How attractive will the FEE-FREE Uni Ready places be to universities?

Andrew Norton6 Comments

Last week the government introduced legislation that would, among other things, create a new funding category for what we now call enabling courses, which will be redesigned and rebadged as FEE-FREE Uni Ready places. These courses help prepare students for higher education study.

The current system

Under the current system, Commonwealth supported enabling places are funded at the Commonwealth contribution rate for the relevant discipline.

Enabling places are not capped but the financial incentives to enrol enabling CSP students are weak because no student contribution can be charged.

An enabling loading is paid in lieu for universities with an allocation of enabling funding, but many universities have no enabling loading or a low amount.

The government does not seem to update the enabling loading in a public place, but indexing a previous rate I think it is $3,886 per EFTSL in 2024.

Job-ready Graduates affected the financing of enabling places in fields with Commonwealth contribution cuts. Nearly 40% of enabling places are in the lowest Commonwealth contribution field, $1,236 for 2024. That plus the enabling loading = $5,122 per place.

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Will the ‘Costello baby boom’ have a weaker demographic effect on higher education than expected?

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Since the late 2010s I have promoted the idea that the so-called ‘Costello baby boom’ cohorts will arrive at university age from the mid-2020s, increasing school leaver demand for higher education. As the chart below shows, annual births go from around 250,000 in the early 2000s to around 300,000 later in the decade.

Demographers are sceptical of how much effect mid-2000s pro-family policies had, but former Treasurer Peter Costello’s line that ‘if you can have children it’s a good thing to do – you should have one for the father, one for the mother and one for the country..’ was sufficiently memorable that this baby boom has his name attached to it.

As these cohorts approach university age this post takes another look at the data.

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Counting international students – the method is critical to what effects caps have

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The debate on international student caps is mostly at the level of principle. But the capping bill‘s wording is also critical to its effects. A key issue is whether the cap is based on a cumulative total of enrolled international students through a year or the total on specific dates during the year. A cumulative count will have much more serious effects on students and education providers.

The cumulative count wording of the bill

The most natural meaning of the current bill is that the count is cumulative – ‘a limit’ (singular) on the ‘total’ number of overseas students enrolled in one or more years. This means that the cap is driven by the peak number during the year.

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Can migration policy alone manage international student numbers?

Andrew Norton1 Comment

My paper on international student policy – new migration controls and proposed enrolment caps – is published by the ANU Migration Hub today. Some key points appear in The Conversation.

Compared to what I have already written on caps – how actual enrolments will fall below the caps and why even the government’s own agencies doubt the policy’s feasibility and fear its consequences – this paper explores the cumulative consequences to date of migration policy changes.

These consequences are already significant for vocational education and some higher education providers. This raises the question of how necessary the caps are to achieve the government’s policy goal of bringing down net overseas migration.

The policy timeline

Since October 2023 we have witnessed one of the great policy backflips of Australian political history. The Albanese government has turned from supporting the revival of international education – granting a record number of student visas in 2022-2023, extending the temporary graduate visa – to pulling almost every policy lever short of shutting the industry down to reduce international student numbers. International education now keeps political company with live sheep exports, fossil fuels, and vapes retailing.

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Job-ready Graduates price effects?: An update with 2022 enrolment data

Andrew Norton2 Comments

The official release yesterday of the CPI-indexed Job-ready Graduates student contributions for 2025 has prompted questions about what impact the JRG price increases have had on enrolments.

With arts, business and law student contributions to hit nearly $17,000 a year in 2025 – with our bout of inflation having increased them from $14,500 in 2021 – students would be wise to think about whether this is a sensible investment. That’s $50,000 for a basic 3 year degree or $85,000 for common combinations like arts/law or business/law.

On the other hand, as I have argued, students follow their interests while keeping an eye on which courses within their cluster of interests would have the best employment and salary outcomes.

The most sophisticated work to date, using NSW data to 2021, found small effects in the expected directions.

Using simple trends in subjects taken, this post will look at domestic commencing EFTSL by discipline in the 2010-2022 period, drawing on the annual commencing load spreadsheet produced by the Department of Education. This does not distinguish between CSP and domestic full-fee students, but it is the best I can do with publicly available data.

Because I am comparing fields with very different absolute enrolments, I have converted them to an index, with 2010=1. So an index of 1.1 in a subsequent year would mean 10% more EFTSL, and an index of .9 would mean 10% fewer EFTSL.

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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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The government’s own agencies doubt that international student caps are feasible & fear the consequences

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Submissions to the Senate inquiry into the government’s international student caps bill are now appearing online. The House of Representatives has also started debating the bill.

My submission

The online scanned pdf version of my submission is not a sharp copy, the Word version is here.

It expands on the arguments I made in my series of blog posts on the caps, starting with this one in May.

Government agency submissions – implementation and enforcement

Submissions from government agencies raise questions about what internal processes – or rather lack of internal processes – led to the bill being presented in its current form.

The Department of Home Affairs submission leaves its key point to the last two sentences:

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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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Accord implementation proposals, part #3: Distributing student places between qualifications & disciplines & the funding floor

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Part 1 of this series on the government’s Accord implementation plans looked at the proposed Australian Tertiary Education Commission. Part 2 examined how student places would be allocated between universities. This post considers Accord implementation plans for distributing students places within universities between qualification levels and disciplines. In this post, at least, I find that some of the government’s proposals have merit.

Some background: The government has often allocated higher education resources differently depending on qualification level, course, field of education and sometimes students. This practice can target and/or limit spending on a policy goal. The trade-off is less flexibility in moving resources where they are needed. As a result, prospective students miss out or pay much more than the student contribution rate in the full-fee market.

In the 2010s sub-bachelor, bachelor and postgraduate CSPs were funded separately. Since 2021 they have been funded together, with exceptions for Indigenous bachelor degree students and medical courses.

The distribution of student places between qualification levels – postgraduate

While the Accord final report supported more Commonwealth supported places at the postgraduate level, it wanted to focus them on areas of “national priorities and skills needs”.

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Accord implementation proposals, part #2: The distribution of student places to universities and the folly of hard caps

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An earlier post looked at the government’s plans for the Australian Tertiary Education Commission. This post examines the government’s proposals for setting the number of student places and distributing them between universities. This includes a hard institution-level cap on student places, so that universities would get zero funding for enrolments above their allocated level. This post explains why a hard cap is unnecessary and counter-productive.

Overall number of CSPs

The government will determine the total number of CSPs. For ‘fully funded’ places – places for which universities are paid both a Commonwealth and student contribution – this is similar to the current system of the government deciding on total CGS funding, other than the small demand driven system for Indigenous bachelor-degree students (which will be retained). However,

  • because universities will have flexibility in moving EFTSL between disciplines (discussed in a later post) the maximum dollar amount the government pays will be less predictable than now.
  • because of the first point and hard caps on student places at each university (discussed below) the maximum number of CSPs the system provides will be more predictable than now.

It is not clear whether ATEC will advise the government on the number of CSPs, as opposed to contextual factors such as demographics, demand, and skills needs.

And if ATEC does provide advice on system-level numbers, it is not clear whether this will be published or not. The consultation paper mentions the state of the sector report recommended by the Universities Accord final report, but this is framed as a ‘report on higher education outcomes’, not future higher education needs.

Former higher education commissions provided detailed public advice on likely student demand and the sector’s capacity to meet it. For an education minister there is a trade-off. Public and quality advice gives leverage in Cabinet when arguing for money and a semi-independent justification for the government’s overall policy direction. But if the minister does not get the money the sector, and opposition MPs, will use ATEC reports against the government.

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