Universities Australia believes that the draw-down of the Education Investment Fund during the Global Financial Crisis was sensible and appropriate policy. However, the goal of an $11 billion Education Investment Fund existing in perpetuity, that was in place prior to the GFC remains a valid aspiration. As government Budget surpluses return, the rebuilding of the EIF must likewise return as a major priority.
In the interim, continuing annual EIF allocations of $500-900 million are very necessary to support innovative major projects, and can be supported by the current uncommitted EIF balance of $2.655 billion.
The EIF is aimed at major competitive projects not general infrastructure. The competitive EIF process should be complemented by allocation modelled on the previous Better Universities Renewal Fund and Teaching and Learning Capital Fund which employed formulae for distribution, preferably provided as an additional annual appropriation.
This formula funding stream would provide the facilities support across universities needed to address maintenance backlog and underpin the expansion needed to meet government participation and performance targets. Internal cost studies at a number of universities have indicated that the current funding of undergraduate places does not cover underlying infrastructure.
Universities Australia proposes that these recommended funding and allocation principles and arrangements be reviewed no later than 2013-14 in the light of Budget circumstances, and in the light of further analysis being undertaken by Universities Australia of ongoing sectoral infrastructure requirements in the longer term.
In sum, the original EIF aspiration is accepted but awaits Budget surpluses, and in the meantime further drawdown of existing EIF is appropriate and should be complemented by formula funding of basic teaching and learning infrastructure.