Australian universities brace for ‘ugly’ 2022 after budget cuts

Australia’s higher education sector is bracing for an “ugly” 2022 after budget cuts to universities and Tafe funding that critics warn will result in job losses, poorer course quality and less research in medicine and technology.

Tuesday’s federal budget reduced funding for universities by nearly 10% over the next three years, while Tafe funding will be slashed by 24%. That’s despite universities stressing before the budget that the bushfire and Covid crises had highlighted the importance of government funding for research.

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An emergency $1bn grant for research, handed to universities last year during the peak of the pandemic, was not renewed in this year’s budget. And the budget’s assumption that international borders will remain closed until mid-2022 means university finances “will get worse” in the meantime, according to Universities Australia.

A higher education expert, Andrew Norton, from the Australian National University, said the entire package meant “2022 will be ugly”.

According to Tuesday’s budget, total government funding for higher education will “decrease by 8.3% in real terms” between this financial year and next year, and “decrease by 9.3% in real terms from 2021-22 to 2024-25”.

Funding will drop by $741m next financial year, from $11.37bn in 2020-21 to $10.63bn in 2021-22, before a further $387m reduction the year after

Australian universities lost and continue to lose billions of dollars in revenue due to border closures, and public universities were excluded from jobkeeper during the pandemic after the government made a series of rule changes to the program.

The vice-chancellor of the Australian National University, Prof Brian Schmidt, said universities had “been left to bleed” in what was one of history’s biggest spending budgets for other parts of society.

“There is nothing of note for our universities, except for $1.1m to support industry PhDs and additional flexibility for student visa holders when it comes to working hours,” he wrote for Guardian Australia. “This is not only a real shame but a missed opportunity; universities are vital to our future prosperity.”

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Meanwhile, total funding for vocational education will drop 10.8% next year, and another 24.2% between 2021-22 and 2024-25.

The federal Greens senator Mehreen Faruqi, a former academic and environmental engineer, said the budget was abandoning Tafe and universities.

“How can we expect to rebuild with this government hellbent on decimating teaching and research?” she told Guardian Australia.

Faruqi also said the government was moving funds away from public Tafe and “piling more money” into for-profit private vocational education.

“The government has just committed another $500 million for the JobTrainer scheme which will mostly go to for-profit training providers,” she said. “This scheme has had a take-up well below the government’s expectations and yet they keep throwing money at it anyway.

Victoria’s minister for higher education, Gayle Tierney, said the budget “deliberately ignores Tafe and public providers”.

“Tafe … should be at the heart of any good government’s agenda,” she said. “A continued lack of investment will mean more staff cuts and potential campus closures.”

Last year more than 17,000 people were estimated to have lost their jobs at Australian universities, roughly 13% of Australia’s pre-Covid university workforce.

Labor’s shadow education minister, Tanya Plibersek, said thousands more jobs would be lost as a result of Tuesday’s budget.

“Universities have been brought to their knees, and instead of using this budget to help them Scott Morrison has stuck the knife in,” she said. “If he really cared about keeping Australian jobs, he would be helping universities, not hurting them.”

The chief executive of Universities Australia, Catriona Jackson, said on Tuesday night that the budget’s assumption that borders would remain closed until mid-2022 posed a “very serious challenge”.

“The sector took a $1.8bn revenue hit last year,” she said. “Universities Australia estimates another $2bn will be lost this year.

“Governments across all jurisdictions need to come together with universities to develop a robust plan for the safe return of international students. The plan would mean the safe quarantine of students from low-risk countries.

“Australia’s university sector cannot sustain these losses without serious damage to national productivity and the country’s knowledge base.”

Tuesday’s budget also announced an additional $30,000 in funding for every PhD student who signs up to a three-month industry internship after they enrol, and $26.1m total for 5,000 extra short course places at non-university higher education providers in semester 2 of this year.

The government has also pledged $17.7m to extend “regulatory fee relief” for a range of quality oversight bodies, and $9.4m for an “innovation fund for private higher education and English Language Intensive Courses for Overseas Students”.