Australia's Prime Minister Spars With Universities in Battle Over Spending

May 10, 2013

Since taking office, in 2010, Julia Gillard, Australia's prime minister, has largely been seen as a friend to higher education. But now Australian universities worry that those days may be gone.

In April, Ms. Gillard's government announced plans to cut some $2.8-billion—­or about 7 percent­—from federal spending on higher education, sparking a very public battle over the future of higher education here.

"We feel betrayed and taken for granted," says an open letter to the prime minister from 1,000 professors and associate professors that appeared last week in 18 newspapers nationwide. "Your government's cuts fundamentally jeopardize the future of our sector."

Under the government's plans, universities would lose $900-million in direct financing over the next two years. In addition, so-called start-up scholarships, which provide financial assistance to low-income students, would be converted to loans, and a discount given to students who pay their public tuition fees upfront would be axed. The government has also announced that it intends to limit a tax deduction for education expenses to $2,000.

The proposals have surprised many in Australian higher education.

"We were aware that the budget is under pressure, as many public budgets are all around the world, and that higher education was unlikely to be spared," said Belinda Robinson, chief executive of Universities Australia, which represents many of Australia's 39 universities. "But there was surprise at the magnitude of the cuts … and at the elements of the savings measures announced."

'Inextricably Linked'

What's more, universities have cried foul on the "robbing Peter to pay Paul" nature of the reductions; at least some of the money would be diverted from higher education to help finance the Gillard government's effort to reform elementary and secondary schools.

"We're very concerned that cuts are being made from one part of the education sector to pay for another," said Ms. Robinson. "All components are inextricably linked, and to diminish one part diminishes the whole."

Universities Australia has paid for a series of print and television ads to help generate public support against the proposed cuts. And the National Tertiary Education Union, which represents staff members at universities, as well as the National Union of Students plan to stage protests on major campuses on May 14, the day the government says it will introduce its new budget.

If the cuts are included in the national budget, it is widely assumed that the Parliament of Australia will pass them.

Meanwhile, Ms. Robinson said, each university is grappling with how it would absorb the unexpected shortfalls. "All institutions are having a very close look at all cost centers," she said.

Sally Kift, deputy vice chancellor (academic) at James Cook University, said the cuts were a "body blow" that would affect smaller institutions most.

For her part, Ms. Gillard has avoided using the term "cuts" to describe the changes aimed at universities, referring to them instead as "moderation of growth."

Semantics aside, it's obvious the Australian government itself is constrained. Last week it warned voters to prepare for an austere budget due to a $12-billion slump in revenue.

In tight fiscal times and with a September election looming, Ms. Gillard has made it clear that finding money for an "education revolution" in schools is a higher priority than financing universities.

Correction (5/24/2013, 12:07 p.m.): This article originally said incorrectly that Julia Gillard became prime minister of Australia in 2007. She did not. She became deputy prime minister in 2007 and prime minister in 2010. The article has been updated to reflect this correction.