Australia's entire higher education system could be under threat from cuts to Tertiary Education Quality Standards Agency and the opening up of the sector to more private providers

Universities are warning of a “reputational risk” for Australia’s entire higher education system because the government is cutting funding from the sector’s independent quality control body just as it is being asked to check new private providers seeking accreditation for government subsidies.



The budget cut $20m from the Tertiary Education Quality Standards Agency (Teqsa) – almost half its funding – which the government said was in line with the recommendations of a recent review.



But that review did not take into account the government’s subsequent decision to open the government-subsidised tertiary sector to private operators.



“If there is a significant increase in new entrants under deregulation that will certainly increase Teqsa’s workload, and if they don’t have sufficient resources what will be at risk is the reputation of our higher education system,” said the chief executive of Universities Australia, Belinda Robinson.



“We are broadly supportive of the move to ‘light touch’ regulation but it is absolutely critical to assure domestic and international students of the quality of Australian courses, so Teqsa really needs to have resources to carry out its functions,” she said.



The vice-chancellor of the Queensland University of Technology, Peter Coaldrake, also said the government needed to be “extremely cautious cutting 40% to 50% from Teqsa’s budget” and that it was essential the regulator could continue to do its job.

“We need to make sure we don’t let in fly-by-night operators. We need to be proud of brand Australia,” he said.

The chief executive of the Group of Eight universities, Mike Gallagher, was less worried, saying it was essential to have a “strong regulator” but if Teqsa’s job became unmanageable it could always “make the case for extra funding”.

“It’s hard to know whether there is going to be a stampede,” he said, but since Teqsa was now being asked to take a narrower focus it could cope with an increase in accreditation requests from new providers.

He said legislation before the Senate changed Teqsa’s focus from re-checking the credentials of established “low risk” universities to “focusing on what it was intended to do, that is focus on new providers and potentially unscrupulous activities”.

But the opposition spokesman on higher education, Senator Kim Carr, insisted there was a “grave risk that the government has not thought through the impact of funding cuts at the same time as it embarks on deregulation”.

“We are very worried we will see a return to fly-by-night operators and unscrupulous operators who infiltrated the system in the past and posed a serious risk to Australia’s reputation … this is potentially a recipe for disaster.”

Carr said Labor would be proposing “substantial amendment” to the bill reforming Teqsa that is before the Senate. That bill implements recommendations of a review commissioned by the former Labor government.

According to the budget papers “funding for Teqsa in 2014-15 and forward years has been significantly reduced following the government’s acceptance of the recommendations of the review of higher education regulation … Funding is reduced by $3.338m in 2014-15, $7.596m in 2015-16 and $9.999m in 2016-17”.

The National Tertiary Education Union – which represents the professional and industrial interests of 28,000 staff working in higher education – has expressed deep concerns about the funding cuts and the legislative changes.

"It is an extreme and ideologically driven measure to effectively remove all quality assurance and standards mechanisms, particularly when there is nothing in place to ensure that quality in higher education is maintained, let alone improved," the union said in a submission to an inquiry into the bill before the Senate.

"It would appear that the purpose of these changes is not to better regulate tertiary education, but to open the sector up to unregulated competition."

A spokesman for Teqsa said in a statement: “The government determines the level of resourcing to its agencies and expects them to deliver mandated outcomes. Teqsa is expected to deliver its quality assurance activities of registration and accreditation with reduced funding, by improving the efficiency of these core regulatory activities and reducing its administrative costs.”

The concerns about the regulator’s role and funding are likely to be raised when Teqsa appears before senate estimates Thursday and when the senate inquiry into the government’s legislation has a scheduled hearing on Friday.