An ‘exciting advance’ or ‘poor public policy’? Australian universities divided over new $10bn fund

<span>The new $10bn Higher Education Future Fund has been criticised by the University of Sydney.</span><span>Photograph: Carly Earl/The Guardian</span>
The new $10bn Higher Education Future Fund has been criticised by the University of Sydney.Photograph: Carly Earl/The Guardian

Engineering student James Bow is used to commuting. Every day he makes a two-hour return trip, driving from his home in Campbelltown to the University of Wollongong.

“I start at 8am and get back home as late as 8pm,” he said. “I struggle with tiredness and the petrol costs are high. But my motivation to succeed hasn’t changed.”

Bow is one of thousands of students who might benefit from a new $10bn infrastructure fund, proposed in a 400-page review into the university sector released on Sunday.

Related: Cutting debt and paid internships: key reforms in the Australian universities blueprint

The Higher Education Future Fund aims to fund expanded study hubs in regional, rural and remote areas to make higher education more accessible across the country. Urban areas on city fringes will also benefit, with Western Sydney University already launching a study hub under the scheme in Fairfield in partnership with the University of Technology Sydney and the University of NSW.

“Fairfield Connect will increase access for all students, enabling them to study out of the hub as well as on the UNSW campuses. The new facility will further assist UNSW to assure success as well as access for low-SES students, ensuring its success rate remains among the highest in Australia,” UNSW’s vice-chancellor and president, Prof Attila Brungs, said.

The Heff would be jointly resourced by the commonwealth and the “untied” revenue of universities, which includes income streams from international students and investments.

But Australia’s most prestigious universities have criticised the plan, labelling the fund a “wealth tax” since wealthier universities have more capacity to contribute.

Group of Eight chair and vice-chancellor of the University of Sydney, Prof Mark Scott, called it “poor public policy” penalising universities with significant returns from philanthropic donations and international education.

The University of Sydney was one of the only institutions to avoid going into deficit in 2022, reporting a $298m surplus after a record $1bn surplus in 2022.

The vice-chancellor of the University of Melbourne, Prof Duncan Maskell, said any tax would take away money invested in “education and student experience”, while Monash University warned it would “impair the international standing of Australian universities and blunt the economic and social impacts of university education and research”.

Monash’s vice-chancellor, Prof Sharon Pickering, said where government investment in “particular universities or regions is required, it should simply be made”.

Related: Urgent higher education reform is needed to fix a broken system and secure Australia’s future | Mark Scott

Speaking on Insiders on Sunday, the education minister, Jason Clare, said the fund would not draw from philanthropic donations, while acknowledging some donors may want to contribute.

“There are some universities who hate it. There are other universities who love it,” he said.

The fund was first proposed by the National Tertiary Education Union last year to provide protection in times of crisis and improve student access and equity.

On Monday, the chair of Universities Australia and vice-chancellor of the University of South Australia, David Lloyd, defended the proposal, reiterating it wasn’t a tax.

I think every single one of the universities would be welcoming the fund,” he said. “There’ll be great debate about how it should be funded [but] … it’s positioned as a co-contribution fund for the future.”

Universities that do the heavy lifting enrolling disadvantaged students have been broadly supportive of the accord’s aims, particularly equity funding that recognises the additional expense of supporting these students.

Related: Cutting debt and paid internships: key reforms in the Australian universities blueprint

The vice-chancellor of James Cook University, Prof Simon Biggs, said the current funding system, which is based on enrolments, “penalises” regional universities who can’t attract the same number of international students.

“We welcome a reformed system that will be able to differentiate and not just treat all universities and all regions and communities as the same,” he said.

Innovative Research Universities, which represents seven universities including La Trobe and Western Sydney, similarly backs infrastructure funding, while pressing that private university profits be taken into account allocating public funds.

The vice-chancellor of Victoria University, Prof Adam Shoemaker, said needs-based funding is “nation framing and forging”.

“It will open doors to qualifications for generations of new students of all ages,” he said. “It is fundamentally democratic … it is genuinely one of the most exciting policy advances in years.

“It’s early days on the model – I would emphasise we prioritise not envy, but equity”.

Related: Education minister hints at relief on student Hecs debt and university course fee changes

The Smith Family’s head of policy, programs and strategy, Wendy Field, said there’s a “huge amount to like” in the accord, while adding “taxes are there for a purpose”.

“We’re going to have to find funding from somewhere,” she said. “There is a role more advantaged universities might have to play – they have gold plated, wraparound scholarships – but the numbers who make it are very small.

“We need to distribute resources to meet the need.”

The executive director of the Australian Centre for Student Equity and Success, Prof Shamit Saggar, said getting wealthy universities on board with the fund will be a “political handling game” for the education minister.

“[Equity] is a dream, and aspiration of his,” he said. “You can’t magic these programs out of nothing – but it needs to be spent in an elegant way that will benefit the sector as a whole.

“The bigger principle is if you’re a remote kid, end up in a regional centre and do well, you should be linked in to the most prestigious research in the country.”