Category: Equity and access

Demand driven funding for Indigenous medical students – is it a good idea?

Andrew Norton3 Comments

In line with a 2025-26 Budget commitment, the government has introduced legislation for demand driven funding of Indigenous medical students from 2026.

While well-intentioned, this policy is unlikely to make any significant difference to Indigenous medical student numbers and could accidentally reduce the number of non-Indigenous medical students.

Is there a problem that demand driven funding can solve?

In his second reading speech, the minister noted the current low number of Indigenous doctors and the benefits for Indigenous patients of Indigenous health care workers.

As with the earlier demand driven system for Indigenous bachelor degree students, however, it’s not clear that a shortfall in Indigenous doctor numbers is a problem that demand driven funding will solve.

Universities already try hard to recruit Indigenous medical students, with special entry schemes and quotas in some cases. On the available data (below) they are having some success, a source of pride for the medical deans association. 3% of domestic medical students are Indigenous, compared to 2.3% of the overall domestic student population.

The main obstacle to further enrolment increases is unlikely to be funding rather than the difficulties in finding potential students who meet the entry requirements and are not being set up to fail.

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Update on Accord student funding policies

Andrew Norton7 Comments

With a break between jobs and other things going on I did not comment in December on the Accord-related MYEFO student funding announcements. Compared to last year’s consultation papers, the announcements included a policy change on over-enrolments, more detail on how under-enrolments will be handled, and funding amounts.

Over-enrolments

One of the worst ideas in the June 2024 managed growth consultation paper was a hard cap on Commonwealth supported places. Currently the main CSP category has a soft cap – once a university enrols CSPs valued at its maximum basic grant amount it gets only the student contribution for additional students. These student contribution-only places are known as ‘over-enrolments’. Under a hard capped system over-enrolments would receive zero funding. I explained why hard caps are a bad idea in this post.

In its MYEFO summary the government backed off a little from the hard cap idea. Now universities ‘will continue to receive student contribution amounts for a small proportion of additional students’. The reason given was the practical difficulty of hitting a precise enrolment target. [Update: At a Senate estimates hearing on 27/2/25 the Department said that ‘the overenrolment buffer will be between two per cent and five per cent’.]

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Accord implementation proposals, part #5: Needs-based funding that is not aimed directly at needs

Andrew Norton1 Comment

The Accord implementation consultation paper on need-based funding for equity group members was released late last week, although students with disability will be discussed in a later consultation document. That leaves low SES, Indigenous and students at regional campuses for this paper.

When the Accord interim report came out I rated the principle of needs-based funding as one of its better ideas. But turning it into policy faces significant conceptual, practical and ethical issues. The consultation paper does not resolve these issues.

Funding based on needs versus equity group membership

The basic conceptual problem, in the Accord reports and this consultation paper, is that it remains unclear why needs-based funding should apply only for students designated as equity group members. With the exception of people with disabilities that require adjustments for them to participate in higher education, none of the equity group categories identify personal disadvantage. As the Accord report itself notes, groups other than the equity four are ‘under-represented’ in higher education.

The higher education system should help all its students achieve success, not just those that for historical reasons are included in the equity group list.

Many of the outcome differences we observe are the by-product of mass higher education, which brings a wide range of people into the system. There are more people who were not especially ‘academic’ at school, more people who have trouble financing their education, more people who have major responsibilities other than their studies. In a mass higher education system these students are core business.

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Accord implementation proposals, part #4: Managed demand driven funding for equity students

Andrew Norton3 Comments

When the Accord final report was published one recommendation that confused me was a policy to increase equity student enrolments that was “effectively ‘demand driven for equity’ but with planned allocation of places to universities”.

A demand driven system, under which universities can enrol unlimited numbers of students meeting set criteria, can sit alongside a system of allocated student places or funding. Current Indigenous bachelor degree demand driven funding, which would be retained in the Accord model, sits alongside a soft capped block grant for most other students. But for the same courses, or student categories, demand driven and allocated student place systems are mutually exclusive.

Any hope of clarity has been dashed by the Accord implementation paper on managed growth. It proposes “managed demand driven funding for equity students”.

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What’s new in university and NUHEP funding agreements, part 2: Inappropriate use of the agreements to create a new equity program

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In a previous post on the new funding agreements, I looked at the 2024 Commonwealth Grant Scheme funding for higher education courses and designated courses, along with the amended rules for course closures. In this post I look at a novel funding agreement section, which creates a new equity program financed by under-spends on the Commonwealth Grant Scheme. This program has legal and policy flaws. I also examine some paperwork problems with the agreements for non-university higher education providers and private universities.

What usually happens if universities under-enrol?

Due to weak student demand some, quite possibly many, higher education institutions will under-enrol in 2024 – that is, take Commonwealth-supported students valued at less than the maximum funding they can receive for higher education courses according to the funding agreements – this year a $7.24 billion pot of money.

By law, under-enrolment results in CGS grants being reduced – higher education providers are paid the lesser of the value of student places (on an EFTSL * relevant Commonwealth contribution formula) or their higher education courses maximum basic grant amount: section 33-5(2) of the Higher Education Support Act 2003 for Table A institutions and section 33-5(7), using the terminology of ‘total basic grant amount’ for other higher education providers receiving CGS funding.

Under section 164-10(1A) of HESA 2003 any overpayment is recovered by reducing grants paid to the under-enrolled provider or as a debt to the Commonwealth. Clause 4 of the funding agreements reiterates this requirement.

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Mapping Australian higher education 2023 – official release

Andrew Norton2 Comments

Update 20/12/2025: More recent data here.

Mapping Australian higher education 2023 is now available from the ANU Centre for Social Research and Methods website.

Update 30/10/2024: There is a later version of Mapping 2023’s data here.

Update 26/10/23: A reader has pointed out that list of FEE-HELP NUHEPs is incomplete. A column of names from the original Excel file was omitted during production. The full list is available here. This list also includes three non-FEE-HELP providers registered by TEQSA since the pdf version was finalised. A corrected version of Mapping with the full list of NUHEPs, as of mid-2023, is here.

If anyone has noticed other errors please let me know.

The Accord equity target that cannot, and perhaps should not, be achieved

Andrew Norton2 Comments

The Universities Accord terms of reference asked the review panel to recommend higher education equity and attainment targets, and in their interim report they offer suggestions.

The general goal is equity group parity in higher education participation by 2035 (pp. 18, 20). There is some ambiguity about whether this applies for all equity groups. A few times only three of the main four – low SES, regional, and disability – are specifically mentioned for the 2035 target (pp. 9, 42, 43). For Indigenous students a target is referred to but not specified on p.43. The Indigenous contribution to the 2035 target is however, mentioned at pp. 40-41.*

Other potential equity groups such as first in family, care leavers, people from single parent families and children of asylum seekers may be added (p. 42)

The equity targets interact with an overall target of 55 per cent attainment by 2050. It is unclear whether this target is for people aged 25 to 34 years (pp. 9 & 36), employed persons (p. 33, distinguished from the 25 to 34 cohort), or all people/unspecified base (p. 22).

Whatever the exact 2050 target, it is well above current levels. Equity group parity is not just achieving the overall population participation and attainment rate now. It is chasing a rate that will, if other Accord policies work, be moving up.

This post discusses the practical obstacles to equity group targets that apply regardless of the precise targets set. It also questions whether a large increase in higher education participation would reliably be in the best interests of the additional students.

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Should funding be partly based on student characteristics?

Andrew Norton3 Comments

Australia’s higher education teaching funding system is primarily based on subjects rather than students. Subjects taken are converted into ‘equivalent full-time student load’ (EFTSL), the amount of study a full-time student does in an academic year. The funding rate per EFTSL varies by field of education, assuming that subject characteristics drive costs.

Various supplementary programs calculate funding on headcount equity students, but with trivial resources compared to the subject-driven funding programs, the Commonwealth Grant Scheme and HELP.

Funding on headcount?

One interesting idea in submissions to the Universities Accord review, especially suggested by regional universities, was to base more funding on the student. For part-time study one EFTSL could be two or more individual students. While their combined classroom time matches one full-time student, a student with 50 per cent of an EFTSL could put similar or even greater demands on other university services as a student at 100 per cent of an EFTSL.

In RUN’s submission they report a member university’s finding that, on average, their part-time students utilised eleven services compared to five for full-time students.

Older students are more likely to enrol part-time (chart below). Given the high rates of upper ATAR students going to university soon after school older first-time students must disproportionately be people with weaker school results. They plausibly have above-average needs for academic support to complete their courses successfully.

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Will demand driven funding for all Indigenous students make much of a difference?

Andrew Norton2 Comments

Yesterday the government introduced legislation to extend demand driven funding from regional and remote to all Indigenous students. Currently Indigenous students from major cities are funded from within each university’s capped maximum basic grant amount for higher education courses. If the legislation passes universities will get the full Commonwealth contribution value of all enrolled Indigenous students in demand driven funding eligible courses, with no funding cap.

What are current Indigenous enrolments by geographic category?

Demand driven funding only applies to bachelor degree students – of which more later – which makes it a funding category that is not also a publicly-reported statistics category. However a table in the annual equity statistics lets us calculate the number of undergraduate (ie bachelor + diploma + associate degree) Indigenous students by home geographic location. It shows that Indigenous students from the major cities outnumber regional and remote students. Enrolments from both groups have increased in recent years.

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The Universities Accord universal learning entitlement – how might it work?

Andrew NortonLeave a comment

One Universities Accord interim report suggestion is a ‘universal learning entitlement’. But what would this mean, and how would it differ from what we have now?

The first part of this entitlement is to support Australians in obtaining a tertiary qualification. But it aims to go beyond ‘traditional targets’, such as for higher education or VET, to meet ‘a range of skills and other objectives’.

The interim report defines entitlement funding as ‘an appropriate combination of a public subsidy, a student contribution that would be paid through an income contingent loan … and, for some lifelong learning, an appropriate employer contribution’.

Current limits on higher education enrolments

While no Australian citizen is specifically disqualified from accessing a funded place in higher education, in practice three admissions-related obstacles can stand in their way.

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