirements to:

undertake this Review of the higher education system (the Review) and to make recommendations for Government, the higher education sector, and other relevant stakeholders to deliver a higher education system that meets the current and future needs of the nation, with targets to achieve this.

The chair of the review was Mary O’Kane, director of O’Kane Associates, a company specialising in conducting government reviews. She also used to be vice chancellor of the University of Adelaide.

As you might expect, there was a great deal of consultation, with three rounds of submissions, a discussion paper (February 2023), and an interim report (June 2023) that led to legislation on access, stability of funding, and universities as employers.

The positioning of the review is notable when viewed from the UK perspective in which the idea of a tertiary education system has increasing salience. In Australia vocational education and training (VET) is a well established separate system. The panel was charged with considering the way that VET connected to higher education, but a review of VET itself was out of scope. The report did, as we will see, look far more widely than higher education, including to VET, childhood education, schools, and the wider economic issue of productivity.

Australia’s system of higher education includes 202 registered providers, including 42 major “Australian Universities” of which 38 are public universities. Around seven per cent of students attend private providers. Within each part of the sector there are publicly and privately funded courses – the commonwealth of Australia supports undergraduate places for around 55 per cent of students (though there is also a tuition fee). A further 13 per cent of students are home students paying full fees without government support, and 29 per cent of students are fee-paying international students. Student finance is administered through the Higher Education Loan Program (HELP).

Skills needs

Australia needs skills! The Accord proposes a target for 80 percent of the working age population to have a tertiary qualification by 2050 (up from 60 per cent currently), though the detail here is people holding one or more “Certificate III” qualification, which corresponds more to high school level awards.

More notable is the Blair-infused aspiration for 55 per cent of young people (25-34) to hold a Bachelor’s degree or above, up from 45 per cent currently. Again, this is on the 2050 wishlist, allowing for both a good deal of can-kicking about how it would be funded and for a UK-style media backlash to grow.

Failure to achieve these targets, the report argues, will do “lasting damage” to Australia’s prospects of national economic success and social cohesion “by preventing generations of Australians from enjoying the career opportunities and higher incomes that tertiary education makes possible.”

This latter point invites comparisons with UK Labour’s “opportunity mission”, the nearest thing we have to manifesto commitments on HE from the country’s likely next government. The mission document sets out a target of 75 per cent of young people qualified to level 3, 85 per cent in a “sustained destination” of education, employment or training, and 70 per cent of those who’ve completed a level 3 qualification moving onto “higher level opportunities” (which is of course not to say degrees).

The big difference here is that all the targets in the paragraph above are for 2030. Neither the Australian Accord nor Labour’s mission spell out the policy levers and public purse contribution that will achieve the ambitious increase in tertiary level study they want to see. But Australia has given itself plenty of time to plan how this can be done, while the end of the decade looks increasingly close for Keir Starmer.

The Accord also goes big on lifelong learning, recommending the creation of a national skills passport to support an expansion of lifelong learning into stackable and transferable qualifications (including microqualifications and other short courses), which will include the regularised recognition of prior learning. HELP would also need adapting to allow access to student finance for shorter courses and microcredentials.

This move follows a broader policy trend, manifesting in England in the form of the Lifelong Learning Entitlement, concerned with the value or necessity of facilitating upskilling and reskilling for those already in the labour market. Reconciling the potential tensions between the purposes and processes underpinning shorter, flexible, skills-focused qualifications and longer integrated degree programmes would be the job of an updated Australian Qualifications Framework.

In Westminster the expectation seems to be that form will follow funding, with stackability implicitly expected to manifest in the system as a result of reorganising the finance system. The Accord sets out a more robustly multidimensional infrastructure that would need to be in place to move a stackable credit system forward – but as in the UK much will still depend on the willingness of higher education providers to develop new provision, and the practical feasibility of them doing so.

Expanding opportunity

The Accord report argues that overall participation targets will not be met without increasing participation from historically under-represented groups. It proposes national targets to increase the numbers of First Nations, low-income, and disabled students and people from regional, rural and remote communities. The aim would be to achieve parity of participation by 2050 – a goal the reviewers concede would be “an exceptionally challenging task.”

To achieve it, participation targets would be accompanied by completion targets identified and monitored through mission-based compacts – likely not a million miles from our outcome agreements or access and participation plans, except that this could come with a completion bonus for providers who meet their targets. There would also be a “needs-based” funding model that would channel additional funding to universities to support pedagogy and support enhancement and programmes to improve outcomes for students from under-represented cohorts.

For UK readers, the recognition of Accord of the costs of providing serious high quality support to under-represented students may provide a useful reference point in national arguments about funding – in England, a once-significant direct grant to universities for exactly this purpose has been pared back to the barest of minimums.

In Australia they are known as preparatory courses (formerly enabling programmes) – lasting from a few weeks to an entire academic year. Here in the UK the closest analogue is the foundation year. In recommending an expansion of the number of fee-free places on these courses, making participation at this level free for any Commonwealth supported student, the proposal is an increase in investment in such provision – the opposite direction to the one being taken in England.

The report notes that funding and availability for these programmes is variable – due in part to a mishmash of previous incentives – so the intention is that funding should meet the cost of provision based on student demand, rather than reflect previous allocations.

Elsewhere the Accord recommends a doubling in supported student places overall; this includes an increase in medical places which will give a place to all First Nations students who meet entry requirements. There’s a call for consistent careers advice, and work on equal participation will be subject to annual reporting and bolstered by the dissemination of successful practices. A number of measures are proposed to remove financial barriers to participation, such as raising the means-testing threshold on parental income, extending eligibility for income support payments to part-time students, and financial support for placements.

Students at the centre

“Students at the heart of the system” – now where have we heard that before? There’s a lengthy analysis here of the limitations of the HELP system – the Accord argues that while the fee and loan system is correct in basic principles, it requires modernisation and efforts to “reduce the long-term financial cost of studying for students.”

The big shift here is on maintenance support, which would under these plans be fully needs-based, and pro-rata income support. Given the pressures on student maintenance over here, and the public finance implications, the political response to the Accord’s proposals will be observed with interest. There’s tweaks to repayments too, which is suggested will remove barriers to work – these come alongside recommendations to the banks that administer these loans to ignore them when considering mortgages.

The second part of the chapter considers broader student experience, notably acknowledging the difficulty of measuring student experience and outcomes. The review recommends a national Student Charter – co-created and co-owned by students – that would constitute a national commitment to student welfare, safety and wellbeing, underpinned by a national student code that would outline legislated requirements for timely and fair complaints processes. A student ombudsman is already being considered as part of the Australian government’s plans to address gender-based violence in HE – the Accord suggests this role could cover all kinds of student complaints on issues covered by the Charter.

Student representation gets a boost with a proposal to ringfence a proportion of the student services and amenities fee that Australian institutions are permitted to charge in addition to tuition fees, for student-led organisations to protect their long term sustainability.

A section on teaching quality proposes that professional standards be developed for Australian HE teaching, equivalent to the UK professional standards framework, and that higher education providers should be required to report how many of their staff hold a teaching qualification (those with longish memories may recall a similar proposal for England, which never got implemented in full).

The new regulator would have a role in developing and disseminating good practice examples of teaching – including discipline specified digital repositories hosted by different institutions on behalf of the sector as a whole – and developing new metrics for measuring learning and teaching quality.

A discussion of international student experience takes in issues around city campuses, pressures on housing, English language proficiency, and visa requirements, culminating in the recommendation for a nationally coordinated strategy for international education that enables sustainable expansion while maintaining the integrity of the system. We can but hope for something similar over here.

There’s a recognition of the reality that students work part time during their studies – the Accord proposes a National Jobs Broker to match students with suitable work, and there’s a parallel interest in expanding work related learning. Australia’s National Union of Students has been campaigning to end unpaid internships throughout the year, arguing that expecting students to support themselves throughout this period is unfair.

National recognition of students’ needing suitable part-time work is sensible, though we question how likely a student jobs strategy is to come from the government, and wonder whether providers should be encouraged to consider student employability strategies at a local level. This could include working with local businesses, and other local institutions, to develop a shared strategy for paid student opportunities.

It may also mean addressing assumptions that students should have jobs at the “bottom” of the run or in jobs deemed low-skilled like hospitality or retail. Roles within professional services in universities, or local businesses, could be made suitable for students – and having more students involved in the running of services internally may make them more responsive to students’ needs.

Providers are asked to offer exit awards to recognise the work of students who don’t complete their intended course. And at the other end of the journey, the practice of making “early offers” to those in their last year of school would be curtailed.

There’s also a belter of a data recommendation – that Australia’s unique student identifier should be used across the whole tertiary system, supported by alignment of data standards and practices.

New knowledge

The research end of things brings a recommendation for another review – “a formal, strategic, cross portfolio examination of national research funding” – to inform a multi-agency strategy that sets targets for R&D spending as a percentage of GDP. The multi-agency emphasis speaks to a familiar situation – while Australian government spending on research is in line with international comparators, business investment is far lower than could reasonably be expected.

To that end, the Accord frets about engagement between universities and end-users of research without necessarily proposing that a single model be adopted: Interface Scotland gets a nod as one possible option. There is also a proposal for the creation of a Solving Australia’s Challenges Strategic Fund to reward “real world” impact. We also see a drive to encourage businesses to support staff in gaining PhD level qualifications, and in employing candidates in relevant fields. This is coupled with recommendations for government investment and promotion of the Research Training Programme.

The good news for universities is a solid recommendation that “universities charge, and governments and industry pay, full market rates for commissioned and contract research and consulting” – the full economic costing for research that remains a bone of contention in the UK as elsewhere. The potentially less welcome proposal is for the advent of a REF-ish National Research Evaluation and Impact Framework, incorporating research quality, impact and national data strategy, to replace the current Excellence in Research for Australia framework which is considered overly burdensome. A key difference is that the new framework would be more data driven and use “intelligent technologies” to automate research assessment to a certain extent.

Underpinning the whole funding debate is the positioning of research as a national asset. The Accord speaks with a frankness that is sometimes avoided in UK reviews that funding university research through international student fees jeopardises the whole country’s research system due to the inherent risk of a “major global event or other funding shock.” To offset this shock the Accord proposes not only more funding for research but different kinds of funding including covering indirect costs through grants, and greater direct investment in research by the government. Together with full economic cost of research the idea is to increase internal capacity, reduce the reliance on external funding, and in turn improve international research competitiveness.

Dynamic system

The Accord proposes the creation of an entirely new regulator, boasting the unwieldy name of the Australian Tertiary Education Commission (ATEC) and reporting to both the Minister of Education and the Minister of Skills and Training. There’ll be a big investment in data capacity (including the student identifier stuff mentioned above and work on platform integration) to inform the early identification of challenges and issues, summarised in the publication of an annual report and a rolling triennial plan. One area to keep an eye on is a TEF-ish Teaching Quality Framework based, like ours, on metrics and peer review.

ATEC would have the following functions:

• policy coordination and development for higher education and university research, and joint development of policy initiatives on tertiary education with the Skills and Workforce Ministerial Council
• system planning
• negotiating mission-based compacts for universities
• pricing authority for the higher education sector
• funding allocation for the higher education sector
• facilitating wide engagement with the tertiary education system
• strengthening First Nations representation and self-determination
• advising the Minister on regulatory frameworks within the higher education sector
• overseeing and monitoring of the Australian Qualifications Framework
• accountability, quality and performance
• improving data and metrics

The current Tertiary Education Quality and Standards Agency (TEQSA) and the Australian Research Council will become directorates of this new body, and there’s also the suggestion of merging in the Skills Quality Authority. Those who worry about how language in regulation affects the actual thing may appreciate the use of the term “stewardship” as a framing purpose for regulation.

The Australian government is also charged with the establishment of a Centre of Excellence in Higher Education and Research to provide the evidence and intellectual heft that would inform regulation. And there would be additional reviews, including a study on racism in the system, work on professional development, and a First Nations-led review of governance. A brief assessment of the state of the workforce offers a critique of casualisation and sounds a note of concern over the increase in non-academic roles – both issues that the UK system could do with grappling with, and which it is currently not set up to influence.

Currently, universities in Australia are quality assured by TESQA which has a register of providers, quality assures them against a Standards Framework, and also gives strategic advice to ministers on these matters. Actual funding flows directly from the government. ATEC, in contrast, is very much a funding council which will have regulation and research grafted into it – Australia’s very own HEFCE (albeit with a much greater role in the vocational education and skills sector) or a reincarnation of the pre-1988 Commonwealth Tertiary Education Commission (CTEC). There’s even a suggestion it takes on the role of the current Australia Skills Quality Authority in lower level VET.

To readers more used to UK reforms, this might feel like a retrograde step – though OfS and the rest are all funding councils too, despite the modish regulatory trappings. In shifting the majority of tertiary functions into an arms-length body, the Accord is addressing a recent history riven with piecemeal initiatives, burdensome duplication, and poor quality data.

On the latter there’s a serious attempt to drag the sector into the future – an attempt to piece together systems, standards, and definitions that work for everything the new commission would regulate. There’s clearly been some serious thinking about the need to spot future issues as they arise and take appropriately informed action – Australia has no HESA, and current data collection is not up to the job of supporting the level or quality of analysis the Accord calls for. This data would also inform the proposed Centre for Excellence in Higher Education and Research, which would centralise and promote a deep knowledge of the system to inform planning and development.

The future planning role of the Commission is noteworthy – the regulator would be responsible for anticipating future needs and convening strategic planning that could address issues like cold spots, managing of volume increase, and supporting diversity of provision. That’s something that’s perceived to be sorely needed in England, at least, but the reality of which could cause tensions – if it ultimately placed limits on institutional self-interest there would be a bit of a learning curve in some quarters.

The regions

Cold spots, and underserved areas, are somewhat larger in Australia than the UK, to the extent that the location of a provider in a remote region can carry significant additional costs. These are recognised as a specific element in the needs-based funding model (see below) which aims to cover the additional expense involved. There could be more support for regionally based end-to-end medical schools, addressing the need for trained graduates.

Students will benefit from a relaxation of the rules around commencing a course within 12 months of completing school – the timing of payments will also be shifted to support the very expensive business of relocation.

For places with no provision at all there would be an expansion of the Regional University Study Hubs, following an evaluation of the effectiveness of the current approach. And more speculatively, the role of the Regional Education Commissioner could be beefed up in a mini review – even a “National Regional University” could be on the cards – due to report in June 2025.

The full formulation is “regional, rural, and remote” – it’s clear that Australia is dealing with a set of circumstances very different from UK notions of levelling up. Though cold spots in the UK (on the east coast for example) may be very different in character from your more traditional university towns, we don’t have to deal (in England at least, you could argue that it could apply to some of the Scottish Highlands) with genuine remoteness and the challenges that this bring. Even the least well served areas in the UK have a provider within 100 miles, there are parts of Australia where this is an order of magnitude bigger.

From this section the use of student facing funding pre-arrival is something that could helpfully be adopted here – the costs of moving away to university are large and upfront, and if we want non-traditional students to benefit from the traditional experience this might be one way to make it happen. On the possible “National Regional University”, the University of the Highlands and Islands may serve as a useful model.

Funding and finance

Given all the above, Australia clearly needs a new model for funding higher education. And in a moment of supreme anticlimax the Accord agrees – before asking the government to adopt one that the new Australian Tertiary Education Commission would need to get on and develop.

The parameters are fairly tightly set in the recommendations – it would be a mix of demand driven and planned capacity, would include fee-free preparatory courses, cover the costs of teaching and scholarship, stop offering only partial funding where there is over-enrollment, and also enshrine freedom of enrolment and financial choices for provider. All against a background of growth in student numbers.

The Accord recommends that the mixed model of student finance including a student and government contribution should prevail, with no numbers caps (particularly not for students from underrepresented backgrounds), and increasing fidelity over time on the costs of teaching students, with additional costs based on student backgrounds and location accounted for.

Most controversially the Accord proposes a $10billion Higher Education Futures Fund created through joint contributions from universities and government (with universities with the deepest pockets and historic advantages paying in the most) and that would provide infrastructural support (physical and digital) for future growth, including provision for student housing. The idea that universities should pay a “future tax” hasn’t gone down especially well in some quarters but it’s potentially quite an elegant solution to the problem of short-termism in government and the perennial issue that post-compulsory education tends to come in well behind such considerations as public health, schools, local services, and the like, in the priorities of voters.

Overall, while there may be unease in universities at the Accord’s proposals – essentially, (re)orientating higher education towards the contemporary understanding of the national interest and using a combination of funding and regulation to achieve a fairly activist agenda – these are highly considered proposals, ambitious in scope, and cognisant of the reality that if a government wants excellent higher education it has to fund it. That said, it’s probably just as well there’s no final bill provided tallying up the fiscal impact of all these proposals, as it could be truly eye-watering.