MEDIA RELEASE

PRODUCTIVITY COMMISSION REPORT

30 September, 2002 MIN 189/02

As a part of the Review of Higher Education the Productivity Commission was requested to examine how Australian higher education compared to some overseas experiences.

The Productivity Commission has now completed a draft of its report; "University resourcing: Australia in an International Context".

It should be noted that the Productivity Commission says that diversity between countries in the scope, size and nature of their tertiary sectors meant that it was not possible for the Productivity Commission to ‘benchmark’ the comparative performance of universities. (p.1)

Nevertheless the draft report provides valuable research for further discussion of the ways in which we can improve Australia’s higher education system to meet the needs of the 21st century.

The report found that participation in Australian Higher education is very high – exceeded only by the United States and Korea. (p.4)

The report notes that Australian universities have larger class sizes on average than Canadian and United States universities (p. 22) and that Australian lecturers are amongst the best paid of the countries studied (p.23).

The report finds that of the countries examined, Australia is second only to Canada in terms of annual expenditure on universities per student (p. 31).

In terms of Government investment in higher education, the report places Australia on par with Canada and ahead of the United States (p. 32). However it should be noted that this analysis does not include the cost to the Commonwealth of providing HECS loans to students. With total HECS liabilities currently at about $8.7 billion, this costs in the vicinity of $300 million each year in subsidies.

The report highlights the significant part private donations, endowments and alumni contributions play in overseas universities and how small a part they currently play in this country.

"For nearly half the selected overseas universities, revenue from ‘other’ sources accounted for a greater proportion of the total revenue than revenue from either government or students." (p.79)

At the extreme end are the resource rich US universities of Yale, Pennsylvania and Stanford, each with total revenues of more than US $2.6 billion a year.

The report notes that Australian universities range between $57.4 million and $847.4 million in total revenue. (p.xiii)

The level of Australian university debt was found to be lower than that of most overseas universities. (p.xiv)

I welcome the Productivity Commission report as a valuable contribution to the Review of Higher Education.

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