‘It is difficult to imagine any other industry tolerating such policy instability,’ Universities Australia chair Barney Glover will tell National Press Club

Australian universities are begging for “policy certainty”, saying no other Australian industry would tolerate the indecision and complete absence of policy suffered by the higher education sector.

Prof Barney Glover, the Universities Australia chair and vice-chancellor of the University of western Sydney, will direct his criticism at both major parties in a speech on Wednesday, although the Coalition government has not announced a policy to replace its controversial and now-shelved higher education reforms whereas the Labor opposition has announced a funding policy ahead of this year’s election.

In late 2015 the Coalition delayed the Abbott government’s proposed massive shake-up of higher education for at least a year after it failed to pass the Senate and encountered fierce opposition from students and parts of the higher education sector. New education minister Simon Birmingham has said he is consulting on a replacement plan, which is now likely to be revealed in the form of an election policy. The government reversed its planned 20% cut to the average federal funding for a bachelor degree for 2016, but its budget estimates continue to assume the cut will occur in future years.

Labor launched its higher education policy in September 2015, soon after Malcolm Turnbull took over as prime minister, promising a $2.5bn net increase to higher education funding over four years, which would more than reverse the Coalition’s proposed cuts.

Labor says its promised increase in federal funding should reduce the costs borne by students compared with estimated costs under the government’s now-stalled scheme. Labor says its plan would reduce the cost of a five-year medicine degree from $125,155 to $52,615 and the cost of a four-year law degree from $86,024 to $42,092.

Glover says the past few years have made it impossible for universities to plan and this is hurting students.

“Almost two years of policy insecurity and uncertainty is taking its toll on the ability of universities to plan and allocate resources in their student’s best interests. It is difficult to imagine any other industry tolerating such policy instability,” he will tell the National Press Club in Canberra on Wednesday.

Dr Stephen Weller, the chief operating officer of the Australian Catholic University, told Guardian Australia the policy uncertainty was hurting students and prospective students, who didn’t know what courses would be offered or how much they would cost. It was also hurting the university workforce because universities were more likely to avoid long-term staffing decisions and offer short-term or casual positions when they weren’t sure what their future funding would be.

“It’s having an impact on universities’ whole planning approach. There is a huge temptation to be less comprehensive in your planning, to take on fewer bold ideas, if you don’t know what the future holds,” Weller said.

Glover will also suggest that more of the $12.9bn Australia spends each year on research and innovation go to directly reward partnerships between business and universities – either through a higher tax concession for those who are collaborating, or through direct grants.

“We believe the introduction of a premium tax concession rate for businesses collaborating with public research institutions could substantially improve its effectiveness in supporting cutting edge innovation. It would also further increase the utilisation of our world-class research infrastructure,” he will say.

“Beyond tax incentives, Australia needs to consider seriously whether we have the balance between direct and indirect support for innovation right. In international terms, we have an unusually high reliance on tax-based support. This is an important part of fostering innovation, but it can’t do everything.

“Direct funding can better target high-growth sectors and policy goals, such as greater collaboration, and can be more effective for small businesses and start-ups.”

The Turnbull government launched a review of the research and development tax concession as part of its innovation package in late 2015.

Labor’s higher education policy abandons the Coalition’s controversial plan to deregulate university fees, allowing them to charge more.

It retains the Gillard government’s 2012 decision to remove previous limits on bachelor degree student numbers, but will ditch plans to extend this demand-driven system to diplomas and associate degrees from non-university providers, like private colleges. And it will impose new restrictions on universities to ensure higher rates of completion.

Both Birmingham and Labor’s higher education spokesman, Senator Kim Carr, will address a higher education conference over the next two days.