Brian Schmidt has never been one to overstate a challenge or overlook a solution others may have missed.
Key points:
- International student fees have helped fund Australian universities' research and growth for years
- But borders are expected to remain closed until 2022, and the budget contains little for the uni sector
- ANU's head says he is surprised by the snub, while other vice-chancellors are negotiating behind the scenes
His scientific curiosity was nurtured by his fisheries biologist mother and his passion saw him excel at the highest levels after graduating from an Alaska high school 35 years ago.
Among his achievements are a doctorate from Harvard University and a Nobel Prize in physics for groundbreaking work upending what we know about the universe.
But following this week's budget — and the perilous state of the university sector in the wake of the COVID crisis — he has been stumped by a government budget snub.
Mr Schmidt, the vice-chancellor of the Australian National University (ANU) in Canberra, says universities have been "left to bleed to death".
"[What is] harder to understand is why the university sector has been left to bleed, given what most might expect to be its pivotal role in the health of the economy," he said.
ABC News: Brendan Esposito, File photo
)All Australian universities have felt the pain from COVID-19 but thanks to wealthy ex-alumni, luck and existing cash reserves, some of ANU's rivals still recorded a surplus.
One large competitor actually workshopped a pandemic scenario in 2019 as part of its contingency planning and swiftly pulled the plan from its bottom drawer when that became reality in 2020.
On the other hand, ANU's decision to cap its total student numbers in 2018 meant it was uniquely exposed.
While it performed well in 2019 financially, it entered the pandemic having missed a year of student growth and recorded a 2020 deficit of $162.4 million, with one in 10 staff departing.
"ANU is the canary in the coal mine," Mr Schmidt said.
"The cumulative effect of border closures on international student numbers will lead to other universities catching up with my university's budget woes this year."
What does the government say about uni funding?
Education Minister Alan Tudge told the ABC that funding for the higher education sector had already reached a record high of $20.4 billion.
It also received a one-off $1 billion in emergency research funding last year.
"There are more Australian students studying at Australia's universities than ever before, thanks to our Job-ready Graduates package — 802,000 this year, compared to 763,000 last year," Mr Tudge said.
"It's important to note Australia's universities remain relatively financially healthy, with many reporting surpluses in 2020."
The federal government did provide $53 million to private international education providers in the budget.
Mr Tudge said these schools needed the money most, with a 17 per cent fall in international students compared to 12 per cent at public universities.
Despite being comparatively less impacted, public universities have still suffered waves of job losses and courses being cut because of their relative dependence on foreign money.
Why are Australian universities so reliant on international students?
Australia has a unique research funding system where universities rely on banking a surplus from student fees to match the research money they get from government.
For every dollar a university gets from a government funding body, it needs roughly another 60 to 70 cents of its own money to pay the staff and keep the lab lights on.
International students provide the bulk of the cash because they pay much higher fees than domestic students.
And for years the gold poured in from overseas.
ABC News: Danielle Bonica, File photo
)As a result, Australian universities soared up the international rankings, paid their vice-chancellors record salaries, casualised much of their workforces, built healthy reserves and embarked on huge capital works.
But COVID-19 stopped the good times instantly, and brutally exposed the system's flaw — a need to continually enrol high fee-paying international students.
At the same time, the money universities got for teaching domestic students changed after last year's university funding reforms.
The Job-ready Graduates legislation used a financial carrot and stick to push students into careers in demand.
But oddly, increased fees for arts degrees and other courses the government wants to discourage mean they are now the most profitable for universities.
Areas like science, where the government has slashed the cost for students to boost graduates, are not as enticing for universities because they bring in less money.
"Quite bizarrely, the current settings mean that this year, the worst-affected degrees are science and engineering," Mr Schmidt said.
"We are simply not going to be able to take enough students [in STEM fields] as we did last year."
Mr Schmidt is one of Australia's most respected university leaders, having won a Nobel Prize in physics in 2011.
He also took a significant pay cut to protest the million-dollar salaries enjoyed by his peers.
Now, that largesse and debate seem a world away from today's fiscally challenged campuses.
Why aren't other universities speaking out?
For now, many chiefs in the sector are taking a much more conciliatory or low-key approach.
Behind the scenes, a group of vice-chancellors is negotiating with Education Minister Alan Tudge.
While universities want to continue the research that has led to global recognition, the government's priority is an improved experience for domestic students.
There is still hope from some university leaders that the talks will satisfy both those aims.
Challenges facing universities likely to continue
As well as walking away empty-handed in Tuesday night's budget, assumptions that borders could remain closed until mid-2022 mean the pain could last much longer than many expected.
The peak lobby group for the sector, Universities Australia (UA), said that posed "a very serious challenge".
UA wants state and federal governments to do more to allow students to arrive earlier from "low-risk countries".
The politics are extremely challenging though, with quarantine spaces tight and many Australian citizens unable to return home.
Officials also need to consider the risk of an outbreak linked to bringing in international students.
We want to hear your questions and comments about the budget and how it impacts you. You can submit your response here.
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2021-05-14 01:06:25Z
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