Encouraging University Responsiveness:

Student-focussed Incentives in Australian Higher Education

Paper prepared for the OECD- IMHE Conference on:

Management Responses to Changing Student Expectations

Michael Gallagher
First Assistant Secretary, Higher Education Division
Department of Education, Training and Youth Affairs

Queensland University of Technology, Brisbane
24 September, 2001

Contents

1. Introduction

This paper covers: general meanings of ‘responsiveness’ and public expressions of it in relation to higher education in Australia; meanings of ‘responsiveness to varying student needs and circumstances’; government policy objectives and measures; and the responses of universities to the changing structure of incentives.

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1.1 Meanings of Responsiveness

Responsiveness is a characteristic of biological organisms that demonstrate behavioural change when incited by a stimulus. Adaptation to changes in environmental conditions (‘learning’) is an ecological prerequisite of survival. Responsiveness is the drive to survive. Responsiveness appears to have been predominantly used as a metaphor applied to government expectations of civil institutions in the context of post mid-1970’s ‘oil shock’ discussions within the OECD about the ‘structural adjustment’ of industries to fundamental changes in conditions of trade and investment and the applications of technology. In this sense as applied to universities, responsiveness relates to broad social expectations of ‘adaptability’ to change and ‘contributiveness’ to national needs. More recent, market-related meanings of responsiveness as applied to universities include concepts of ‘competitiveness’, ‘fitness for purpose’ and ‘customer service’.

Responsiveness can be both an organisational capability and an external perception. Expectations and perceptions of institutional responsiveness are context, time and purpose dependent. The relativity of responsiveness to context can be seen in the form that policy debates take in other countries, such as Thai universities moving from central, input-based financing to devolved, block funding or European states discussing the introduction of student fees. Many features of the Australian higher education system (including institutional autonomy in respect of student admissions, staff hiring, and course design and approval, together with government financing through triennial block funding) are regarded by universities in other nations as more conducive to responsiveness than their own arrangements.

Expectations and perceptions of responsiveness are relative to time and context as reflected in the stage of development of national systems. Far-reaching shifts occurred throughout the 1980s and 1990s in Australia as elsewhere regarding public expectations of government and the scale and role of the public sector. New market-related mechanisms for the supply of services to meet public needs were developed including corporatisation and commercialisation of various public sector agencies, and government relations with public providers were extended to include purchasing of services as well as funding and regulating. Universities were judged by the Williams Committee in 1979 to have been reasonably responsive to social needs. In 1988 they were found to be out of touch and in need of fundamental transformation. In 1998, despite the shake-up of the ‘Dawkins’ reforms’ the West Committee saw the need for a radical shift in financing policy. These different views in part reflected assessments of university performance against changing expectations over time.

Timing can be problematic when evaluating responsiveness. On the one hand, ‘immediate responsiveness’ can be an imperative for winning a competitive contract to provide services. In this sense a university, like a consultancy firm, has to be fleet and expedient in organising the best proposal to meet the client’s needs. On the other hand, ‘substantive responsiveness’ may take some years to inculcate in the culture and practice of an institution, such as the clarification of graduate attributes and their embedding throughout the curriculum and in teaching and assessment practices. Different people viewing an institution’s performance at different points over time may form different opinions on its responsiveness. A commencing student in 2002 may simply take as given the on-line capacities that a university has taken several years and many millions to build, and may even express dissatisfaction with system response times or limited mobility. There is an element of ‘continuous improvement’ implicit in the concept of institutional responsiveness.

The relativity of responsiveness to purpose is complex. Whose purposes take precedence among the many contending demands? Ultimately a university will look to its own long-term interests -- its survival in a form that reflects its values. However, it will have to mediate conflicting pressures in so doing, including by being seen to respond reasonably to the requirements and expectations of those on whom its continued existence depends.

The expectations of university clients are reflected in:

• government planning objectives, targets, priorities, funding initiatives and reporting requirements;

• industry requirements regarding graduate supply (both quantitative and qualitative);

• requirements of professional bodies regarding course content and other factors relating to graduates being certified to practise;

• staff needs, both for attraction and retention, in respect of salaries and conditions of service and access to facilities;

• business and government service purchase requirements for teaching, research and consultancy services;

• market opportunities for exploitation of outputs from research and teaching; and

• varying demands of current and prospective students, such as for new course combinations and availability of courses and services in ways and at times convenient to them.

What Maister (1993) calls his "First Law of Service" is also pertinent:

"SATISFACTION equals PERCEPTION minus EXPECTATION"
If the client perceives service at a certain level but expected something more (or different), then he or she will be dissatisfied. (Maister,1993:71).

Referring to professional service firms Maister comments that a professional may do substantively superior work that is not perceived by the client. Or the professional may invest significant time and effort in dealing with unforseen contingencies but, because the client did not expect the contingencies, "he or she is irritated by the extra delay and expense rather than thankful for the abilities of the professional". Hence the need to manage client expectations through regular communication.

Maister also points to cultural challenges in ways that may well be applicable to universities:

The need to be "client centred" is a constant theme of modern management writings, and it is the professional service sector that is in most urgent need of hearing this message. Because of the proclivity of professionals to become more fascinated with the intellectual challenge of their craft than with being responsive to clients, all too often clients are mocked for their lack of professional knowledge, despised because of their demands, and resented because they control the purse strings and hence the autonomy of the professional (Maister, 1993:73).

Responsiveness as an organisational capability has structural, procedural and cultural forms. Structural flexibility can be affected by institutional scale and composition, including physical location and technology of provision, breadth of offerings, staffing organisation and access to skill sets – the more ‘fixed’ or ‘locked-in’ are these factors for institutions the lower their response capability. Procedural efficiency requires anticipation and timeliness in decision making, well-developed stakeholder relations and market knowledge, adequate and reliable delivery systems, sound performance measurement and know how. Cultural readiness involves opportunity-orientation, client-centredness, openness to new views and approaches, preparedness to take calculated risks and willingness to collaborate. Universities have not been normally designed with such characteristics and therefore face the challenge of having to rebuild themselves in various ways.

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1.2 Different expectations of responsiveness in Australian higher education

There have been various expressions of the responsiveness theme in Australian higher education, reflecting different contexts for public expectations. Davies (1989) contends that the impetus to found universities in Australia in the mid nineteenth century was not to satisfy demand but rather to recreate the social order and institutions of Britain, initially with a curriculum based on Greek, Latin, philosophy, mathematics and natural science. Their establishment may today be described as a ‘supply-push’ strategy, for there was a want of students in the first half century of their operations. However, they were responsive to some degree to the colonial realities, turning to professional studies in Law, Medicine and Engineering, to serve labour market needs and grow their fee-paying student numbers. There were furious debates about the fitness of utilitarian studies with the business of universities, as reflected in the 1904 report of the Royal Commission on the University of Melbourne, in terms not dissimilar to those used today:

The recent developments in University life in England, and more particularly in America, are a recognition that the aims of a University are to be attained not by the cultivation of one or two branches of knowledge; and we quite agree with Professor Harrison Moore that there is no necessary divorce between utilitarian and liberal studies, and that the highest utility may be combined with, and is hardly attainable without, a high culture. In a country like this, where there are no leisured classes, and where every one has to make his living, a University can only be truly national by association with the life’s work of the people. It is too commonly supposed the object of a University is to train students to obtain degrees. Although this is doubtless an important function, yet, its chief object is to educate – that is, to fully develop the faculties of the students, and to extend the bounds of knowledge, and the power of applying science to the varied departments of national life and industry.

Industrial and administrative developments through the years of the two world wars gave rise to growing demand for professional and technically skilled graduates. However, Davies notes that on the eve of the second world war "there was a high degree of uniformity among universities in academic matters, such as the level of courses and staff perceptions of the nature of the institution, which went hand in hand with wide variation in the level of government support, student fees and endowment" (DETYA, 1993:6). This is an interesting observation in the light of later assumptions about the relationship between funding incentives, student behaviour and institutional responsiveness.

The post-war reconstruction effort included support for ex-service men and women, including matured aged people, to participate in higher education. Another main development of that period was the establishment, by the Commonwealth, of the ANU as a research institute bringing together scholars from the war effort to work with postgraduate students on "projects of national significance". The established universities moved quickly to introduce doctoral degree programmes as a contribution to nation building as well as to institutional prestige.

The first national review of the condition of universities by the Murray Committee in the mid twentieth century identified three main roles of ‘modern universities’: to meet the demand for more graduates of an increasing variety; to discover new knowledge through research; and to be "the guardians of intellectual standards and of intellectual integrity in the community" (Murray, 1957: 120).

Seeing a pressing need for increased spending on university staff salaries and infrastructure and growth in student numbers, Murray suggested a framework for the formation of a "concerted national policy" through university-initiated dialogue with government, targeted investment on the basis of advice provided through an independent Australian University Grants Committee, and improved planning and administration by the universities themselves. Murray pointed to the self interest of universities in demonstrating their contributiveness to community needs:

The days when universities could live in a world apart, if ever they truly existed, are long since over. No independent nation in the modern age can maintain a civilized way of life unless it is well served by its universities; and no university nowadays can succeed in its double aim of high education and the pursuit of knowledge without the goodwill and support of the Government of the country. Governments are therefore bound to give universities what assistance they need to perform their proper functions; but in turn universities are bound to be vigilant to see that they give the services to the community that are required by the necessities of the age.

…the universities should, in asking for help from the only sources which can sufficiently support them, keep clearly before their minds the considerations in regard to the national interests which are bound to weigh with governments, and with those considerations in mind seek to present a coherent picture to them of what the universities are doing, and seek to do, for the Australian community (p.91).

Murray also identified some concerns about low levels of student achievement, in terms similar to those being expressed today:

The most disturbing aspect of university education in its actual working is the high failure rate. A survey of the records of students enrolled at six universities for the first time in 1951 showed that of every hundred students only sixty-one passed the first year examinations; only thirty-five graduated in the minimum period of time; and only fifty-eight have graduated or are expected to graduate at all. Such a high failure rate is a national extravagance and can ill be afforded. Extensive consideration of the problem clearly indicates that there is no one cause and we have discussed various relevant factors such as the previous preparation of students, the gap between school and university, the pressure of curricula, teaching methods, inadequate staffing and the absence of student guidance (Murray, 1957:121).

Expanding demand for tertiary education from the mid 1950s gave rise to the establishment of new universities. Concerned about the fiscal costs of accommodating this growth in demand in the university sector, the Government commissioned the Martin Committee to find a cheaper but credible alternative. Martin adopted an essentially elitist approach, recommending that teachers colleges and technical colleges be expanded at a level below universities to meet the growth in demand for technical skills, accommodating those with ‘practical minds’ and allowing the universities to concentrate on higher order learning and research:

The objective of the education provided by a technical college is to equip men and women for the practical world of industry and commerce, teaching them the way in which manufacturing and business are carried on and the fundamental rules which govern their successful operation. The university course, on the other hand, tends to emphasize the development of knowledge and the importance of research; in so doing it imparts much information which is valuable to the practical man but which is often incidental to the main objective. Both types of education are required by the community, and in increasing amounts, but it is important that students receive the kind of education best suited to their innate abilities and purposes in life (Martin, 1964. Vol.1. p.165).

The subsequent Colleges of Advanced Education, facing increasing demand from students with rising entry qualifications, drifted inexorably in emulation of the universities. Several of them also developed innovative approaches to course development in collaboration with industry, with greater use of part-time and external mode offerings. The CAEs were also more corporately planned and organised than universities and, hence, were better able to deliver full-service provision to industry.

The Universities Commission over the years encouraged universities to adopt more flexible entry requirements, expansion of opportunities for part-time and external study, new forms of academic organisation, a wider range of courses and greater responsiveness to community needs.

The idea of responsiveness was explicitly addressed by the Universities Commission in its Sixth Report of 1975 in the context of discussing ‘university autonomy’:

Universities will in general better achieve their purposes by self-government than by detailed intervention on the part of the public authorities…society is better served if the universities are allowed a wide freedom to determine the manner in which they should develop their activities and carry out their tasks (Universities Commission, 1975).

Nonetheless, the Commission generally expected universities to respond to its directives and urgings and, for instance, expressed disappointment in its 1976 Report to the "relatively little response by universities" to its proposals to improve the utilisation of university resources, such as through the scheduling of teaching over more hours in the week and the provision of summer courses (Universities Commission, 1976:34).

Reflecting on matters of responsiveness in its 1979 Report on Education, Training and Employment, the Williams Committee of Inquiry asserted:

No Australian university has ever been so handsomely endowed that it has been in a position to do just as it pleases within the law. A university dependent on fees must be responsive to the interests of students and the interests of those prepared to give research contracts, and a university dependent on Government grants must be responsive to the amounts of the grants and to the extent of earmarking (Williams, 1979:152).

The Williams Committee somewhat complacently concluded that despite some ‘possible malfunctions’ all was well and "more could be gained from a period of quiet reform than from sweeping structural changes":

Australian education is not perfect, it can be improved, and there is a need to adapt it to deal with new problems. The Australian community has, however, been well served by its system of education. The TAFE sector has responded quickly and creatively to new demands on it and to opportunities provided by more adequate funds. The universities displayed a capacity to grow and to cope with new types of students that belied their reputation as conservative and inward-looking institutions. The history of the advanced education sector that was developed after the Martin Committee Report in 1964 and 1965 reflects great credit on the colleges, the State authorities and the Commission on Advanced Education (Williams, 1979:30).

The thrust of the Williams’ recommendations was to maintain the binary divide within higher education and expand the CAE and TAFE sectors, with enhanced credit-transfer arrangements across the three sectors to accommodate growth in demand for skilled labour, allowing the universities to concentrate on research and postgraduate studies.

The binary divide itself arguably justified a rather interventionist approach by the so-called ‘buffer bodies’ in maintaining structural distinctions within the national tertiary education system. Karmel (1998) retrospectively with some gloss explains:

Over the past fifty years the Australian higher education system has been subject to a variety of funding mechanisms and systems of government control. Arguably, the period of greatest diversity, and perhaps of greatest institutional autonomy, was when government influence was mediated through buffer bodies and when distinctions among institutions were maintained by coordinating mechanisms administered by these bodies. Direct government involvement over the past decade has seen a marked reduction in systemic diversity, partly because of the reluctance of the Government to make the politically difficult decisions involving drawing the distinctions necessary to maintain systemic diversity (p. 63).

In 1986 the Commonwealth Tertiary Education Commission took stock of developments since the 1974 inter-governmental agreement to transfer responsibility to the Commonwealth for higher education and reported:

…the Australian higher education system is larger, more readily accessible, and in a better position to respond to the range of needs of students and the community generally than it was ten years earlier. (CTEC, 1986:4).

However, the Commission expressed concern that those achievements had been made during a period of declining resource levels and that while "significant economies of scale were realised" there had been "a decline in educational standards". Moreover, the Commission reported, "virtually all the potential for rationalisation of institutions has been realised".

After dismissing CTEC and its controlling influence, the Government issued a 1988 White Paper on higher education reform, suggesting the Commission had buffered the academy from changing community needs and economic realities:

The Government reaffirms its wish to see far-reaching reforms in the organisation and practices of the higher education system that are to the benefit of students and the community generally. Equally, it reaffirms its view that our higher education institutions should not be isolated from the major changes occurring in Australian society and the economy. Rather, they should be one of the prime agents in the process of change, through both their teaching activities and their contribution to research and innovation (Dawkins, 1998:5).

More generally, the 1988 White Paper, which gave rise to closure of the binary divide and the amalgamation of institutions, and the establishment of a combined fees and loans scheme (HECS), articulated a vision of a higher education system "responsive to changing national needs" and characterised by diversity of institutional orientation:

We are, and want to remain, a diverse society whose members respect the individuality of others. Our higher education system needs to reflect this diversity.

• Our institutions have differing strengths and characteristics, and should maintain the positive aspects of these differences.
• Individual students have a wide range of aspirations and needs, for which the system must provide. Institutions should adapt their offerings to the needs of particular students groups.
• There are significant differences in educational requirements across particular States and regions. Institutions should be sensitive to local as well as to broader national needs.
• The level of centralised control over the day-to-day issues in teaching, research and management of institutions and their staff must be minimised. Such centralised control is at odds with the need for creativity, innovation and diversity (Dawkins, 1988:7).

Interestingly, the 1986 CTEC report had canvassed various financing policy options, including full fee deregulation and central allocation of student places to institutions by specified field of study. Both were disregarded in favour of "continuation of the existing block grants system of funding":

Proposals for a higher education system based on full-cost fees are theoretical; no such system has been implemented successfully elsewhere. They would, in fact, lead to less than efficient use of resources, reduced access and loss of the academic independence provided by tenure.

Similarly, the specification of recurrent grants to institutions in the form of per capita ‘allowances’ for a specified number of places in different disciplines would seriously erode the capacity of each institution to manage its own affairs, since the ‘allowances’ would inevitably become the standard for resource allocation within the institution. In the Committee’s view the best resource allocation decisions are made by those closest to the point of application of the resources – not by bureaucrats in Canberra (CTEC, 1986:16).

The post 1988 White Paper arrangements reflected the tensions of an accommodation of university autonomy within a centrally planned ("unified national") system. So, institutions were afforded: "more flexibility to determine the particular courses to be offered and areas of research to be undertaken"; "greater control over their own resources, enhanced revenue-raising options and decreased intervention by governments in internal funding and management decisions"; and "guaranteed triennial funding based on agreed priorities for institutional activity and performance against those priorities, rather than an arbitrary system of institutional classification". The latter point represented a direct repudiation of the role CTEC had envisaged for itself as a ‘boundary-rider’ ensuring that no institution stepped outside its predetermined jurisdiction.

On the accountability side of the balance sheet the universities would submit a profile of enrolments of students by level and field of study according to their strategic objectives, for the Minister’s agreement and funding approval. For that to happen, the universities would need to prepare strategic plans and supporting planning documentation together with specific data sets. Initially, the profile approval processes were strict, governing course length and nomenclature and requiring responsiveness to priorities set by the Government with regard, for instance, to fields of study, equity of student participation, and modes of delivery. There followed various expressions of resistance by some in the higher education sector, such as to ‘instrumentalism’, ‘bureaucratic intrusiveness’, ‘managerialism’ and ‘social levelling’. Such a reaction may well then have been regarded as signalling that reform was biting.

Progressively as the institutions moved to the implementation stage of the reform agenda and some familiarity, perhaps greater trust, developed between departmental officers and university managers, a more flexible set of institutional reporting arrangements emerged – shifting the relationships from process compliance to strategic dialogue. For instance, priority fields of study were disbanded and research plans were no longer required. Project-specific capital works funding was disbanded and a capital roll-in to recurrent operating grants was locked in at the peak of funded growth (enabling all institutions to attend to infrastructure backlog, refurbishment, replacement and maintenance requirements).

Much of the acquiescence of the universities and colleges to the reform agenda had been purchased through the funding of growth in student places, the bulk of which occurred between 1989 and 1993, a greater than anticipated share of which had been taken up by non-school leaver applicants. The latter included those seeking second degrees and those seeking second chances. With lower rates of growth in funded places in the ensuing years and a demographically-driven peak in school-leaver demand, Government policy was directed to establishing priorities for school leaver participation in higher education through a revision to targets and the establishment of an Open Learning option through a combination of traditional distance-education and television broadcasting. Universities were allowed wider scope for absorbing the newly expressed demand for qualifications upgrading through a phased deregulation of volume and price controls over postgraduate enrolments.

In this context the Government initiated measures to improve the quality of higher education, such as through specifically-funded rounds of external assessment of institutions’ quality processes and the establishment of a programme of grants to encourage improvements in, and raise the status of, teaching in universities.

Notwithstanding these particular initiatives and some impressive innovations, the underlying tendency of the national system was towards homogenisation, especially with regard to research aspirations. There was a massive and rapid surge in the provision of research higher degree offerings through the early 1990s, initially triggered by qualifications upgrading of former CAE staff then merged into universities, supported by specific Government-funded programmes for staff development. Once set on a trajectory of higher degree research enrolments most institutions adopted ‘onwards ever upwards’ strategies, some well in advance of their capacity to support competitive research and quality research training environments.

There were other homogenising pressures on the post-Dawkins’ universities from internal, cultural factors and the industrial relations agendas of external bodies. The formation of a Commonwealth view with regard to enterprise-specific industrial bargaining across industry sectors in the mid 1990s had significant implications for universities. When the then Government in 1995 refused to provide full and automatic indexation for the salaries outcomes of university bargaining, a new set of challenges emerged for universities: how could they fund salary rises not supplemented by government grants while government did not permit them to vary either their student numbers or the prices they charged for the bulk of their business? Two main options were available in these circumstances: one was to find internal efficiency improvements; the other was to grow net revenue from external market activities. While there clearly has been scope for gains in the former it has some limits over time, given the quality imperatives of the sector, and there are costs and risks as well as opportunities, as well as possibly some capacity limits on the latter.

The Howard Government in its first Budget of 1996 took a number of fiscal initiatives that were envisaged as inducing greater attention by universities to social and economic realities, closer engagement with the market, improved internal operating efficiencies and greater responsiveness to students. These included reducing the future growth of operating grants in the forward estimates, funding for universities over-enrolling undergraduate students and extending fee paying options to undergraduate as well as overseas and postgraduate domestic students. In this context the Government established a Committee of Review of Higher Education Financing and Policy. That Committee reported in 1998 (West, 1998).

Although neither the Williams nor West reports had any direct impact on higher education policy, the former eschewed radical reform while the latter embraced it.

West argued from a fundamental position that "in essence, we need a policy framework that is driven by the needs and preferences of those who use the services of universities" (West, 1998:15). West’s key proposal was to adopt "student-centred funding":

In our view the most fundamental and important change that the Government could make to higher education is to move to a form of student-centred funding. Students should have a direct relationship with universities and a real say in what universities provide. The best way to achieve this is to ensure that public funding for tuition is driven by students’ choices – at both the undergraduate and postgraduate levels -- not negotiated between universities and the Department of Employment, Education and Youth Affairs, as at present (West, 1998: 15).

The West approach was predicated on the objective of university responsiveness to student needs as the overarching priority:

The Review Committee favours a model in which public funding for tuition would be driven by students’ choices, institutions would be able to set fees for all students (initially subject to an upper limit for students receiving Commonwealth tuition funding), and access to public funding and income-contingent loan arrangements would be provided to all accredited higher education providers.

Student centred funding is the best way of creating a truly responsive relationship between students and institutions. When combined with a lifelong learning entitlement, a student choice based approach to funding would provide universal access to government support across the post-secondary education sector. In particular, this student centred funding would:

• Allow students’ choices to drive the flow of resources between providers and courses, thus giving institutions a real incentive to respond to students’ needs and preferences;
• Eliminate some of the current restrictions on competition and reduce barriers to entry to the market by freeing up access to government funding and income-contingent loan arrangements; and
• Introduce an element of price competition, and significantly deregulate the setting of fee levels, thereby allowing institutions to make meaningful decisions about prices and volumes, and introduce real incentives for institutions to manage their assets effectively and to control costs. (West, 1998:24).

The West approach envisaged a ‘universal tertiary entitlement’ yet its attention concentrated on the university sector alone and gave scant attention to the larger vocational education and training sector whose strategies for reform over the past two decades have been driven by an agenda of increasing responsiveness to industry needs. Even within the university sector, the West Committee’s proposals were unevenly developed as between undergraduate and postgraduate education and research training. Nor was there any broad ‘sign-on’ to such a radical agenda by any of the various tertiary education interest groups. In the event, the Government did not adopt its recommendations.

There is ambivalence in the public discourse regarding the merits of relying entirely on student preferences as the driver of the nation’s investment in higher education or more broadly, tertiary education. However, centralised ‘manpower forecasting and planning’ has effectively been abandoned for all but the health and medical workforce since the early 1990s. Australian universities have wide discretion over the profile of their student enrolments. The Government has set overall targets for the places it funds but the universities can enrol above those numbers and are free to select students and determine enrolments by field of study. The rationale for this policy is that plural, devolved decisions are more likely than a single, central decision to achieve supply-demand balances, universities are well placed to understand and respond to student demand, and labour market requirements will have a direct impact on the structure of the demand.

A decade after the Dawkins’ reforms, the Government issued a policy statement on research and research training, Knowledge and Innovation, 1999. The policy reform was directed to increasing the engagement of universities with community and commercial realities, and overcoming the following deficiencies:

• Government funding incentives do not sufficiently encourage diversity and excellence;
• Research in our universities is too often disconnected from the national innovation system;
• There is too little concentration by institutions on areas of relative strength;
• Research degree graduates are often inadequately prepared for employment; and
• There is unacceptable wastage of private and public resources associated with long completion times and low completion rates for research degree students. (Kemp, 1999:2)

The policy intent reflected a desire to see greater university responsiveness to both the needs of research students and the national need to capture the benefits of research for economic and social development. One of the key principles for public funding adopted by the Government in the context of the Knowledge and Innovation reforms related to "institutional autonomy and responsiveness":

Institutions should be free to determine how they function and contribute to the generation, preservation, transmission and application of knowledge. They should be able to set their own priorities in terms of the research they choose to conduct and how it is conducted, as well as selecting those best suited to undertake research and research training. The research base should be diverse in terms of the fields in which research is undertaken, the settings in which it takes place and the perspectives that inform its conduct. Institutions should be able to increase their responsiveness to global market opportunities (Kemp,1999:6).

While encouraging universities to be innovative and use their discretion in flexible and diverse ways, the Government also strengthened several steering mechanisms, notably:

• a restructured Australian Research Council, with a more strategic charter and responsibility for reporting on the comparative performance of Australian research
• an enhanced set of programmes for funding research, through a doubling of both NH&MRC and, in 2001, ARC peer-reviewed funding, the latter including an expanded programme to encourage collaborative research links with industry, and additional funding for major centres of expertise and national research infrastructure
• introduction of a contestable basis for the allocation of tuition-free research student places through the performance-based funding formula of the Research Training Scheme
• a requirement for universities to provide for publication an auditable annual report of its research and research training management objectives, strategies and performance
• establishment of an independent Australian Universities Quality Agency to conduct periodic quality audits in order to verify universities’ own claims.

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Interpretation of developments

The responsiveness theme has had various manifestations in Australian higher education over the last half century. Purposes and emphases have sharpened over time. The following range of meanings of university responsiveness can be gleaned:

• challenge to academic insularity;
• compliance with central directives;
• connection with and contribution to local, regional and national needs;
• adaptability to change in the operating (competitive) environment;
• sensitivity to varying student needs and circumstances;
• readiness to capture global market opportunities.

Initially the universities, and largely for a century of elite access, developed their own modes of responsiveness to student interests and community needs. National imperatives caused government investment and expansion of the system with closer integration of university purposes with the goals of nation building. Massification of participation widened the student body with regard to the diversity of their social backgrounds, the diversity of their aptitude and educational attainment, and the diversity of their needs, interests and motivations. Continuing student demand hit fiscal capacity limits and led progressively to fewer restrictions on universities determining the volume of their enrolments and their tuition prices, except for the bulk of domestic undergraduate students whose fees are set by the Government. The extension of fee-paying access increased student consumer power at a time when universities were becoming more competitive among themselves, and when the interactions of market globalisation with the accelerating power of information and communications technology was opening new markets, developing new products and enabling the entry of new providers.

During the 1990s we have seen in the massified higher education sector a shift from "responsiveness to national needs" as mediated through central planning, resource allocation and regulation (at a time of high university dependency on the state) to "responsiveness to students" as mediating labour market needs through their preferences and choices (during a transition to increasing university self-reliance). At the same time, in the vocational education and training sector, a commensurate shift from central control to user influence has been differently expressed through "responsiveness to industry needs", mediated through a consensus of employer and labour representatives regarding job-related competencies. More recently the universities too have been encouraged to engage more with industry in the learning opportunities they provide for students and through their research. Now at the intersections of these arrangements, and in a more contestable environment for the provision of services, we are seeing new and more integrated forms of expression of student and industry needs, and more innovative ways and means of provider responsiveness.

Generally the universities have traditionally spurned a narrowing of higher education, and especially a short-term, instrumentalist training agenda, notwithstanding that much of their business has traditionally related to preparation for professional employment in applied fields such as medicine, accountancy and engineering. The growth in recent years of student interest in double degree combinations at the undergraduate level perhaps reflects a student-driven desire to cross occupational boundaries in compensation for the narrowness of professional courses and a reaction to the Australian tendency for early specialisation. The key provider-led change has been the clearer definition of ‘graduate attributes’ in the higher education sector, integrating academic and performative learning objectives and the deliberate efforts by the leading institutions to embed them in curricula, teaching and assessment. Within an increasingly competitive environment those universities that can best accommodate diverse student interests and employment-relevant offerings are most likely to prosper.

Similarly, those institutions likely to benefit from the new structure of incentives for research and research training are those that focus on what they do best and give effective attention to the needs of their research students, enable them to undertake research relevant to their interests and aspirations, provide opportunities for them to broaden their skills and understandings as well as deepen their knowledge, and facilitate their timely completion of research training with sound supervision in a quality research environment. Student completions account for 50per cent of the formula for allocating fully-subsidised research student places. In effect, those institutions who best serve their students will be best rewarded and students will have opportunities to do their research training in the best performing universities in particular areas of research.

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Government objectives, initiatives and measures

The Government’s stated objectives (Kemp, 2001) for its higher education policies are to:

• expand opportunity
• assure quality
• improve universities’ responsiveness to varying student needs and industry requirements
• advance the knowledge base and university contributions to national innovation, and
• ensure public accountability for the cost-effective use of public resources.

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2.1 Incentives for universities to respond to student needs

Today’s universities are having to respond increasingly to market needs, through the expression of student preferences as to what, where, when and how to study, and their service expectations. While particular services that universities can offer, such as research and consulting services, are potentially expanding market opportunities and are being purchased increasingly by businesses and government agencies, student consumer power is becoming the dominant driver of developments. However, Australia’s higher education system is still in a period of transition towards a more market-driven structure of provision. During this transition, shifts in the structure of incentives as established by the Government have particular potency.

The structured incentives that government has put in place for encouraging university responsiveness to student needs include: (1) negotiated, general-purpose government funding; (2) stipulated government funding; (3) performance-based government funding, including competitive tendering; (4) public accountability reporting; (5) student financing; and (6) quality assurance and consumer protection. The present combination of incentives is the product of a long period of policy evolution which is itself not typically a linear nor coherent process. At any stage the policy framework is under review in order to smooth out internal anomalies or accommodate change in the external environment. So it is possible that mixed signals are received by universities from time to time and that their response strategies may need to be varied or at least allow for contingencies.

Even within a consistent rhetoric of policy intent, such as ‘selectivity and concentration’ in research key incentives may be altered. A couple of universities, for instance, that responded vigorously to the opening of access to research grants and funding for research training in the early 1990s found themselves in a relatively difficult position with the addition of performance measures to the allocation of research training places a decade later. Even though advance notice was given of the changed incentives, through both an extended period of consultation and phased implementation, the nature of the change stretched the ability of some to ‘turnaround’.

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2.1.1 General government funding

Funding of planned enrolments by field and level: The bulk of Commonwealth funding is provided in the form a single block operating grant for teaching-related purposes. Funding is allocated to universities at normative prices for student enrolments, weighted by field and level of study. A ‘total student load target’ and an ‘undergraduate load target’ are set through negotiation and approved by the Minister. If a university consistently under-enrols below the agreed targets it may subsequently forfeit some funding or be required to compensate in later years by ‘re-instating’ the places. If the university offers fee-paying undergraduate places the penalties for under-enrolment against the targets are automatic and at a set funding rate per place.

The policy intent is to give universities flexibility in determining their mix of course offerings and student enrolments in accordance with their mission objectives and their own strategies. The policy impact has been a reasonable equilibrium between graduate supply and labour market absorption as measured by graduate employment and earnings. Some over-supply of places relative to student demand is apparent for agriculture, science and engineering. Some under-supply is apparent for health and veterinary science (Li et al, 2001:20).

Marginal funding for UG over-enrolment: Where a university meets its total load target and over-enrols against its undergraduate target it may be paid for the additional undergraduate places at the discounted minimum HECS rate ($2640 in 2001) as compared with the average funding rate per undergraduate place of $10,300. Each university can determine any level of over-enrolment consistent with its assessment of demand and capacity and its commitment to quality assurance.

The policy intent is to encourage resource utilisation efficiency and to give some benefit to institutions that use their capacity at the margin to accommodate additional students. The policy impact has been mixed. While some universities have managed the additional flexibility to accommodate changes in demand, others have over-enrolled beyond their marginal capacity and are spending much more per additional place than they receive for these extra places.

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2.1.2 Targeted Government funding

Competitive tendering for innovation in provision of places to meet skill shortages: In January 2001 a set of initiatives to foster national innovation was announced in the Backing Australia’s Ability package. Funding was provided for an extra 2000 student places. For the first time universities were invited to bid against a set of criteria to provide places in mathematics, science and technology and related fields for a fixed price per student place. Competitive bids were assessed for their strength, fitness to demand and innovativeness in curriculum and delivery. The winning universities have to sign up to ‘additionality’ agreements and their delivery against their tender specifications will be evaluated in subsequent years with a view to determining whether any places should be re-allocated.

The policy intent is to encourage more innovative educational offerings that are more relevant to the competitive needs of Australian businesses. The policy impact so far has been the development of new courses and innovations in course design and delivery consistent with the need to prepare graduates with appropriate skill sets.

Regional places: The 2001-02 Budget provided funding for an extra 670 places targeted to demographically growing regions with relatively low rates of higher education access and participation. For one region, Geraldton, as a trial of an option for allocating growth, tenders have been invited from all universities to serve community needs.

The policy intent is to increase regional access to higher education. The policy impact cannot yet be evaluated. However, new forms of regional provision are emerging, to which this initiative contributes. The new forms include multi-sector institutions (composite university/TAFE providers), multi-sector precincts (single campus administration, articulated courses offered and quality-assured by parent providers, including a university, a TAFE college and a State and/or private secondary school), course articulation agreements, where graduates from TAFE or other VET providers are given credit recognition for university awards; ‘hub & spoke’ university services incorporating a mix of contact and virtual delivery through ‘learning centres’ or ‘telecottages’; and fully on-line service provision.

Higher Education Innovation grants: An annual programme of grants is available for supporting innovation and collaboration in the development and provision of courses, such as collaborative provision in fields of low enrolment, innovative projects in science-related education, and projects to enable university access to information and communications technology.

The policy intent is to encourage innovation and diffuse best practice. The policy impact appears to have increased both the speed and spread of innovation.

Capital Development Pool: An annual programme of grants is available for specific capital works. The programme emerged as the residual element following the capital roll-in after the growth surge in funded enrolments in the early 1990s. It has been to directed to supporting campus development in new areas and, increasingly to encourage collaboration among universities and TAFE colleges, and investment in electronic delivery technology.

The policy intent is to support changes in demographically-driven demand. The policy impact is demonstrated by increasing university-TAFE collaboration and use of electronic delivery.

Workplace Reform Programme: Universities were offered a supplement of 2 per cent of their operating grants as a further contribution to the salaries cost outcome of enterprise bargaining. Conditions were attached to the funding for the purpose of encouraging flexibility in management, administrative and industrial arrangements.

The policy intent is to increase university responsiveness to student, industry and community needs. The policy impact is reflected in enterprise agreements that provide increased management flexibility.

Teaching development grants: An annual programme of grants is allocated on the advice of the Australian Universities Teaching Committee. The grants have supported individual and institutional projects and some collaborative projects. Recent emphasis has been given to examining curriculum and learning outcomes in particular fields of study and on general themes such as teaching large classes. Information about projects and developments is widely disseminated.

The policy intent is to raise the status of teaching and to improve teaching practice. The policy impact is reflected in increasing levels of graduate satisfaction with university teaching.

Australian awards for university teaching: National awards are presented annually to individuals and teams of university teachers by field and to institutions for their services to students and their communities.

The policy intent is to raise the status of teaching, recognise and disseminate good practice. The policy impact is reflected in greater attention by universities to teaching skills development of staff and teaching performance as a consideration in promotions.

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2.1.3 Performance-based funding

Performance-based funding for research training places: Funding for tuition-free research student places has been separated from operating grants for teaching-related purposes and allocated each semester, from 2001, through a performance formula weighted 50 per cent for completions (domestic and on-shore international graduates), 30 per cent research income and 10 per cent research output.

The policy intent is to improve the quality of research supervision and research training environments, to improve student completion rates and times, and to better relate research training to the needs and destinations of graduates. The policy impact has been strong and immediate, as is evident through the revised strategies of universities for intake of research students, a sharper focus on areas of research strength and greater attention to the selection, training and monitoring of supervisors.

Performance-based funding for research infrastructure: Funding for general research-related infrastructure is allocated through the Institutional Grants Scheme via a formula weighted 60 per cent research income (all sources of income treated equally), 30 per cent domestic research student load (with high cost places 2.35 times low cost places) and 10 per cent research output (with books 5 times the value of other outputs). From 2003 the output measures will include patents, refereed designs and exhibited works. A related programme – the Research Infrastructure Block Grants Scheme – differs from the IGS by according a double weighting for research income won from national competitive grants.

The policy intent is to support research excellence. The policy impact is a concentration of resources in the best performing areas.

Equity & Indigenous support funding: Support funds for equity target groups and Indigenous students are allocated annually on a performance basis according to student access, retention and success rates.

The policy intent is to achieve higher levels of participation and better outcomes for equity groups. The policy impact has been strong on increasing access but the relatively low incentive payments have not led to significant improvements in progression and completion. The HECS-exempt enabling programme is under review in the light of poor outcomes.

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2.1.4 Planning and accountability monitoring and performance reporting

Educational profiles strategic documentation: As a condition of operating grant funding the Minister may require universities to furnish planning documentation, data and reports. The present set of requirements include a strategic plan; an educational profile of enrolments; a capital management plan; a quality improvement plan; an equity plan; and a plan for Indigenous students. In 2001 a census of units of study is being conducted to identify the extent of web-enhanced and on-line provision. The Government has encouraged universities to specify the ‘attributes’ they aim for their graduates to have developed.

The policy intent is partly to guide resource allocation decisions and for public accountability reporting, and also to promote strategic improvement in university management. The policy impact is evidenced by improved institutional planning and reporting.

Research and Research Training Management Reports: In addition to the above set of plans the R&RTMR, introduced as part of the reforms announced in the 1999 White Paper, Knowledge and Innovation, requires universities to identify their research objectives and strengths, the outputs of research active staff, their IP management policies, the profile of their research students by field in relation to strengths, their policies for research supervision, and their performance in relation to their objectives.

The policy intent is to improve Australia’s research performance by concentrating resources on areas of strength, to increase the utilisation of research, including for commercial exploitation, to improve the quality of the research training experience and to improve completion rates and times. The policy impact has been strong and fast (mainly because of linkages to the RTS and IGS incentives above) especially on internal priority setting by universities.

Graduate Destinations and Satisfaction monitoring: The quality improvement plans and the R&RTMRs have some mandatory elements – graduate destinations and satisfaction for the former, and graduate satisfaction for the latter. A national survey of graduates is conducted annually by the Graduate Careers Council of Australia, tracing employment destinations and starting salaries. A national instrument, the Course Experience Questionnaire (and an equivalent instrument for Postgraduates) is used annually to obtain measures of graduate satisfaction with their overall experience, teaching and generic skills formation. A Graduate Skills Assessment instrument has also been developed for institutions, graduates and employers to use to verify the attributes that graduates are expected to possess.

The policy intent is to have public comparisons of institutional performance as perceived by graduates as an incentive for continuous improvement of universities. The policy impact is mixed in the context of variable response rates, signs of student ‘survey fatigue’ and a lack of consensus within the system as to the validity and reliability of such instruments.

Diversity characteristics & performance indicators: The Department publishes regularly, and maintains on its web site trend data for, various sets of comparative institutional performance indicators, including a web-based site for prospective students that relates to 10 fields of study.

The policy intent is to inform the community and institutions themselves about relative performance in a diverse system. The policy impact interacts with peer pressure and competition. With a large number of institutions and indicators it is possible for each university to construct a set that reflects best on it. Institution-wide indicators have limited influence of student choice, which appears to be informed by field of study.

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2.1.5 Student-financing incentives

Access through fee-paying: Overseas and domestic students can access higher education through direct payment of fees to universities. The universities can determine the volume of their enrolments and their prices in respect of overseas students (so long as the floor price recovers costs), postgraduate students (by coursework and research), and undergraduate students (except that institutions with HECS-liable students can enrol undergraduate fee-payers only up to 25 per cent of enrolments in a course).

The policy intent is to widen access and choice, and increase consumer pressure on universities to respond to community needs. The policy impact has been very strong for many but not all universities, as reflected in the wide variation in fee-paying enrolments across institutions. Universities report that fee-paying students are increasingly demanding in their expectations of service.

Access with Government assistance: Domestic students at universities listed on the tables of the Higher Education Funding Act can access an income-contingent deferred payment loan (HECS) to the level of the fee set by the Government for the course of their choice. From 2002, postgraduate coursework students at those universities will have access to a similar income contingent loan to meet fees set by universities. Students enrolled with Open Learning Australia, for undergraduate studies, also have access to a HECS-style loan, so long as they maintain a minimum study load for fees set by the Government; however, OLA can charge above the Government basic rate and students pay the gap directly through fees.

The policy intent is to enable equitable access and require the direct beneficiaries to pay a share of the costs. The policy impact has been powerful, as evidenced by strong growth in demand for HECS places. The deferred repayment option possibly dampens student consciousness of costs. Reductions in domestic postgraduate coursework enrolments that coincided with the increasing provision of places on an up-front fee-only basis gave rise to the PELS initiative.

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2.1.6 Quality assurance, international openness and consumer protection

Quality assurance framework – national protocols: Universities as self-accrediting institutions established by statute are responsible for ensuring their academic standards. The Commonwealth and State and Territory governments have agreed a set of national protocols that require universities to be established only by statute, protect the business name of university, require all other providers to be accredited and monitored by the State or Territory accrediting authority, and require monitoring of delivery arrangements involving other organisations, the operation of overseas higher education institutions in Australia and the endorsement of higher education courses for overseas students. Overseas students enrolled in registered Australian institutions have consumer protection rights through the Education Services for Overseas Students Act. The ESOS Assurance Fund addresses the problem of college collapses which have previously disrupted student studies and threatened the loss of their pre-paid fees. Unless exempted, providers of education and training to overseas students must contribute to the Assurance Fund. The quality assurance processes of universities and accrediting bodies are to audited over a five-year cycle by an independent Australian Universities Quality Agency. Reports of audits will be made public and follow-up action by universities and other providers will be assessed by the responsible government.

The policy intent is to assure the quality of Australian higher education to students and the community, to underpin the competitiveness of Australian universities overseas, to prevent the operations of providers that do not meet required standards, and to protect students as consumers. The policy impact has been strong on those few providers found to be operating without meeting standards. The more competitive environment, performance reporting requirements and the external audit cycle are requiring universities to maintain their attention to matters of quality.

General Agreement on Trade in Services commitment: Australia is one of the few World Trade Organization members to make ‘education services’ commitments under the General Agreement on Trade in Services. One of Australia’s commitments places ‘no limitations’ on market access for the provision of private university level education services. The commitment provides a competitive stimulus to institutions with flow on benefits to students.

The policy intent is to widen student choice and expand opportunities for Australia’s universities overseas. The policy impact is reflected in Australia’s relatively high share of the world trade in education.

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3. University responses

In broad terms the higher education system has responded reasonably well albeit somewhat slowly to the various incentives. It appears to be responding more quickly in the context of increasing competition and direct pressure from students. Even the more recent policy initiatives, especially the reforms to research and research training, are having immediate impacts on university planning and practice.

Total student enrolments have grown by 210 419 or 43 per cent over the period 1990 to 2000. Overseas students, either paying fees or funded through aid programmes and drawn from 207 countries, have trebled over the same period to 95 607, representing one third of the overall increase in student numbers. Fee-paying student (full-time equivalent) enrolments represent one quarter of total enrolments in 2001, including both domestic and overseas students. The fee-paying share of Australian student enrolments has increased from less than 3 per cent in 1992 to over 10 per cent in 2001. The share of total fee-paying enrolments (including off-shore) varies across universities from 5 per cent to 44 per cent.

Table 1a shows a shift to external student enrolment over the decade of some 3 percentage points and a corresponding decline in the proportion of full-time students.

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Table 1a. Higher Education Students, Australia, Selected Characteristics, 1990 - 2000

Source: Higher Education Students Time Series Tables 2000, DETYA.2001

For 2000, using a more recent classification, the spread of enrolment types is shown in Table 1b. The share of part-time enrolments ranges from 20 per cent to 68 per cent across universities.

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Table 1b. Higher Education Students by Type of Enrolment, 2000

Table 2 shows growth in the student body aged 20 through to 30 years and a corresponding decline by some 7 percentage points in the younger, direct from school age cohort.

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Table 2. Commencing Higher Education Students by Age, 1990 - 2000

Source: Higher Education Students Time Series Tables 2000, DETYA. 2001

Table 3 shows the basis for admission of undergraduate pass level commencing students in 1990 and 2000. Admissions direct from school have fallen from 59 per cent in 1990 to 56 per cent in 2000, while admissions from TAFE have risen from 3 per cent to 7 per cent. Overall there has been a modest widening of university admissions.

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Table 3. Basis for Admission of Non-Overseas Pass Level Commencing Students

Table 4 shows growth in the absolute number of students in designated equity categories from 1991 to 2000. Whereas all non-overseas students grew by 18.8 per cent over the period, enrolments of Indigenous students grew from a very low base by 60 per cent, students from low socio-economic backgrounds by 25 per cent, and students from rural and isolated communities by 19 per cent. Massification of higher education appears not to have been exclusively to middle-class advantage. Some refinement of socio-economic indicators is required and is underway, in view of problems associated with the reliance on postcode data. Changes in NESB enrolments largely reflect shifts in immigration policy. Achievements for women in non-traditional areas whilst impressive need to be interpreted in the context of increasing feminisation of the higher education student body.

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Table 4: Non-Overseas Students by Equity Group 1991 to 2000

Equity group shares vary among universities reflecting their location but also their mission and commitment to equity objectives. For instance, Indigenous enrolments (excluding Batchelor and Notre Dame) range from 5 per cent to 
0.1 per cent. Rural students range from 82 per cent to 3 per cent. Low socio-economic status students vary from 42 per cent to 4 per cent. Students with a disability ranged from 1.3 per cent to 7.5 per cent. Additional effort is normally required by universities in attracting students from these groups and serving their varying needs.

Table 5 shows changes (number and percentage) in enrolments of commencing Australian students by course field and level between 1992 and 2000. The largest percentage growth occurred at the Graduate Certificate level and especially in Health, Science, Business, Law and Engineering. Enrolments for Postgraduate Diplomas, however, declined across all fields except Health, Legal

Studies and Veterinary Science. Masters by Research enrolments fell across all fields. Bachelor Honours enrolments grew in all fields except Education and Veterinary Science. Bachelor Pass degree commencements grew in all fields except Health, with by far the highest rate of growth in Law. At the sub degree level, Advanced Diploma commencements fell overall but accelerated in Engineering and grew also in Business and Agriculture. Diploma enrolments fell heavily in all fields except Law, which experienced significant growth. Other undergraduate award courses grew strongly in most fields except Legal Studies.

These significant shifts in commencing enrolments variously across levels and fields suggest a higher education system that is reasonably responsive to labour market needs as expressed through student choices.

Exploring the relationship between student applications, university offers and enrolments over 1992 to 1999, Li et al (2000) found a complicated picture but one that supports the view that Australian universities are responsive to student demand to some extent. They are most responsive to school leaver demand and accommodate the balance of their enrolments to meet government targets through their acceptance of direct applications:

When we took account of movements in enrolments we found that the supply of offers was directly related to the demand for places. Universities were responsive at this level. For every additional 100 applications through the admission centres there will be an additional 84 offers. It also appears that the majority of additional places provided by Government go to those who apply through the admission centres (mostly school leavers). For every additional 100 enrolments an additional 150 offers are made. What appears to be the case is that direct new enrolments are the ‘swing’ variable, which universities use to meet the aspirations of those who apply through admission centres and the requirements of Government.

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Table 5a: Changes in Commencing Non-Overseas Students (Number and Percentage) by Level of Course and Broad Field of Study between 1992 and 2000.

Table 5b: Changes in Commencing Non-Overseas Students (Number and Percentage) by Level of Course and Broad Field of Study between 1992 and 2000.

Notes.
(a) Postgraduate Qualifying/Preliminary and Doctorate by Coursework
(b) Bachelor's Pass, Honours and Graduate Entry
(c) Associate Degree and Other Award Courses.
(d) Enabling and Non-award Courses
(e) Agriculture, Animal Husbandry; Architecture, Building; Veterinary Science and Non-Award

Source: Higher Education Student Data Collection: 11/09/2001
Note: Data from 1997 onwards takes into account the coding of combined courses to 2 fields of study As a result, the sum of all broad fields of study may be more than the Total Number of Students

Li et al (2000) also found some evidence of university responsiveness to shifting student demand by field of study. However, they also found some stickiness that may reflect staffing and infrastructure inflexibilities which constrain quickness of response. Several matters warrant more detailed investigation.

Table 6 indicates that universities have been striving to increase their staffing flexibility over time, though at a slower rate than for the economy overall. Full-time staff comprised 82 per cent of all staff in 1991, falling to 75 per cent in 2000, while casual staff rose over the decade from 10 per cent to 15 per cent.

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Table 6. FTE for Full-time, Fractional Full-time and Estimated Casual Staff by Work Contract, 1991 to 2000

The composition of staff also changed, with some hollowing-out of the lecturer and senior lecturer levels, as illustrated in the figure below. Growth occurred at the below lecturer and above senior lecturer levels, the latter possibly reflecting traditional promotion practices.

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One consequence of the apparent imbalance between university responsiveness to student demand and internal rigidities has been some upwards movement in student: staff ratios. These shifts have not been uniform, either across Academic Organisation Units or among universities. For the Sciences the SSR increased by 15 per cent over 1993 to 1999, with the equivalent rates for Health Sciences 
8 per cent, Social Studies 11 per cent, Administration, Business, Economics, Law 19 per cent and Education 47 per cent. In 1999 the SSR for Humanities ranged across universities from 12 to 31 with an average of 19. For Social Studies the range among universities was from 15 to 32; in the Sciences from 9 to 19, and in Mathematics/Computing from 14 to 33. Clearly there are institution-specific explanations for these variations.

A related matter that warrants further investigation is that of very small student enrolments in units of study. Table 6 shows some 20 656 units, 23 per cent of the total, are recorded as having fewer than 5 students enrolled in 2000. The discipline group with the largest number of units with small enrolments is Humanities (30 per cent) and the lowest (17 per cent) Built Environment. There are some coding issues with these data which would tend to exaggerate the apparent problem; however, it appears there is scope for efficiency improvement that may enable several institutions to better accommodate student numbers, and reduce SSRs, in the larger units.

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Table 7. Percentage of small Units (<5 enrolments) by Broad Discipline Group - excluding research students, 2000

Source: Higher Education Student Data Collection - 22/06/01

There is also wastage associated with poor retention, progression and completion rates for students in some institutions in some fields. Martin et al (2001a) find that only 64 per cent of the cohort of commencing undergraduate students in 1992 completed an award at the university where they enrolled by 1999, and estimate a final completion rate of 71.6 per cent for that cohort. For the 1993 cohort, the final completion rate is estimated at 70.8 per cent. Martin et al (2001b) report that by 1999, 53 per cent of postgraduate research doctoral students and 31 per cent of masters students who commenced an award course in 1992 had completed that course. They estimate the final completion rates of the cohort to be 65 per cent for doctoral and 48 per cent for masters students. They also found that "university specific factors explain a significant proportion of the variation in completion rates".

The universities generally are responding positively and genuinely to the need to give more and better attention to their students, reinforced by government incentives to do so and by competitive pressures. There also have been many advances in curriculum design, more flexible provision of courses and combinations of courses, and improvements to teaching and assessment practices across the system. There is a discernible shift in the valuing and professionalising of teaching and a stronger focus on learning outcomes. Substantial investments have been made in the design and development of sophisticated on-line materials, units of study, interactive learning experiences and student support services. The best in this regard are world leading practice. Several universities are now more actively engaging with their regional communities educationally, culturally and economically.

However, there are further challenges ahead. Dunkin and Lindsay (2000) contrast the assumptions that traditionally underpin curriculum design for a cohort of students commencing higher education direct from school with those relevant to a cohort of lifelong learners:

In designing our teaching and learning programmes we tend to assume that:

• the target audience are school leavers with minimal life experience and a high need for structure and guided learning;
• this group needs an initial post-secondary qualification to begin a career;
• the students are full-time and/or available to attend campus-based instruction;
• programmes should reflect professional/ vocational or disciplinary specialisations; and
• academic staff provide the gateway to knowledge expertise and their role is to disseminate this knowledge.

Yet those who pursue lifelong learning are commonly:

• working adults who are accustomed to managing themselves in work or life;
• forced to juggle competing demands for their time and their resources;
• increasingly seeking updated or further formal education to support their career, and the frequent and lateral moves that are now open to them;
• facing problems at work that are multi-faceted and require systemic or team-based solutions/ approaches; and
• able to access knowledge/ information through several different avenues.

Dunkin and Lindsay point to some of the implications of this shift in the student population, including the need for new ways of teaching and learning, the application of adult learning theory that calls for a wider range of learning experiences (and respect for and recognition of the prior experiences of students), and the tailoring of courses to meet the needs of paying customers.

Long and Hayden (2001) report the findings of a survey of 34,000 students in 19 universities that 75 per cent of female and 69 per cent of male undergraduate students were likely to be in paid employment. Of full-time students males worked an average of 14.6 hours a week and females 14.4 per cent. Some 7 per cent of students reported missing classes ‘frequently’ and a further 21 per cent ‘sometimes’ because of their paid employment. As well as commenting on issues of income support, "students believed that universities needed to be more flexible in their delivery of courses":

Most suggestions focused on timetabling, but others included an appeal for greater understanding by lecturers, greater emphasis on distance education techniques or even taping lectures and modifying assessment so that it did not reward attendance per se.

McInnis (2001) reflects on the changing "patterns of student disengagement and new forms of engagement, to which many institutions, and the system at large, have still not adjusted in much more than an ad hoc way". He identifies the growing proportion of students in combined degrees and cross-discipline studies, and the increasing number of hours per week worked by students, and their changing patterns of usage of on-line materials and campus services. He suggests that "universities will need to reorganise the academic year to accommodate the increasingly diverse demands from undergraduate students to manage paid work and study" and, more generally, enable students to negotiate their engagement in ways that best suit their circumstances:

The range of institutions, courses and subjects now available, combined with the increasingly sophisticated access to flexible modes of knowledge delivery and electronically generated communities of learners, puts students in a powerful position to shape the undergraduate experience to suit their own timetables and priorities.

A new set of expectations of university responsiveness, now driven more directly by students themselves, is rapidly emerging. The responsiveness of universities so far to the set of incentives of recent years positions them in many ways to accommodate the new demands. The competitive pressures of the future are likely to urge increasing responsiveness.

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4. References

Commonwealth Tertiary Education Commission, 1986, Review of efficiency and effectiveness in higher education. AGPS. Canberra

Davies, S. 1988. The Martin Committee and the Binary Policy of Higher Education in Australia, Ashwood House (Academic Division). Melbourne Dawkins, J. 1988. Higher Education - a policy statement. AGPS. Canberra.

Department of Employment, Education and Training, 1993. National Report on Australia’s Higher Education Sector, AGPS. Canberra.

Department of Education, Training and Youth Affairs, 2001, Higher Education Students Times Series Tables 2000 – Selected Higher Education Statistics. Canberra.

Dunkin, R. & Lindsay, A. 2001. "Universities as Centres for Lifelong Learning" in International Handbook of Lifelong Learning, Part Two. Aspin, D., Chapman. J., Hatton, M. & Sawano, Y. (Eds). Kluwer Academic Publishers. London.

Karmel, P. 1998. "Funding Mechanisms, Institutional Autonomy and Diversity", in Meek, V.L. & Wood, F. Q., Managing Higher Education Diversity in a Climate of Public Sector Reform, EIP Report, Higher Education Division, DETYA. Canberra.

Kemp, D. 1999. Knowledge and Innovation: a policy statement on research and research training. AusInfo. Canberra

Kemp,D. 2001. Higher Education Report for the 2001 to 2003 Triennium. DETYA. Canberra.

Li,J. Karmel, T. & Maclachlan,M. 2000. Responsiveness – Do universities respond top student demand? Occasional Paper Series 00/F, Higher Education Division, DETYA. Canberra

Long, M. & Hayden, M. 2001. Paying their way – a survey of Australian undergraduate university student finances, 2000. AVCC. Canberra

Maister, D. 1993. Managing The Professional Service Firm. Simon & Schuster. New York.

Martin, L. et al. 1964. Tertiary Education in Australia, Report Of The Committee On The Future Of Tertiary Education In Australia To The Australian Universities Commission. Commonwealth Government Printer. Canberra.

Martin, Y.M., Maclachlan, M. & Karmel, T. 2001 a. Undergraduate Completion Rates: An Update. Higher Education Division. DETYA. Canberra.

Martin,Y.M., Maclachlan, M. & Karmel, T. 2001b. Postgraduate completion rates. Higher Education Division. DETYA. Canberra.

McInnis,C. 2001. Signs of Disengagement?: The Changing Undergraduate Experience In Australian Universities, Inaugural Professorial Lecture, Faculty Of Education, The University of Melbourne

Murray, K. et al. 1957. Report of the Committee on Australian Universities. Commonwealth Government Printer. Canberra.

Nowotny, H., Scott, P. & Gibbons, M. 2001. Re-Thinking Science – Knowledge and the Public in an Age of Uncertainty, Polity Press, Cambridge. UK.

Universities Commission, 1975. Recommendations for 1976. AGPS. Canberra.

Universities Commission, 1976, Report for 1977 - 79 Triennium. AGPS. Canberra

West, R. et al. 1998. Learning For Life Final Report, Review of Higher Education Financing and Policy. DETYA. Canberra.

Williams, B. (chair) 1979, Education, Training and Employment: Report of the Committee of Inquiry into Education and Training. Volume 1. AGPS. Canberra

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