Last week the government made two substantive amendments to its student places capping bill, officially named the Universities Accord (Opening the Doors of Opportunity) Bill 2026. One amendment gave public universities a floor number of Commonwealth supported places. The other restored two limits on ministerial conditions.

This post explains these changes and comments on whether they remedy the underlying defects.

In summary, ATEC will have a floor number of CSPs that it must allocate to each public university, but the problem of automatic cuts for universities with growth places remains. The bill also still lacks a corresponding requirement on the minister to set a CSP ‘total allocation pool’ of places sufficient to cover all public university floor CSPs.

The two restored limits on ministerial conditions are an improvement, but the bill still lacks appropriate mechanisms for adding necessary but limited conditions.

Floors on places

The policy intent, as expressed in the bill’s explanatory memorandum, was always to provide a floor number of CSPs for public universities.

This floor was to be the university’s ‘core student load’.

Using the 2028 allocation year as an example, the bill defines a university’s core student load as the lesser of:

• Its ‘domestic student profile’ for the immediately preceding year, i.e. its core student load for 2027 plus its additional growth allocation, if any; or
• The number of CSPs it delivered in the most recent year with verified data, which will be 2026 CSPs verified in April 2027: bill section 30-25(1).

But instead of making the lesser of these figures the floor number of CSPs, under the bill’s original section 30-20 ATEC’s CSP allocation for a university ‘must not exceed’ the lesser of these two numbers. ‘Must not exceed’ clearly implied that the number could be lower.

The amendment changes ‘must not exceed’ to ‘must be equal to’, which creates a floor.

A floor will often mean cuts to domestic student profiles

While the bill now creates a floor number of places it can, and I believe often will, still result in automatic year-on-year cuts to universities’ minimum domestic student profiles. This is due to the historical nature of verified data.

In my Senate inquiry submission I used an example to explain how this will happen:

University A was allocated 1,000 CSPs for 2026 and delivered exactly 1,000 places, knowing that the government dislikes over-enrolments.

 For 2027 University A gets an additional growth allocation of 100 places, so its total domestic student profile is 1,100.

In April 2027 University A’s 2026 data is verified, confirming that it enrolled 1,000 places.

Under the section 30-25(1) formula the verified 2026 CSPs of 1,000 is lower than the 2027 domestic student profile of 1,100. University A’s core student load going into 2028 is therefore 1,000, wiping out its additional growth allocation.

ATEC can top University A up with a further additional growth allocation, especially if it knows, from enrolment projections, that University A used its growth places on additional commencing students and fully used its 1,100 places in 2027.

But if ATEC does not top up places then University A in 2028 will have a maximum of 1,050 places: its 1,000 places carried forward from 2026 and its 50 places over-enrolment limit, 5% of its domestic student profile.

Under the current section 36-25 of the Higher Education Support Act 2003 University A’s first obligation is to continuing students, so it will need to cut commencing 2028 students compared to 2027 to stay within its overall CSP cap.

As an additional point, even though the government wants to limit over-enrolments the logic of the automatic cuts provision is that universities should aim to slightly over-enrol as insurance against potential cuts two years later.

Partial solutions

There is no complete solution to this problem under the proposed model. With no new money in the forward estimates, the government needs to minimise unused CSPs to achieve its participation and attainment targets. If a university is genuinely under-enrolled its unused CSPs need to be moved.

In my Senate inquiry submission I suggested a way of distinguishing between actual under-enrolment and CSPs delivered that just reflect historical allocations.

For example, the core student load could be the previous year’s CSPs delivered plus a proportion of the additional growth allocation. I suggested 85%, although the highly varying rates of attrition between providers complicate ensuring enough CSPs for continuing students.

Lifting the over-enrolment cap would also give universities more flexibility to avoid cutting commencing students due to a historical CSP number that does not reflect current enrolments.

The total allocation pool

ATEC can only allocate CSPs within a ‘total allocation pool’ set by the minister.

Although with these new amendments ATEC must allocate each public university a minimum core student load, the minister has no corresponding requirement to set a total allocation pool large enough for ATEC to meet its statutory obligations.

The bill’s explanatory memorandum claims that bill section 30-5(4) achieves this result but it does not. Its practical effect is to say that ATEC cannot allocate more than the total allocation pool. It therefore compounds rather than resolves the problem.

Ministerial conditions

Perhaps the most common theme in university submissions to the Senate inquiry was concern about the minister’s overly broad section 36-65 power to add university-specific conditions to receipt of Commonwealth Grant Scheme funding, which I described in this post.

Some criticisms of this provision focused on potential misuses of the power. The minister himself was by this month thinking ahead to what a One Nation education minister might do with it.

The government’s amendments restore two exceptions attached to the current power to add conditions to funding agreements.

One of these is that the minister cannot add industrial relations conditions (the NTEU submission provides the history of this section).

The other is that the minister cannot withdraw CSP support for a course using this power to add conditions. He must do so via another provision that requires a legislative instrument, which can be disallowed by either house of parliament. So if a One Nation education minister wants to cancel ‘woke courses’ or ‘Mickey Mouse degrees’ the Senate could prevent it.

The government amendment also inserted a provision requiring conditions to be published on the Department’s website.

Deeper structural problems

The government’s amendments are an improvement but broader problems remain, caused by the new structure of the funding system.

Under the current funding system, the minister is responsible for all CSP allocations. The power to add conditions to CSP allocations through the funding agreements flows logically from this.

But under the new system the minister is only directly responsible for allocating medical places. The minister may allocate demand driven places if they are capped. ATEC does the rest.

It seems strange that ATEC has no direct power to add conditions to the allocations it makes. Its powers are too broad in the topics it can cover but also in some respects too weak to do all it needs to do.

A reasonable example of an ATEC condition would be that places are delivered at a specified campus.

The new section 36-65 conditions power only covers conditions that apply to a specific provider, replacing a provision that permitted both general and specific conditions.

Examples of general provisions are the protocols on course closures and the limits on early offers to school leavers. Such cut-and-paste general conditions are more like substantive rules than conditions on specific grants.

Solutions

In my Senate inquiry submission I suggested solutions to these problems.

For specific provider conditions, I proposed embedding a power to add conditions in each CSP allocation clause: general, medical, demand driven. This would give power to the relevant decision-maker and, by normal principles of statutory interpretation, limit how the power was used. If the minister adds conditions to a grant of medical CSPs these will have to relate to these courses, such as recent funding agreement conditions on locations and medical specialities. He could not use the power to require universities to do things that have nothing to do with medical education.

General conditions should go in the Commonwealth Grant Scheme Guidelines. These typically concern substantive policy issues – early offers, course closures – that are not just technical details on how a particular university will use its funding. As a disallowable legislative instrument the CGS Guidelines are open to parliamentary disallowance, giving them greater scrutiny.

In my repeated calls for the government to both create and follow proper legal processes I am not just hoping to avoid clear abuses of power. The parliamentary process is also a valuable mechanism for improving on reasonable policy ideas and correcting errors, such as those that the government conceded in its own amendments to the capping places bill.