Vision for Australia: 'Hundreds of boutique universities'

Our neighbours across the Tasman could host hundreds of boutique universities and colleges within a decade if the Howard-led government's push to open tertiary education to the private sector is successful.

A government review into the role of universities suggests fast-tracking the approval of private universities.

It suggests creating a new breed of specialist higher education providers that focus on a narrow range of study - for example, business studies only - that might be called 'university colleges' or 'university institutes'.

Current guidelines stop teaching-only colleges from becoming universities because they do not have a research output. By relaxing the rules, the administration could meet increasing demand for places without using public money.

Prominent academic and incoming University of Melbourne vice-chancellor Glyn Davis predicts tertiary education in Australia is "on the threshold of radical change", mooting the possibility of a US-style system with hundreds of private colleges and fewer big research universities.

"A shortfall in public funding, an eager private sector and international competition all challenge a regulatory system designed in an era before the world wide web of trade liberalisation," he said in the inaugural Melbourne Politics lecture this month.

Another report suggests Australian government spending on education will drop significantly in the next 40 years and private spending will increase as the population ages.

The Australian Productivity Commission's draft report into ageing suggests that by 2044, government funding will decline to 34 percent of university expenditure, down from 48 percent in 2001-02.

Every year since the mid-90s, government funding for universities has declined in real terms by between 8.8 percent and 3.4 percent a year. But private expenditure on universities is soaring, reflecting fee increases and a rapid expansion of full-fee-paying domestic and overseas students.

Resources

A story in The Australian on boutique universities.

A story in The Australian on the role of universities report.

A story in The Australian on the Productivity Commission's ageing report.

An interview with Professor Davis.

Professor Davis' speech.

Loan scheme a boon for private colleges

The Australian Financial Review (AFR) reports that private colleges are having success applying for accreditation to the government's new loan scheme for fee-paying students.

Under the scheme students paying full fees have access to an income-contingent loan to a limit of $50,000 - a facility such students previously were denied. Private higher education institutions can only offer the scheme if recognised as a higher education provider by the Australian government.

The AFR reported in late November that 25 colleges had been approved and another 11 were under consideration. Private providers argue that the loan scheme gives students much greater choice in education.