25 July 2016 Professor Margaret HardingActing Vice-Chancellor

T: +61 2 6125 8487E: dvc.research@anu.edu.au

The Australian National UniversityChancelry10 East RoadActon ACT 2601 Australiawww.anu.edu.auCRICOS Provider No. 00120C

Higher Education Reform FeedbackHigher Education GroupGPO Box 9880 CANBERRA ACT 2601

Dear Higher Education Group

The Australian National University (ANU) welcomes the opportunity to provide feedback to the Higher Education Group on the Driving Innovation, Fairness and Excellence in Australian Higher Education options paper.

We affirm the five priorities to reform as identified in the Group of Eight submission to the panel, these being:

a. Addressing the current distorted funding model by increasing investment in research;b. Moderating the demand driven system;c. Targeted and effective support for low SES and Indigenous students to attend university;d. Addressing the current lack of transparency regarding the resourcing of teaching in our universities

and other higher education providers; ande. Establishing an independent expert advisory body on higher education for government.

We strongly support the principle that the higher education system should be accessible to all students with potential, particularly those from groups that are traditionally under-represented. This principle, however, should not come at the expense of excellence or quality in the provision of university education, including admissions thresholds or employment outcomes.

In response to particular questions posed in the options paper, ANU provides the following response.

Opportunity and Choice1. Subsidies should not be provided to all undergraduate courses at all registered higher education

providers. This would be too difficult to monitor, be subject to abuse, with limited return on investment.

2. However, there would be scope to provide subsidies for providers offering sub-bachelor courses meeting agreed equity and completion rate requirements. This would ensure students from non-traditional backgrounds have access to institutions with the best retention and employability rates and where they have the best chance of success in transitioning to a bachelor degree, which brings stronger likelihood of HECS repayment (http://www.mitchellinstitute.org.au/reports/feasibility-and-design-of-a-tertiary-education-entitlement-in-australia/).

3. ANU strongly supports the transparent reallocation of subsidised postgraduate places. These require review and redistribution with an agreed focus on equity, societal and/or academic need, including the allocation of additional places in STEM fields that are consistent with the National Innovation and Science Agenda.

4. ANU endorses postgraduate Commonwealth support being targeted to courses that deliver significant community benefit and assume this would require national priority banding at the postgraduate level.

5. ANU does not support a time-limited learning entitlement for Commonwealth subsidies as there is minimal return on investment for the amount of bureaucratic administration required. However, ANU may support an indexed dollar limit as described under Affordability 7.

6. ANU would consider demand driven funding for some postgraduate coursework courses, but only for those courses with above average completion rates.

Fairness and Equity1. ANU does not support a reduction in HEPP, but does support review of the HEPP within the

following context: Programs have to be provided secure long term funding.  Improvements to participation

rates can require generational change and therefore funding surety. The evaluation needs to be on the long-term efficacy of programs, especially for programs

that are at the primary school level. There needs to be much more sharing of sector wide data to demonstrate success (e.g. a

program may not have had direct success with a student coming to ANU, but the student may have attended another university because of an ANU HEPP outreach program).

The program funding model is flawed in that it rewards numbers coming to a university, however, the program itself doesn’t allow specific recruitment to your university.

The postcode calculation is a flawed mechanism – Universities are still missing out on connecting with students in need, or not being appropriately acknowledged when they do.

HEPP funding should support, but not be limited to, the following initiatives; University campus visits, mentoring, demystifying university culture, developing academic skills, well-designed online learning and resources, improving the understanding of parents and others that influence a potential student’s decision making, and collaborations between institutions and communities.

2. ANU do not support introducing a new infrastructure fund or loan facility for regional and outer metropolitan universities. These universities have lower research support costs, so it must be presumed that they have more funds available from student income than research-intensive universities.

3. Caution needs to be taken with transformative infrastructure prioritisation. Taken in isolation this could have adverse effects such as on oversupply of graduates in particular disciplines.

4. Yes, the Government could assess alternative opportunities for collaboration or use of new technologies but this should be open to the whole sector as a productivity mechanism rather than only focusing on regional or outer metropolitan universities.

Excellence and Quality1. The flagship courses model is not a concept supported by ANU. This should not be seen as a

substitute for the adequate funding of teaching or research. This mechanism has the potential to provide distorted outcomes such as lack of diversity in course offerings and influencing provider behavior which maximises financial rather than educational returns. ANU would prefer that the underfunding of teaching and research be addressed directly, rather than through one course mechanism.

2. Regulation of the flagship courses would be complex, especially in relation to fee setting. 3. If flagship courses were in place, the Tertiary Education Quality and Standards Agency (TEQSA)

would be best placed to provide an independent review of the proposed fee increases, but would increase the administrative burden on both TEQSA and providers considerably.

4. To reduce the Government subsidy as fees increase above the maximum student fee is essentially the introduction of a levy. The case for institutional autonomy are clear, but levers and constraints are required on price discretion. The critical component of this proposal is the parameters of such a levy. As outlined in Professor Bruce Chapman’s submission to the Senate Enquiry on Higher Education Reform in February 2015, the most important of these are:

a. The decision concerning the course unit chosen (such as course cluster) for which given price and subsidy parameters apply;

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b. The level of price charged for a given course under which there is no public sector subsidy loss for the institution;

c. The rate at which the subsidy loss is set; andd. The rate of progressivity of the subsidy removal with respect to price level increases.

5. ANU recommends that a user review of QILT be undertaken before any additional funds are distributed to these surveys or the website. This would ensure any further funding is focused upon user requirements and also to better determine the return on investment of this service.

Affordability1. ANU does not support further budget cuts to higher education, but acknowledge if these cuts

occurred, that an increase in the student contribution may be required.2. Funding clusters and the cross-subsidisation of research require review to alleviate the systemic

underlying issues for higher education under funding.3. For HELP loan fees, a modest loan fee would be acceptable to ANU.4. ANU is ecumenical on a change to the repayment threshold.5. ANU does not support a change to indexation of HELP repayment thresholds from average weekly

earnings to CPI as this will be discriminatory against women.6. ANU does not believe there is a meaningful return on investment for the burden to administer a

renewable lifetime limit on HELP loans.7. ANU supports restrictions on the availability of HELP loans or Commonwealth subsidies to those

who have left the workforce permanently. This could be for example a $200,000 lifetime limit (as opposed to a time or EFTSL limit) which students could pay off if they wanted access to further funds. This should be administered through the tax office and would have to be in dollar terms rather than as student learning entitlement (SLE) model.

8. ANU supports the discontinuation of the HECS-HELP benefit.9. The administration overhead is too large to introduce a household income test for HELP

repayments and could also be discriminatory.10. ANU supports recovery of debts from deceased estates, up to a reasonably calculated cap, to

maximise the chances of debt being recovered.

ANU is willing to participate in any further discussion on these reforms or implementation proposals once the report is finalised.

Yours sincerely

Professor Margaret HardingActing Vice-Chancellor

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