Universities call for funding policy overhaul as cuts bite

As Australia’s universities announce the elimination of hundreds of courses – and recent data obtained by the Guardian suggest a projected loss of over 2,400 academic jobs by 2027 – stakeholders are warning that a rethink of how universities are funded is needed.

Hundreds of courses in disciplines such as teaching, languages, media, archaeology, and humanities are being eliminated, according to the Guardian’s analysis. Universities attribute these cuts to financial instability, policy uncertainty, and declining international student enrolments.

Higher education leaders argue that weak governance and the controversial Job-Ready Graduate (JRG) scheme, which raises the costs of studying humanities and social science subjects and tries to encourage students to pursue high-demand career choices, have exacerbated the situation, raising questions about the future of higher education in the country.

Vicki Thomson, chief executive of the Group of Eight (Go8), Australia's leading research-intensive universities representing eight institutions that conduct the majority of the country's research, told University World News that the crisis is the culmination of long-term structural issues.

“This hasn’t happened overnight. For too long we have operated under a distorted funding model whereby international fee revenue props up our national university research effort – 70% of which takes place in Go8 universities – and our domestic teaching. This is unsustainable. We need to take a genuine look at how Australia's university sector is funded," she said.

Policy and funding settings

Luke Sheehy, chief executive of Universities Australia, the peak body representing all Australian universities, advocating for policy, funding, and sector-wide reforms, echoed this concern.

“Any job losses in the university sector are a tragedy. A decade of successive and consistent changes to policy and funding settings have had terrible consequences on our sector, resulting in a billion dollars less each year for teaching, investment in research falling to a record low, and the end of dedicated funding for university infrastructure.

“Many of our universities are understandably in a difficult financial position because of the policy actions of successive governments,” he told University World News.

The University of Technology Sydney (UTS) recently unveiled an AU$100 million (US$66.05 million) restructuring plan that includes the closure of schools of education, public health, and international studies, alongside a merger of its business and law faculties.

The plan will cut 134 academic positions and more than 1,100 subjects. UTS aims to reduce its 24 schools to 15 and its six faculties to five, seeking savings of AU$80 million, according to local media reports.

Similarly, the Australian National University (ANU) has already cut 399 positions amid restructuring. While the university backed away from forced job cuts after a high number of voluntary redundancies, many academic programmes remain at risk, according to news reports.

Other institutions, including the University of Southern Queensland, are also making major cuts, according to a report in The Age. Proposed restructures could eliminate another 150 full-time positions, following 109 job losses in late 2024.

Before all of this, the COVID-19 pandemic in early 2020 forced Australian universities to adjust rapidly, reducing staff and scaling back operations. Subsequently, the international student enrolments, which fund a significant portion of teaching and research, fell sharply.

Moreover, the Job-ready Graduates package, introduced in 2020, cut funding for domestic Commonwealth-supported student places by around 6%, further straining finances.

Combination of factors

Thomson of the Go8 attributes the cuts to these structural pressures. “We’ve reached this point through a combination of factors. In addition to funding pressures, policy settings, particularly around international education and domestic policy such as the Job-ready Graduates scheme, have come home to roost.

“The Job-ready Graduates scheme has been an unmitigated disaster. Universities have been asked to do more with less. The Go8 never supported the [scheme] and warned the Morrison government of the potential consequences,” she said.

Sheehy also highlighted the impact of government policy actions.

“A decade of successive and consistent changes to policy and funding settings have had terrible consequences on our sector – resulting in a billion dollars less each year for teaching, investment in research falling to a record low, and the end of dedicated funding for university infrastructure.

“Many universities are understandably in a difficult financial position because of the policy actions of successive governments,” he said.

Government-imposed caps on new international students, combined with a post-pandemic slowdown, have caused financial shortfalls, they argue. For ANU alone, projected revenue losses from declining international enrolments total AU$22 million, according to Times Higher Education. Universities Australia has warned that such policies could trigger 14,000 job cuts across the sector, according to a local news report.

The Job-ready Graduates scheme aimed to steer students toward courses with higher employment outcomes by adjusting fees. In practice, the scheme disproportionately affected non-STEM disciplines, according to an article from the think tank, the Australia Institute. Humanities courses more than doubled in cost, while funding for STEM courses like engineering fell by 16%, despite critical skill shortages.

The consequences of widespread cuts are significant for staff, who experience higher workloads and job insecurity, and students, who face fewer choices.

Mehr Mohsin Raza, a research fellow at the School of Education, Deakin University, told University World News that education policies focusing heavily on economic orientated subjects and neglecting humanities and social science subjects would lead Australia nowhere.

“Australia needs to invest in research on its rich Aboriginal culture, civic education subjects and keep a nice balance between pursuing rigorous economic growth as well as teaching and embedding values among citizens in the society,” Raza noted.

Societal effects

Thomson warned of broader societal effects. “If this trend continues, the consequences will be profound and irreversible. Students will face fewer choices, particularly in disciplines that foster critical thinking, cultural literacy, and civic engagement – at a time we need it most,” said Thomson.

“The dismantling of humanities and social sciences risks weakening Australia's ability to respond to complex societal challenges – from climate change to democratic resilience. We are living in changing and challenging times. Social cohesion is at an all-time low, and the geopolitical situation is unstable. The role and responsibility of universities in society today has never been more important,” she said.

Sheehy reinforced this point, highlighting universities’ broader role.

“Australia’s universities are an essential ingredient in our country's future, educating the skilled workforce our economy needs and driving innovation through research to lift productivity,” he said.

“Changes in our economy and strategic environment mean Australia needs more of both, but chronic underfunding and confused policy settings are holding universities back.”

The Australian government has defended its approach, arguing that recent reforms are designed to stabilise and modernise the system.

The Department of Education has extended the Higher Education Continuity Guarantee into 2025, ensuring universities receive guaranteed Commonwealth Grant Scheme funding regardless of enrolment fluctuations.