Sector welcomes education minister’s guarantee of $18bn in funding, but says it’ll be a tough road ahead as international student revenue crashes

This article is more than 5 months old

This article is more than 5 months old

Universities have warned a federal government guarantee of existing funding levels won’t be enough to prevent 21,000 job cuts in the next six months, as crashing international student revenue hits Australia’s third-largest export sector.

On Sunday the education minister, Dan Tehan, announced the federal government will guarantee $18bn of funding to universities this year, even if their domestic enrolments drop, and provide $100m of regulatory fee relief to the tertiary education sector, including private vocational education and training.

Tehan told reporters in Canberra the funding guarantee would “provide ballast” to universities, which would also benefit from an extended eight-year window to repay HELP loans if they suffer an under-enrolment of students.

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Universities have been calling for a more generous support package, as Labor warns some are on the verge of collapse and the federal government excluded the sector from the lower threshold offered to charities to access the $130bn jobkeeper wage subsidy.

The Universities Australia chair, Deborah Terry, welcomed the announcement as a “first step” but warned that even with the guarantee there will be a tough road ahead.

“We estimate 21,000 jobs at Australian universities will go within the next six months,” she said.

“Without guaranteed [commonwealth grant scheme] and HELP funding that figure would have been even higher.



“Individual universities are already cutting costs across the board through very substantial reductions in operational spending, deferral of vital capital works, and reductions in senior staff salaries.”



“However, this will be nowhere near enough to cover what we conservatively estimate as a revenue decline of between $3bn and $4.6bn.”

Greens education spokeswoman, Mehreen Faruqi, said the university sector needed “more than just life support”, accusing the government of failing universities, staff and students “in a time of crisis.”

“Universities have been forced to become food banks by a government that refuses to give desperate international students any form of income support,” she said.

Labor was more muted in its response. The treasury spokesman Jim Chalmers said the opposition will “examine the detail” of the package.

On Wednesday University of Sydney revealed to its staff it was expecting to lose $470m this year.

The Australian National University chancellor, former foreign affairs minister Julie Bishop, told Guardian Australia that despite a 40% decline in its revenues ANU is likely to miss out on the jobkeeper program because its revenues exceed $1bn, at which point the higher 50% threshold applies.

Tehan suggested universities could be beneficiaries of Australians out of work or stuck at home due to Covid-19 restrictions. He announced the government will “slash the prices of degrees and diplomas in short courses, to enable people, rather than bingeing on Netflix, to binge on studying”, including courses such as nurses and allied health.

“So we also want our universities to seize this opportunity … to become world leaders in short courses, world leaders in what is called micro-credentialing.”

Tehan said the support package was aimed at universities which had suffered a drop in domestic students, but there are ongoing discussions between the New South Wales government and universities in that state to provide “some type of financial loan” for those suffering from a drop in international students.

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Tehan thanked universities that had offered hardship payments to international students, including a $25m welfare fund from Deakin University, and said such schemes are on the agenda for the next education council meeting of state and territory ministers.

“We’ve asked officials to go away and look at what type of mechanisms could be put in place to help support international students through the coronavirus.”

Tehan noted the federal government had allowed second, third and fourth-year international students to access their superannuation and changed visa conditions to allow them to work more hours in frontline sectors including aged care and supermarkets.

Terry said universities will continue to seek low-interest loans from banks and state governments, which would “help reduce layoffs”, and maintain online teaching and research, but reiterated calls for more federal support.



“Many of our students are struggling to pay rent and buy food,” she said. “Universities are offering crisis support, but more will be required.



“Our universities and our students will play a vital role in national recovery. With government support, we hope to ride out this crisis and get to work on rebuilding.”