Australian Universities Not Well Endowed

Recently Prof Fed Hilmer, the Chancellor of UNSW, came to visit Canberra to speak at the National Press Gallery. He came not to praise the government but to decry it. Now all government need to be checked, critiqued and criticised for their actions or a lack thereof. But for what the Chancellor is decrying, the general student population should have some reservations.

Hilmer has declared Australian universities are on a precipice; underfunded and smothered by regulation, and heading for decline without urgent and dramatic policy change.

Addressing the National Press Club, Hilmer, representing the ANU through its lobby group, the Group of Eight, said universities should be free to set their own fees for Australian bachelor degrees rather than the current model of fee levels for local students being set by the Commonwealth.

Hilmer in his speech constantly referred to Australian universities as “world class.” This is questionable.  One tutor of mine with a Melbourne PhD described going to a job interview knowing she was against an Oxford D.Phil and coming out second best even though she had a better publishing record in the area. Very few Australian universities are world class, and to claim so is to delude one’s self.

The Times Higher Education Supplement ranks the University of Melbourne at 37th, ANU 38th, Sydney 58th, and Queensland 74th in the top 100; another 3 in the next 100 universities. If the universities were to attempt to emulate the highest ranked universities students might be annoyed by Hilmer’s proposition. Harvard, Oxford, Yale, Princeton and Cambridge, all in the top ten, have the same feature:they charge through the nose for undergraduate education.

Furthermore, Australian universities are not like these institutions because they have money and can provide financial assistance for those most needy. Harvard’s endowment is equivalent to the entire gross domestic product of Uruguay and thus can afford two students per tutor in tutorials, language courses with 12 hours of face to face tuition, and to pay 63 percent of tuition fees through scholarships. Their endowment grew by US$4 billion or the entire GDP of Barbados in the last financial year. The ANU with the largest Australian endowment has less than a thirty-fifth of Harvard’s or $1.2 billion.

In 2010 the ANU made a $137 million profit. So much for crying poor. Australian universities do not have Harvard money but they still have a lot of money that they could be investing in frontline education. However, not all universities in Australia are as lucky as the ANU. At Sydney University it is rare to have tutors with PhDs while at UNSW tutorials tend to start at 20 and can increase to 40 in business courses, not to mention the less well off non-Group of Eight Universities without the large financial endowments.

How would Australian universities attract the sort of money that would be required to produce the same elite standard of undergraduate education at Oxbridge or Ivy League universities? Hilmer suggests allowing universities to charge more for LLB, MBBS, and BComm degrees but no hint to what extent tuition fees would increase.

The UK domestic liberalisation experience revealed a universal increase in annual fees from £3000 ($4488) to £9000 ($13,465), creating a lot of angry students. The idea was better institutions would charge the maximum and less prestigious institutions would charge less, however, this was not the case. Oxford and Strathclyde universities charge similar amounts, yet the quality of education is arguably not.

In the wild freedoms of the US, Yale charges annually US$58,600, which includes US$42,300 tuition for a four year BA, or BSc.; whereas three year postgraduate law degrees are annually US$73,680 with US$51,350 in tuition.

The universities need more money to provide their public service adequately. BA kids are paying $5,648 annually, raise it to what we charge international students, $23568, and nationally see 550,000 domestic undergraduate become a little bit angry. . This would also place education further out of reach of the most vulnerable in society. Students have a right to demand more from their universities. ANU BA international students are paying $23568 annually while at Oxford international students are paying £13200 ($19,750). We do not have the Oxbridge student-tutor ratio yet we find ourselves in tutorials ranging from 15 to 30 students. If domestic students are expected to pay more and at greater expense to that of Oxford, should they get at least an equal level of tuition?

The universities have decided to argue for increasing charges on students when the government potentially could fund the gap, or all of university education as it had between 1974 and 1989.The government has no interest in straddling a BA graduate with Yale-esque $220,000 debts before they have a proper job. Nor is it in the country’s interests to have 100,000 people graduate with that much personal debt every year.

Minister Chris Evans called Hilmer’s claims that universities are poorly funded and could slide into debt as, “alarmist and inaccurate.” “I don’t believe and the Labor Party doesn’t believe that making education prohibitively expensive … is the answer” he said.

Some things are amiss in university funding in Australia. The Minister is ignoring problems and fending off liberalisation, it might be time to start ameliorating these issues in Australian higher education.