The proposed cuts are not small. And they won’t apply just for one or two years. They would be baked into budgets for years to come. Funding would not keep pace with the cost of salaries, energy, equipment and facilities.
Meanwhile, the fixed costs for universities — including for essentials such as power and gas — keep growing. Between 2016 and 2018, they are projected to rise even more dramatically.
At Monash University, bills for gas and electricity will rise from the $11.5 million last year to $24.5m next year. At University of South Australia, it’s a rise from $5.4m to $8.9m. At Charles Sturt University, in regional NSW, costs would grow from $5m to $7.9m. And at Central Queensland University, the bill would rise from $4.6m to $7.3m.
The government’s higher education legislation would save it $2.8 billion, including cutting $1bn in funding for student places alone. It also has plans to abolish a $3.7bn fund to help build university classrooms, laboratories and libraries. This follows the almost $4bn that universities and their students have already contributed to budget repair since 2011.
These cuts would force universities to reduce services and facilities for students and the wider community. This makes no sense when universities are one of Australia’s biggest economic success stories. International education is our third biggest export. It brought $22bn of income into Australia last year alone.
And while universities here face cuts, other smart nations, such as China and Singapore, are rapidly investing in higher education, research and innovation.
That’s the big picture. Yet it’s also instructive to look at the smaller picture, and the local impact of the budget cuts government has proposed.
Modelling done by the University of Adelaide tells us the higher education legislation would cut $90m from South Australia’s three public universities in the next four years and cost up to 220 jobs. That’s in a state that can ill-afford job losses of any kind.
In the regional economies of far north Queensland, James Cook University has research stations that monitor and protect the health of the Great Barrier Reef and the Daintree Rainforest. Funding cuts would compromise the university’s ability to operate them. That has consequences not only for students and researchers but also for knowledge that sustains a valuable tourism industry.
CQUniversity has 23 campuses and study centres across Australia. Some of these are in very small communities such as Charters Towers, Busselton and Karratha. Often these run at a loss, but CQU uses funds generated elsewhere to support them. The proposed cuts would make it difficult or impossible to continue to do this.
At other regional universities, the story is the same. In northern NSW, the University of New England estimates its funding would be cut by $5.8m next year and the same again in 2019. In southern Queensland, the University of the Sunshine Coast estimates it would lose $7.5m from its funding each year.
The impact is even more stark when you understand that in 2015, eight Australian universities had an operating deficit. A further nine had operating surpluses below 5 per cent, which is not enough to fund future maintenance or withstand further cuts such as those proposed in this budget.
All up, just under half of our universities could be in a precarious financial position if these cuts pass.
Instead of stimulating jobs and growth through our universities, the government instead asks students to pay more to receive less. These cuts would threaten the quality of education and support services. Why would the nation invest less in preparing ourselves for the high-skilled era ahead?
Cuts to university funding and higher student contributions undermine universities. They will not make Australia a smarter, more prosperous nation.
The government asks the Senate to cast its vote in hope that the damage inflicted by these cuts won’t be felt. It will. And it will come at a cost to Australian jobs and growth.
Margaret Gardner is chairwoman of Universities Australia and vice-chancellor of Monash University.
Published in The Australian.