Australian universities in the age of Covid

As 2020 dawned, Australia’s universities were anticipating another prosperous year. But within months, as Covid-19 calamitously surged, they were declaring a state of crisis. That the Australian sector feels threatened is nothing new, and over recent decades a steady stream of books and articles have broadcast its precarity.¹ Critiques have typically focused on government funding cuts, the deleterious consequences of market-based reforms and the loss of academic autonomy under an increasingly audit and metric-driven culture. Amidst the Covid pandemic, however, these concerns are being overshadowed by devastating revenue shortfalls, mass staff layoffs and a sense of imminent ‘existential crisis’. Exacerbating this is the Australian government’s explicit exclusion of universities from national emergency assistance packages and its recent announcements about university funding reforms.

Covid is forcing Australia’s universities to reappraise business models and forecasts that reflect the confidence of thirty years of continuous economic growth. With full-fee paying international student enrolments increasing tenfold between 1994 and 2018, to constitute a quarter of all university students, Australian higher education had become, pre-pandemic, a $30 billion industry (Cawood et al., 2018, p. 2; Department of Education & Skills & Employment, 2018). Moreover, reports by consultants and higher education peak bodies have consistently acknowledged universities’ social and cultural contributions as well as their role in preparing young people for participation in twenty-first century knowledge economies (Doidge et al., 2020). Thus, it has been claimed that ‘Australia is a global success story when it comes to education’ (Cawood et al., 2018, p. 1).

Yet despite this, enduring issues surrounding the funding and policy direction of Australian universities have been evident since at least the late 1980s. These have in part been papered over by the huge growth in international student enrolments. This lucrative revenue stream has enabled Australian universities to invest heavily in capital works and fostered a vigorous pursuit of research agendas targeted at improving their position on league table rankings. The dramatic Covid-driven collapse of Australia’s international higher education market calls into question the current model’s viability. It also reignites wider value debates on the purpose of Australia’s universities—their relationship to the public good, and the appropriate balance between government and private funding—the antecedents of which go back to the sector’s colonial origins.

Australia’s early universities, maintained by public money and student fees, deliberately mirrored British traditions. When leading nineteenth century New South Wales politician William Charles Wentworth proposed founding Australia’s first university, in Sydney, in the 1850s, he imagined ‘the opportunity for the child of every class to become great and useful in the destinies of this country’ (Horne & Sherington, 2012, p. 52, our italics). The influence of Wentworth’s ‘useful’ education vision can be seen in the development of Australian higher education. From the beginning, its British-inspired liberal arts model was tempered by pragmatic concerns. Public funding demanded public returns and university programs focused on addressing the Australian colonies’ need for skilled professionals. Student demand for practical professional training reinforced this approach. Together these considerations underpinned the subsequent direction of Australian universities (Davis, 2017, pp. 39–58).

Despite egalitarian pretensions, Australia’s universities were, nonetheless, principally training grounds for the governing elite until well into the twentieth century. Government policy began to reflect a deepening appreciation of universities’ role in Australian social and economic life in the postwar years. Between 1955 and 1965, the conservative Menzies government oversaw a tenfold increase in tertiary education funding and the establishment of new universities, colleges of advanced education and institutes of technology (Reid, 2012, p. 6). And the commitment to wider participation in higher education by the Whitlam Labor government (1972–75) saw student fees abolished. During this period, a bipartisan policy consensus existed in Australia on the idea of the university as a public good. Australia’s universities were used as key instruments in advancing science, technology and vocational training as well as educating a new generation of citizens in civics and the promotion of social justice. The number of people enrolled in university courses increased steadily from the mid-1950s, with a sharp jump in 1975 at the arrival of free education (Australian Government-Productivity Commission, 2019, p. 21). Yet even so, by 1982 the participation rate was just over 10 percent for recent school leavers (Norton, 2014, p. 22). But it was an era in which the importance of higher education, and the possibility of attaining it, took hold in the Australian imagination, and set in motion the transition of the sector to a mass model of education.

Since the late 1980s, however, the ‘massification’ of Australian higher education has been accompanied by a gradual shift in its conceptualisation from being a ‘public’ to ‘private’ good—from civic education to a utilitarian emphasis on equipping students with the skills and flexibility needed by ever-changing labour markets. In part, this has been a consequence of ballooning costs associated with ever increasing student numbers. By 1992, a fifth of recent school leavers were enrolled at university; in 2002 it was a quarter (Norton, 2014, p. 22); by 2009, 32 percent of 25–34 year olds possessed a bachelor degree; and in 2017, nearly 42 percent of 19 year olds were undertaking a higher education course under Australia’s short-lived demand-driven policy (Norton, 2019). Free education ended in 1989 with the Hawke Labor government’s introduction of the Higher Education Contribution Scheme (HECS), by which domestic students were to contribute to their course costs.² HECS, which still operates, is an interest-free state loan in which students’ fee payments are deferred until their income exceeds a minimum threshold; it is then paid automatically through the tax system. Student contributions were initially capped at 20 percent of costs, though it is currently proposed to reach up to 49 percent (on average) (Warburton, 2020). HECS represents an early policy step towards reconciling the private benefit received by university graduates with the wider public good gained by Australia’s society and economy. Bruce Chapman, the system’s architect, has suggested that the continuing public contribution to course costs (initially 80 percent; currently, on average, about 58 percent) recognised the ‘“spill over” to the community at large [that] the state should rightly pay to obtain’. This included the fostering of an innovative economy and the benefits of a ‘more educated community [and] more cultured society’ (Chapman & Pope, 1992, p. 282).

A striking dichotomy has developed in the Australian university system over the last quarter century: a highly regulated domestic sector on the one hand, and a substantially laissez-faire international sector on the other (Davis, 2017, pp. 110–111). While, for example, local students’ course fees are subject to direct government control, universities can charge international students whatever they wish and act comparatively freely in a competitive global marketplace. Australian universities have come to operate in a self-perpetuating cycle. In lieu of government direct funding, international student revenue has increasingly underpinned research budgets and capital works aimed at improving league table rankings; higher rankings attract more international students willing to pay higher fees; increased revenues underpin further research and capital works; and on it goes. In a nutshell, this has been the trigger of the current crisis.

The potential peril of having so many eggs in one basket has been apparent since well before Covid. In 2019, for example, University of Sydney sociologist Salvatore Barbones warned that Australia’s over-reliance on international student revenue, magnified by specific over-reliance on students from one market (China), represented ‘a multi-billion dollar gamble … to pursue a high-risk, high-reward international growth strategy’ (Babones, 2019, p. 1). With the devastating repercussions of Covid now cutting a swathe through universities across Australia, compounded by recent governmental policy decisions, the vulnerabilities of Australia’s higher education system are reverberating across the entire country.

The collapse in international student numbers is forecast to cost the sector up to $4.8 billion in 2020, and $16 billion by the end of 2023 (Jackson, 2020). Insecurely employed academics, who comprise about 40 percent of staff and perform around 70 percent of undergraduate teaching, have already been jettisoned (Connell, 2019, p. 67). It is predicted that up to 21,000 permanent staff members will be retrenched over the next six months (Rapid Research Information Forum, 2020, p. 4). Against this backdrop, Australia’s education minister, Dan Tehan, has announced a funding overhaul designed to ensure that universities ‘teach Australians the skills needed to succeed in the jobs of the future’ (Tehan, 2020). The government’s plan exemplifies the ‘employability skills agenda’ that has been a key feature of tertiary education since the late 1980s reforms of former education minister John Dawkins (Pennington & Stanford, 2019, pp. 44–45).

Australia’s government wants more graduates in areas such as teaching, nursing, agriculture, STEM and IT; and more university-industry partnerships ‘to drive workforce participation and productivity’ (Tehan, 2020). A central pillar of its policy is adjusting domestic student fees so that they function as a ‘price signal’ to encourage students to ‘tailor their studies to areas of future jobs growth’ (Tehan, cited in Bolton, 2020). If legislated, student contributions in the aforementioned areas will decline by 20 to 62 percent. Fees in other disciplines will rise; for the humanities and social sciences (other than English and languages) they will soar by 113 percent. According to Tehan, the government is seeking to break down ‘traditional degree “silos”’ (as cited in Bolton, 2020). This evokes the traditional liberal arts model of education where students take electives in disciplines such as mathematics or science. While advocating cross-disciplinary education is, of course, sensible, and has long been a feature of undergraduate degrees throughout Australian universities, the use of price signals to induce students into areas of projected job growth belies this commitment to broadening the educational experience.

The government has made little effort to justify its proposal to more than double fees for humanities and social sciences subjects. In effect, it has declared that these disciplines have little relevance for the ‘jobs of the future’ (Tehan, 2020); a claim contradicted by established evidence.³ The Australian Academy of the Humanities (AAH) cites government data showing that the top five employment destinations for humanities graduates are sectors ‘projected for substantial growth in the near future’ (AAH, 2020). AAH President, Professor Joy Damousi, has argued that the skills gained from humanities and social sciences training are ‘highly valued by employers and in the workforce’ and that the government’s fees plan will, in fact, ‘adversely impact [its] future jobs agenda’ (as cited in AAH, 2020).

These claims are supported by the business community. For example, in direct response to the education minister, chief executive of the Australian Industry Group, Innes Willox, warned against cutting fees for some disciplines ‘at the expense of increased fees in the humanities [which train] future workers who will fill important professional roles required by industry’ (as cited in Lunn, 2020). Engineering Australia’s chief executive, Bronwyn Evans, has similarly argued that ‘[t]he future of engineering requires a diversity of students who have a breadth of knowledge that extends beyond the technical’; she notes that double degrees, such as engineering-law and engineering-arts ‘are very important for a really well-rounded engineering graduate’ (as cited in Dodd, 2020; Lunn, 2020). Microsoft’s president, Brad Smith, and the company’s head of artificial intelligence, Harry Shum, have stated:

[a]s computers behave more like humans the social sciences and humanities will become even more important. Languages, art, history, economics, ethics, philosophy, psychology and human development courses can teach critical, philosophical and ethics-based skills that will be instrumental in the development and management of AI solutions (as cited in Forde, 2020).

That these latter comments came from within the technology sector is apposite. Few foresaw the consequences of the digital revolution. Indeed, the history of governments ‘picking winners’ is littered with failure. Confronted by the rapidly changing world of work, business leaders have argued that the future workforce will need to be to be flexible, innovative and possess strong critical thinking and interpersonal skills—traits that continue to be identified with humanities and social science graduates. In ignoring these arguments, it seems likely that the humanities and social sciences have been identified as an easy target for a conservative government seeking to reduce its financial commitments to higher education and taking an opportunity for some culture war score-settling. This comes on top of the government’s explicit exclusion of the university sector from other economy-wide Covid-related assistance measures.

The government’s willingness to prosecute these claims is illustrative of an ongoing crisis of confidence and relevance within the humanities and social sciences. As we have previously noted, the humanities and more theoretically focused fields within the social sciences have traditionally been held to be:

integral to our understanding of the human condition, to enrich our personal and collective experience and to develop the moral reasoning and critical thinking skills necessary for democratic citizenship [whereas] [m]ore recently, the defence has increasingly relied on the argument that they foster the soft skills required for successful participation in the 21^st century workforce (Doidge et al., 2020).

These arguments amount to a series of rear-guard defences. During the current Australian debate, there has been noticeably less attention given to the humanities’ capacity to enrich our experience or contribute to the public good, than to their practical value as an incubator of useful work skills and competencies.

The recent funding announcements suggest that even these modest claims have lost support within government circles. Yet, despite the current trajectory, there is some cause for hope. Amidst the ‘job ready’ discourse there has been a minor renaissance of more spirited support for the humanities and social sciences. This has eschewed the rhetoric of utility and argued that current threats like global warming and Covid raise existential questions that the humanities and social sciences are uniquely placed to address. These vast challenges require multi-disciplinary responses; the humanities and social sciences can help to contextualise and communicate scientific and economic developments and their socio-political and cultural implications (AAH, 2020; Edgar & Edgar, 2020; Slattery, 2020; Smith, 2020).

Going forward, Australia’s higher education sector will retain its global focus and commitment to mass education but will be reduced in scale for the foreseeable future. In the absence of alternative revenue sources, its immediate priorities include securing the resumption of international student enrolments and grappling with the planned government funding changes. Competition to attract international students is intensifying—not just between Australia and traditional destination countries but also emerging Asian universities including high-ranking Chinese research institutions. With Australia’s borders still closed due to Covid, international students are now considering Canada, the United Kingdom and parts of Europe as alternate destinations (Ferguson, 2020).

How Australia’s universities and domestic students will respond to new funding arrangements remains uncertain, although it is likely that the government will not see the behavioural shifts it is looking for. This is because its favoured low-fee disciplines, often the most costly to run, will also come with lower per-student subsidies; while in contrast, cheap-to-run high-fee courses in unfavoured disciplines like humanities and social sciences will become comparatively lucrative for universities. The deferred payment structure of the HECS system also raises significant doubts about whether changing fees will have much influence on shaping student preferences.

Pre-pandemic trends towards university-industry collaboration, and fostering greater interconnectedness between Australia’s higher and vocational education systems, will continue and likely accelerate given the government’s reinvigorated jobs-ready focus.⁴ Broad support within both systems for more flexible student pathways, and an increasing focus on offering shorter sub-degree courses including micro-credentials, closely aligns with Tehan’s view that, post-Covid, people will need ‘a mixture of certified skills,’ necessitating ‘once and for all, resetting the relationship between the two streams of education’ (Tehan, 2020). This also raises the potential for greater competition from new for-profit education providers, particularly if prospective students and employers determine that relevant work-related knowledge and skills can be more efficiently and effectively obtained elsewhere (Davis, 2017, pp. 109–110).

Will changes such as these lead to a more utilitarian sector, integrated with the interests of industry? Or might we see a shift from Australia’s highly uniform university model to one offering greater organisational variety? In The Australian Idea of a University, Glyn Davis contemplates a diverse tertiary education sector of ‘new specialist institutions [that] could straddle sectors, offering vocational as well as university qualifications [and] might embrace institutional size, mission, student mix, course offerings, mode and language of instruction, undergraduate and postgraduate offerings, generalist and professional programs’ (Davis, 2017, p. 120). It may be that post-Covid, with the sector under severe financial constraints, and the government moving to explicitly separate funding for teaching and research activities, limited national research resources become even more concentrated in Australia’s research intensive Group of Eight institutions, and mid-tier universities become more teaching-focused. All universities will be reducing scale and refocusing on their respective areas of research strength and/or teaching strength—and perhaps, as Davis envisages, we will begin a transition to greater institutional diversity.

These considerations lead to the question: ‘what do we want our universities to be?’ From their pragmatic origins, Australian universities have come to operate within a diverse range of perspectives on their social role and purpose. The last thirty years though has witnessed a narrowing of these perspectives; there has been a growing emphasis on aligning higher education with industry and national strategic goals, including developing a highly lucrative yet vulnerable service export industry. Covid’s radical disruption of business-as-usual provides a powerful impetus to rethink the sector’s mission. In what will be an extended economic downturn, coupled with pre-pandemic uncertainty about the future world of work and careers, an ongoing ‘job ready’ focus is important to help prepare students young and older for a rapidly changing and increasingly precarious employment market.

More broadly, we must also utilise this critical moment for renewed reflection about the substantive values that underlie the Australian idea of the university. This discussion has been constrained in recent decades by the growing marketisation of higher education. For years now, articulation of Australian universities’ value has been framed overwhelmingly in the discourse of market-based economics—with little weight given to the broader public good that they provide. The language traditionally used to communicate the value of the university has grown cold. It increasingly fails to carry the idea that universities enrich the human experience or even to convey the broader social value of education. Universities are, by definition, cosmopolitan institutions and the disinterested pursuit of knowledge is at the heart of their purpose. The apparent inability of universities to articulate the non-utilitarian value of education has led to a dispirited capitulation to short-term utility. If Australia’s higher education sector does not utilise this period of flux to reinvigorate their wider mission, this crisis will have been a wasted opportunity.

Scott Doidge
Australian Catholic University, Melbourne, Australia
[email protected] John Doyle
La Trobe University, Melbourne, Australia

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Notes on contributors

Scott Doidge

Scott Doidge is a teaching associate at the Australian Catholic University. His research interests are in social theory, cultural sociology, the sociology of education and the history of ideas. His current research focuses on the intersection of the arts and social theory and examines the historical, political and social context of contemporary debates over the value and relevance of the humanities and social sciences.

John Doyle

John Doyle is a honorary research fellow in the School of Humanities and Social Sciences at La Trobe University and an associate of the Contemporary Histories Research Group and Australian Policy and History Network at Deakin University. He also works as a researcher and adviser in the schools sector. His current research focuses on contemporary issues in education policy and practice; the future of education, work and careers; and the politics of Australian telecommunications reform.

Notes

1 See, for example (Coady, 2000; Hill, 2012; Lowe, 1990; Murphy, 2015; Nossal, 1997).

2 HECS was incorporated into the Australian government’s Higher Education Loan Program (HELP) in 2005 and has since been officially known as HECS-HELP.

3 See, for example (AlphaBeta, 2019; Department of Jobs & Small Business, 2019; World Economic Forum, 2016).

4 See, for example (Davis, 2017; Jackson, 2020).