VC's Update – Higher Education funding announcement

Dear everyone

I thought I would give you my immediate take on the Education Minister's speech that I attended at the National Press Club this afternoon.  There are still a number of uncertainties we need to work through, but for ANU and our future students, the announcement has some positive as well as negative aspects.

On the positive side, the announced measures will enable us to teach more domestic students starting next year, and will include indexing for inflation, which has been turned off for the past few years.  For Australia's future prosperity, it is imperative that every person who wants to get a higher education is able to do so. This is even more true right now, when fewer people will have jobs. It is unclear to me whether the Government's plans will meet domestic demand next year, but we will do our part and work to support those students who are qualified and want to study at ANU, to get a place here.

Other positives include support for our rural and regional students in the form of scholarships that help pay the expenses they incur studying away from home, and not having caps in place on the number of Indigenous students from these areas (although I will be encouraging the government to look at a fully demand-driven system for all Indigenous Australians). More than 15 per cent of our students are from rural and regional areas, and this measure will be a good boost for them. I do recognise most of our other students also have to travel to Canberra to attend ANU, and our philanthropic activities are focused on gaining more support for everyone in need.

But the downsides of the package for our future students are apparent. Most obvious, is the substantive increase in the HECS fees that many of our future students in CASS, CAP, Law, and CBE will have to pay. The Government, to pay for the more generous parts of the program, is shifting cost onto future students in these areas and at the same time has lowered the HECS-debt for students in science, mathematics, and engineering.

Aside from the short-term signalling effect of the Government, it will mean that some future students' HECS bill will be higher or lower than what has been paid in the past. Overall, the portion the government pays of our future students' education funding will drop from 58 per cent to 52 per cent of the bill, with the saving used to pay for, among other things, the extra places. I should note I don't believe current students will see changes to fee structures for programs they are currently enrolled in.

The problem I see for the University (rather than for the individual students) is in the science, math, and engineering areas, because the total amount of money we get per student in these areas drops dramatically, whereas the total funding in CASS, CAP, Law, and CBE will actually increase. As the designer of HECS, Professor Bruce Chapman in our Research School of Economics, always reminds me, changing a student's HECS debt by even a significant amount seems not to change their behaviour. Putting this all together, while our students in CASS, CAP, Law, and CBE will bear a higher HECS burden, those parts of the University will end up generating more money for future activities than they do now. Overall, we believe ANU will receive slightly total more funds for teaching than we have in the past.

While I expect our future students in CASS, CAP, Law, and CBE to be less than impressed with the Government's announcement, I want all of those potential students to remember that degrees in those areas produces an average lifetime additional financial benefit to those graduates in excess of $500,000 - dwarfing the extra HECS contribution. So future students are entitled to be upset, but if you want to do a degree in these subjects, I would still encourage you to do it. You will learn extraordinary things, among extraordinary people, and set yourselves up to make a leading contribution to society. Plus, it will remain a very smart investment of your time and money - especially if you choose to study here at ANU.   

For me, while I am glad to see some of the positive measures, I am disappointed in this critical time of need and opportunity, the Government has not chosen to further invest in higher education. I will continue to pursue support of the University and its activities, and do my best to make sure our students get one of the best educations in the world at a fair price. Some colleagues have noted that in the detail behind the announcement, it may appear to indicate changes to the National Institutes Grant are likely in the next few years. Our funding arrangements are reviewed every three years, and I have been personally assured that there will be no significant changes to ANU funding.

Coming on the back of the many other major financial challenges we are dealing with, and our need to cut back on $75 million of spending this year, I know today's announcements will probably add to a sense of uncertainty. But I do want to use this opportunity to remind you that the ANU community has a vote before it on a potential pay rise deferral. Whichever way you choose to vote, please be sure to have your say. You have until 4pm on Tuesday 23 June to vote, and everyone eligible to vote has received an email.

I am genuinely seeking our community's views on this proposed measure and stand committed to honouring the decision made by our community. One point I do want to note though, is that any deferral of a pay rise will lead to $6.75 million saved for the rest of this year and $13.5 million across a whole year - money I have guaranteed will lead to the equivalent value of jobs saved at ANU.

Any pay rise deferral our colleagues support would be applied across our entire community, in the interests of equity and fairness. We don't make any collective judgements or assumptions about the financial circumstances or challenges faced by staff members and households across our community.

But we are aware of some staff experiencing financial stress. We have established a staff giving and relief fund to assist members of our community who have been directly impacted by COVID-19. As part of this, members of our community can access ex-gratia and tax-free payments of $2,500. This fund has already provided assistance to a number of households in our community.  

Amid all this uncertainty, what I am certain of is that our University will continue to offer a world-leading experience to the thousands of great students who choose ANU every year, and this will be thanks to the commitment and quality of our staff. Thank you all for all that you do.

Finally, you may have seen the news about the cybersecurity attack on Australian institutions today. I encourage every member of ANU to remain highly vigilant to cyber threats and suspicious activity in your emails. Our Chief Information Security Officer has investigated ANU systems, which are now at a sector-leading state of security, and it does not appear that any intrusion has occurred at ANU. We will keep upgrading and improving our digital security as the number and sophistication of the threats increases.

Wishing everyone a good weekend,

Brian