However cuts worth a combined $180 million to university programs that support disadvantaged students and teaching excellence are fresh hits.

In a welcome move in tonight’s Budget, the Turnbull Government has delayed the introduction of the proposed 20 per cent cut to 1 January 2018, and dropped the $1.2 billion efficiency dividend on legislated programs.

In scrapping previous plans to fully deregulate student fees, the Government has also released an options paper on alternative policy changes to secure a financially sustainable higher education system.

“Education Minister Simon Birmingham has delivered on his ‘no surprises’ commitment by unveiling an options paper ahead of the election”, said Universities Australia Chief Executive Belinda Robinson.

“The paper provides a basis for discussion on the design of a higher education system that safeguards quality and is both equitable and affordable to students and taxpayers.

“The sector needs this process to resolve the long-running policy tug-of-war, with Budget constraints pulling in one direction and the need for high-quality, affordable university education system pulling in the other.”

Throughout the consultation process, Universities Australia will continue to prosecute the case that a strong university sector underpins the nation’s third largest export sector and is essential to the task of economic transition. It is also the architecture of the new knowledge economy.

The options paper offers a detailed summary of the key issues that need to be debated and we welcome the decision to appoint an expert advisory panel.

The Government’s decision to delay the implementation of its proposed 20 per cent cut will bring some relief and certainty through to 2018.

However, universities are deeply disappointed by Government plans to abolish the Office for Learning and Teaching (OLT) and cut $152 million from the Higher Education Participation and Partnerships (HEPP) Programme, which supports the most educationally disadvantaged students to succeed at university.

“Budget cuts to programs supporting disadvantaged students and encouraging innovative teaching and learning are counterproductive”, Ms Robinson said.

“The HEPP program has seen more students from low-income backgrounds start on the path to university education than ever before. Since 2010, the number of low SES students starting at university grew by a third with the support of this programme.”

The Office for Learning and Teaching was supported by modest funding which has been redirected to TEQSA, the body that oversees quality and standards in the sector, and enhancing the Quality Indicators for Learning and Teaching (QILT) website.

“While universities are pleased to see more resources for TEQSA and QILT, it should not be at the expense of the highly effective OLT. The abolition of the OLT will end a program that underpins teaching excellence and innovation and supports student retention,” Ms Robinson said.

Universities Australia will work with its members to discuss the proposed options and develop a comprehensive response.

AT A GLANCE: KEY 2016 BUDGET MEASURES ON UNIVERSITY FUNDING

• 12 month delay to the introduction of higher education changes to 1 January 2018
• Removal of the efficiency dividend on legislated higher education programs (restoring $1.2 billion)
• Full deregulation of student fees ruled out and a discussion paper released on possible policy options
• A cut to the Higher Education Participation and Partnerships Programme ($152 million)
• Abolition of the Office of Teaching and Learning but retaining the teaching and learning awards ($18 million)