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RUBY:

From Schwartz Media, I’m Ruby Jones. This is 7am.

Australia’s universities have been hit hard by the pandemic, with thousands of job losses.

Now, the federal government wants to dramatically change the way the sector is funded, and how much students will pay.

But those changes would also cut back on the ability of universities to undertake research.

Today, Rick Morton on the crisis facing our universities, and why we’re on the brink of destroying our national research capacity.

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Archival Tape -- Unidentified Woman #1:

“Universities are warning they'll be forced to shed tens of thousands of staff after missing out on the federal government's JobKeeper subsidy…”

Archival Tape -- Unidentified Man #1:

“The uni announcing deep job cuts citing growing financial pressure due to Covid 19 and the loss of international students.”

Archival Tape -- Unidentified Man #2:

“That income is gone, it's gone for not just now, not just for the short to medium term future, but possibly forever.”

Archival Tape -- Unidentified Man #3:

“I’ve never seen morale the way that is at the moment and it's at a time when we should be embracing scientific research.”

Archival Tape -- Unidentified Man #4:

“The future of every single member of staff is uncertain.”

Archival Tape -- Unidentified Man #5:

“Some warning more than 30 thousand jobs could go by Christmas..”

Archival Tape -- Unidentified Man #2:

“Resilience is being severely tested in a way that it has never been tested before…”

RUBY:

Rick, it's been a difficult few months for Australia's universities. So tell me, right now where do things stand?

RICK:

As the fallout from the Covid-19 pandemic has become clearer, I guess, universities across the country have begun to shed staff in huge numbers.

At least 11 thousand staff have already been axed, or announced, largely in response to the collapse in international student numbers from the lockdowns around the world.

RUBY:

Rick Morton is a senior reporter with The Saturday Paper.

RICK:

But that's a conservative estimate, so jobs in higher education are increasingly casual or sessional contracts, and the universities have only been reporting cuts to full time staff jobs. And the union, the NTEU estimates job losses could be as high as 20 thousand, or even more. And the government has stood by and basically done nothing.

But now, in among all of this, the government has decided to finally do something about what has been a fairly broken university funding model. And its introduced this new bill, this higher education reform bill to change the way universities are funded.

But the problem is that could actually make the situation even worse.

RUBY:

OK, so let's talk about this bill, which is currently before the parliament. What are the funding changes contained in it that the federal government wants to make?

RICK:

So I think people know the headlines.

Archival Tape -- Unidentified Woman #1:

“The federal government is slashing the cost of some university degrees and adding an extra one hundred thousand places by 2030.”

RICK:

The bill essentially will hike student fees in some courses, such as the arts and humanities, by as much as $14 thousand per student, while also lowering them in others. In the kind of fields of study that the government thinks will lead to actual jobs and jobs that the economy in the nation needs.

Archival Tape -- Unidentified Man #2:

“The cost of a more popular degree will be going up including law and commerce as well as humanities which will more than double in price.”

RICK:

It wants to shift students away from courses in humanities where they don't think they're employable -that’s their thinking, not mine, by the way - and towards degrees in science and engineering and things like that.

Archival Tape -- Unidentified Man #1:

“We want to incentivize students to undertake courses that will give them the skills to take the jobs of the future.”

RICK:

Now, the higher education sector has actually been very specific and has warned the government that the bill will not succeed in this goal. In fact, it may actually have a perverse effect where fewer students are taken into the degrees that the government wants them to go into precisely because of those fee arrangements.

Melbourne University, for example, says that many of the courses where the government wants enrollment growth will actually receive a lower rate of funding under the proposed changes, lower. And extraordinarily, the government's own explanatory memorandum for the bill says that students won't be discouraged from studying degrees with high fees because they can simply push the fees onto HECS or student loans.

There is actually very little evidence around the world that a price signal in a university degree actually affects student choice.

RUBY:

OK. So, Rick, what will the consequences be of this Bill then for both students and also for the universities?

RICK:

The proposed changes will saddle some students with more debt later in life.

But the package will, and this is very important, the package will grow the number of places for domestic students by 100 thousand over the next decade. But that's still within a revenue neutral funding envelope from the government. So there is not a single extra dollar for universities over the next three years.

And if you take all of these proposed changes together, the total cut for universities in funding per student is almost six percent.

RUBY:

Right. OK. So, in effect, the package reduces the amount of money that universities can draw on to operate. And it also increases debt for some students while lowering it for others.

RICK:

That's exactly right.

But the bill also does something else that's attracted far less attention in all of the reporting. And what it does, in effect, is smash this historic link between teaching and research at Australian universities.

There's new analysis that shows that the government's proposed changes will slash about two billion dollars a year from university research budgets if it becomes law,

And that, that will absolutely devastate the sector.

RUBY:

We'll be back in a moment.

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RUBY:

Rick, let's talk about this new analysis into the proposed changes to funding research at universities. What is it telling us?

RICK:

It's essentially saying that under this new scheme, if it becomes law, the accepted practice of universities taking 40 percent of teaching time and letting those academic staff focus on research and their research projects will no longer be viable according to universities.

And that's essentially because the government has decided to only pay universities what it actually costs, according to them, what it actually cost to deliver the instruction in a university course. But not all of the other things. So traditionally universities split up that time 40, 40, 20 for every staff member. So 40 percent teaching time, 40 percent research, 20 percent admin. And essentially this bill will only provide for the teaching time.

So in lowering the rate that is provided to universities per place, the universities now suddenly don't have any wriggle room when it comes to discretionary research spending within their own institutions. And that's worth about two billion dollars a year at the moment.

So this discretionary budget is actually within the university. It's not tied to a particular project, but they can spend it on things that they deem to be innovative discovery or things that might not get the attention of the Australian Research Council. And that's why it's really important.

RUBY:

And so what impact will this two billion dollar shortfall have on Australia's research output, Rick?

RICK:

Well, in its submission to the Education Department about the bill, the University of Melbourne, which is consistently ranked as one of the country's best research institutions, warned that Australia's research funding is already under severe financial pressure. And I'm quoting from them here. This represents a significant risk to Australia's economic recovery following the pandemic. A world class research system is critical to the nation's future prosperity.

And I had a quick chat with Nobel Prize winning scientist Professor Peter Doherty, who told me that the government's proposed changes will only serve to diminish academic institutions.

Archival Tape -- Professor Peter Doherty:

“Really easy to destroy stuff. Canberra's got a lot of experience in that. They've destroyed all sorts of good things over the years.”

RICK:

And he said, if we want people from outside of Australia to look at us as an advanced nation, then we need to fund universities. And this is a quote from him that really stood out to me: “And if we don't, we'll look more like a bunch of hicks who dig stuff out of the ground and do nothing else”.

Archival Tape -- Professor Peter Doherty:

“Science is not local. It operates locally, but it's basically part of an international culture. And our stature in that international culture, which also spills over into how people regard us as a country, it's partly embedded in that, in the performance of our universities, our research sector.”

RICK:

Now, he says that while medical research is pretty strong outside of the academy, almost no other field is. And even medical research, he qualifies, you know, relies on university graduates to perform the work of innovation and advancement and discovery.

Archival Tape -- Professor Peter Doherty:

“So it's the universities that are the anchors of this and provide the talent, the young people and also the interactions because universities cover a very broad spectrum of knowledge.”

RICK:

And one particular example that Professor Doherty used was the example of CSL Ltd, which is the former Commonwealth Serum Laboratories that was established in 1916 during World War One by the Australian government and privatized in the early 1990s.
Now, he said to me that CSL now can make two variants of the Covid-19 vaccine.

Archival Tape -- Professor Peter Doherty:

“Both those vaccines can be made in Australia by CSL and I think they have arrangements from the government that they will make them. Now if we didn't have that, where would our vaccine come from? Who would make it?”

RUBY:

So real world implications, then, of a decision to cut funding like this?

RICK:

Oh, this is not a theoretical game. You know, everything about our advancement as a nation has come off the back of innovation, invention. And, yes, a lot of those come from the CSIRO, for example. But even that has been diminished by funding cuts over the last decade.

And so we've never been more reliant, I guess, on this pool of smart people who go into the academy to learn and to learn under people who've been in a pretty functioning and highly performing system for quite some time now. And if we risk gutting that middle tier, how do those people learn into the future? That's the key question.

RUBY:

Rick, these are still proposed changes. They’re before the parliament. Do you think that they'll pass?

RICK:

At this stage, It looks likely that they will. Labor and the Greens have opposed the bill.

Archival Tape -- Unidentified Man #1:

“This is a dog act from a bunch of selfish politicians who got free university themselves and now want to bury young people under a mountain of debt.”

Archival Tape -- Unidentified Woman #1:

“The dirty secret at the heart of this legislation is a billion dollar funding cut from government to universities.”

RICK:

The coalition, in order to pass it, it's already passed the House, but in order to pass the Senate, they need three of five crossbench senators to back the legislation.

And I think it's pretty fair to say, based on voting history, that One Nation Senators Pauline Hanson, Malcolm Roberts will side with the government.

The new independent senator, Rex Patrick, he used to be central alliance. He's already said that he won't vote for the bill. And the remaining senator, Senator Stirling Griff, is expected to vote no as well. So that just leaves Jacqui Lambie, who, again, is the key vote that the government needs to pass this legislation. And the only university in her home state of Tasmania has already backed the reform. And I've confirmed that they have passed on their very firm view to her that it should pass into law.

RUBY:

Right. So why would the university of Tasmania want to support the bill, given that if it passes, they will lose out on research funding?

RICK:

Well, the University of Tasmania's vice chancellor, Rufus Black, emailed staff on Monday last week to say that under the current funding scheme, we have reached the cap on the number of Commonwealth supported places we can access next year. Now, that's because there has been a cap and an indexation freeze on all university funding for the last three years, essentially.

So that's one of the key motivations. But also University of Tasmania's a regional uni. So he goes on to say into this email to staff; “while this remains the case, we can neither increase the number of Tasmanian students nor the number of domestic students overall. And while the funding we receive per student will decline if the legislation is passed, this is because funding will be more closely aligned with the actual cost of delivery”. And that goes back to that point we were making about research. The government has costed what it would take to fund the teaching, but not the other elements that traditionally have bulked out universities' kind of research capability.

So, you know, there are some universities that do see this as the least worst option facing them in the context of this long term underfunding of the sector. And, you know, speaking to one vice chancellor who told me that the government are not going to change the total amount of funding, there is no more money.

And, you know, this VC said that they can't see that there is any appetite to make amendments to this bill. So it's a standoff. It's a standoff where the universities don't think they can win.

And so after years of skirmishes and these thwarted attempts to overhaul higher education, the coalition has the academy right where it wants it, and that is, ready to bargain for its very existence.

RUBY:

Rick, thank you so much for talking to me about this today.

RICK:

Thanks, Ruby, appreciate it.

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RUBY:

Also in the news today…

The inquiry examining Victoria’s hotel quarantine program has heard that the scheme’s failure was responsible for 768 deaths and more than 18 thousand infections.

In closing submissions delivered yesterday, counsel assisting the inquiry said that the Chief Health Officer should have been put in charge, and infection control should not have been outsourced.

And Dreamworld's parent company Ardent Leisure has been fined $3.6 million by a Queensland court over the deaths of four people at the theme park in October 2016.

A lengthy inquest in 2018 heard evidence of a number of safety issues at the theme park.

I’m Ruby Jones. This is 7am. See ya tomorrow.

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