Sydney

Twist and turn: the University of Sydney must try to squeeze in more students with less funding. Credit: UNIVERSITY OF SYDNEY

A radical plan by Australian education minister David Kemp to regulate the country's universities has blown up in the government's face, leaving the university system in a policy vacuum but turning its future into a highly charged political issue.

After Kemp denied in Parliament that he was contemplating major changes to policy, Labour's spokesman on education, Michael Lee, and opposition leader Kim Beazley dramatically revealed the minister's contradictions in a leaked submission to the Cabinet.

In it, Kemp disclosed: “Universities are currently in a difficult financial position … Already, eight institutions appear to be operating at a deficit and some regional campuses are at risk.”

The paper admitted that higher education “will remain a contentious issue for the government through this term [three years from October 1998]. Higher student–staff ratios, less frequent lecture and tutorial contact, … outdated technology and gaps in the key areas of professional preparation are fuelling a perception of declining quality.”

Kemp attributed this situation to “the highly regulated nature of the existing system”, which he wanted to replace with a “demand-driven system”. His solution was to deregulate student fees and numbers and open universities to “market forces”. He wanted to give students portable vouchers, and loans at market rates, to insist on workplace reforms for staff and to gear courses and research towards commercialization.

Several senior academics had already advocated some of Kemp's proposals. Although these were bitterly opposed by staff and student bodies, all groups condemned the plan's secrecy. Lee estimated that the proposed loans scheme could take a graduate's debt to A$100,000 (US$64,000), and John Niland, president of the Australian Vice-Chancellors' Committee, said there were “a number of things worthy of consideration, but real rates of interest [on loans] is not one of them”.

A public outcry and panic among the government's backbenchers over the threat to smaller universities triggered a hasty reversal of Kemp's plan by prime minister John Howard and his Cabinet. One plank survived, a controversial form of salary bargaining that caused a serious dispute with academic staff.

In a Green Paper on research, Kemp had revealed that he favoured reform based on restructuring rather than restoration of cuts (see Nature 400, 703; 1999). But while collecting reactions to this document, he decided that universities should be financed predominantly by students through portable vouchers, as recommended by a review of higher education by Roderick West (see Nature 392, 854; 1998). Kemp appeared to have shelved its controversial proposals before the October 1998 election.

Some leaders welcome the opportunity to push alternative policies. Gavin Brown, vice-chancellor of the University of Sydney, sees “a bright side”, saying the leak brings “the urgency of the debate on higher education to the broader Australian public for the first time”.

Brown favours deregulation, but believes it has been derailed by Howard's refusal to allow universities to set their own fees. He accuses Kemp of “engaging in an astonishing exercise in systematic alienation”.

Brown says Australian funding is “unstable by any standards”, being a sixth of that per student in the United States. He wants Australia to adopt Ireland's incentive for increasing external income through a government scheme of matching grants.

Alan Gilbert, vice-chancellor of the University of Melbourne, says “everybody is a loser”. Accusing both Howard and Beazley of having “rushed to judgement, ruling out one policy option after another”, Gilbert claims they “may jointly have condemned Australian higher education policy to long-term paralysis”.

Mary O'Kane, vice-chancellor of the University of Adelaide, foresees a “dangerous year ahead”, when the government “doesn't know what it is doing and says it has maintained funding when it has demonstrably cut it”.