17 January 2018
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An initial shortfall of almost 10,000 student places will not be funded this year due to the Government’s freeze on university funding, modelling by Universities Australia forecasts.
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As the main round of university offers go out to prospective students across the country this week, federal funding cuts will leave a projected 9,500 places unfunded by Government in 2018.
Universities Australia Chief Executive Belinda Robinson said the $2.2 billion cut announced just before Christmas had put Australia’s universities between a rock and a hard place.
“Universities are determined to honour their commitments to prospective students, but our early modelling shows the scale of the funding gap inflicted by the Government’s cuts,” she said.
“The cuts were announced on 18 December and took effect from 1 January. Many universities had already made detailed plans by that time on how many places they would offer in 2018.”
“The impact will vary from university to university. Some will be forced to offer fewer places in some courses to avoid a budget black hole. Others will have to dig into critical maintenance funds or will lose the funding they need to run outreach into regional and remote Australia,” she said.
In December’s Mid-Year Economic and Fiscal Outlook (MYEFO), the Government froze university funding for student places at 2017 levels, leaving any university that was planning to grow or even maintain student numbers with a funding cut.
These latest cuts come on top of nearly $4 billion funding cuts to the sector since 2011.
“The funding freeze is unsustainable. In 2018 and beyond, universities will struggle to cope with commitments already factored into their Budgets. In the end, short-term band aids won’t be able to stem the bleeding,” Ms Robinson said.
“As Government funding recedes, universities will also be under pressure to enrol fewer students in expensive but crucial courses such as nursing, IT, science and engineering.”
“These are areas where there are already skills shortages in the economy—a situation that will only get worse as the university cuts begin to bite.”
Global ratings agency Moody’s also warned last week that the funding freeze would damage the sector, creating greater funding volatility and risk.
Education Minister Simon Birmingham has hit back, suggesting that universities have plenty of scope to deal with the freeze, without cutting places or services to students. He points out, for example, to a Deloitte analysis that found that university spending on administration and marketing has risen to 15% of funding, up from 6% in 2010.
Are universities really saying that they can’t find a meagre 1.5% of effciencies across their their $17 billion budgets? If so, then they should be embarrassed for putting administrative and marketing budgets before their students.
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