An efficiency dividend of 2% in 2014 and 1.25% in 2015, which will average $300 million per annum. The 10% discount on fees paid upfront and the 5% bonus for HELP voluntary repayments will both be abolished.
Student start-up scholarships will be converted into loans, repayable in the same way HECS fees are.

The University of Melbourne estimates that the efficiency dividends would slash $52 million from the university budget. Vice-Chancellor Glyn Davis told the ABC “combined with the cuts to—substantial cuts to research at the end of last year —October last year, announced by Treasurer Wayne Swan, that cumulatively the effect on universities is significant.”

The money “saved” from the cuts will now be put into Gonski reforms. “To have the best universities we have to have the best school classrooms, which is why the government is announcing savings measures today to ensure these vital school reforms can be funded,” an accompanying factsheet from the department stated.

The announcement follows a refusal by the government to increase funding on the basis that “Commonwealth funding for university places has increased by 50%” since the Labor government took power in 2007.

In an interview on ABC News Breakfast on April 15, Dr Emerson defended the cuts, “our education system at the schools level needs lots of fundamental repair. It needs repairing, and I think most [university] vice-chancellors would accept that it needs repairing.” He went on to describe the current school system as “broken-down”. The minister was contacted multiple times but could not take the time to speak to Farrago.

The plan completely ignores recommendations laid out in the 2011 Higher Education Base Funding Review, which requested that funding for tertiary institutions be increased in accordance with the uncapped university place system.

The general consensus seems to be that the higher education sector will suffer gravely from this change. The National Union of Students (NUS), Greens Spokesperson for Higher Education, Senator Lee Rhiannon, and the University of Melbourne Student Union President Kara Hadgraft have all argued that university resources, outlined in the Review, necessitate an increase in funding.

NUS’s statement to the government expressed disappointment at their response to the Base Funding Review. “This is something that NUS and universities have been crying out for, for a long time now,” NUS National President Jade Tyrrell said. “So the fact that the government only committed to indexing those funds meant we have a sector that desperately needs more funding.”

Senator Lee Rhiannon described the government’s response to the Base Funding Review as “extraordinary”. She said the government’s discussions about Australia as an “innovative” and “educated” nation imply that tertiary education should be a high priority.

She said that even though Labor has endeavoured to make higher education more accessible for people of disadvantaged or low socio-economic backgrounds, their refusal to increase funds was an “enormous setback, and unfortunately, because little attention is paid to this area outside of the education pages of the media, it’s not getting the attention it warrants.”

She said that Australia’s tertiary education sector has many well-renowned, quality institutions, “but for all those rankings that the universities get, if they don’t have a well-resourced university and most importantly, well-paid staff, with good working conditions, that you can’t maintain those standards.”

Senator Brett Mason, Shadow Minister for Universities and Research, was contacted about the Coalition’s policies for higher education, but could not allocate the time to speak about the issue. Instead, Farrago received a four-month-old media release in which Senator Mason said, “The Government’s response to the Base Funding Review does nothing to alleviate the Coalition’s concerns about quality and standards in our universities.” However, it did not state anything about the Coalition’s own intentions should they take government in this year’s election.

The Greens’ higher education policy supports the 10 per cent increase in university funding. They are also pushing for an increase public investment in universities, to one per cent of GDP (the OECD average). Senator Rhiannon cited a statistic stating that Australia ranks 23rd of 29 OECD countries for public investment in tertiary education. She said the country is “down the bottom of the barrel! I think that would shock many members of the public.” She said she was disappointed that the Labor government does not seem to have the intention of introducing policies to reverse this ranking.

“Whilst the government’s decision to fund the Gonski reforms is a historic one, it is incredibly disappointing that the savings will be coming from higher education and by increasing student debt, by turning start up scholarships into loans,” Hadgraft said in relation to the new announcement. “Improving primary and secondary education must be matched by ensuring students can go onto high quality, accessible tertiary education.”