More flexible and diverse universities
Universities have a key role to play in boosting Australia's productive capacity. They need the flexibility to be able to do this well, while ensuring that they remain accountable for quality and responsive to students and employers. Realising Our Potential will promote a diverse and internationally competitive sector, containing both specialised and broader institutions, some focused on particular fields of excellence, others meeting local needs.
Realising Our Potential builds on reforms to encourage greater diversity amongst universities in the Government's Backing Australia's Future package in 2003.
Currently, the Government provides an annual subsidy of between $1,642 and $17,870 (depending on the course) for every student that occupies a Commonwealth supported place at a university. This funding, however, is highly controlled. Under Realising Our Potential these controls will be relaxed, giving universities much greater capacity to respond quickly to student and employer demand. The system will become more demand-driven and responsive, promoting more competition between universities for students and ensuring a higher quality university system.
It will mean that students who want a place will be able to get one, where universities consider that they are capable of completing the course. This reform is achievable and affordable as unmet demand is at historically low levels.
The major change will be to relax the cap on university places at a cost of $211 million over four years by:
- allowing funding to follow actual enrolments within 5 per cent of a university's funding allocation (the current limit on over-enrolments is 1 per cent)
- removing funding reductions for universities that enrol beyond 5 per cent of their allocation
- increasing funding flexibility for certain Masters by Coursework subjects
- removing all caps on the proportion of domestic full fee paying places in courses
- providing funding over three years at a time, rather than the current annual funding system.
Unmet demand for university places is falling (AVCC 2007)
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