The law of unintended consequences warns us that that an intervention in a complex system tends to create unanticipated and often undesirable outcomes. Never more so than in the case of the Australian Government’s Job-ready Graduates Higher Education Reform Package, which is supposed to increase the pipeline of graduates in national priority fields, particularly STEM.

Frank Larkins and Ian Marshman confirm that under the new funding model, there will be perverse incentives for universities to swap places in STEM courses for places in humanities courses, to achieve an increase in their funding from $24,200 for one engineering student to $234,000 for fifteen humanities students.

While students themselves do not respond much to financial signals as Andrew Norton has shown, history suggests that universities are exquisitely sensitive to funding signals, and will chase income.

To counteract this, the minister announced that the Tertiary Education Quality and Standards Agency (TEQSA) would “as part of its mandate … investigate substantial shifts in enrolment patterns at universities and consider the implications for educational quality and provider governance.”

However, TEQSA’s mandate is to ensure that providers comply with the Higher Education Standards Framework (Threshold Standards) 2015, not to consider the implications of changes in student load arising from a new funding model.

TEQSA would have to use a risk-based approach to assess whether a particular university was in danger of breaching particular standards, and it is hard to see how this could be done.

What could the risks to quality be in a large and abrupt shift in student load into the humanities? Hypothetically, there could be risks to course quality, risks arising from student numbers rising faster than the numbers of suitable academic staff and risks of a reduction in admission standards.

All universities have credible arts courses, so course quality is unlikely to be endangered.

The university planners that Larkins and Marshman refer to in their article could run up suitable workforce plans in a week or two that would outline the baseline academic staff in their arts faculties and show how staff would be scaled up commensurably with the student pipeline. Governing bodies will no doubt approve these after due deliberation, mindful of their responsibility to maintain financial viability and the resources needed to sustain quality.

That leaves admission standards, which could be problematic. In search of more students, universities might lower their ATAR requirements. Already, some universities are already accepting very low ATARs – according to Course Seeker, a score of 31.5 will get you into the Bachelor of Arts at Federation University (Gippsland). However, more and more students are admitted on criteria other than an ATAR requirement, and some courses do not specify one at all, such as the Bachelor of Arts at Victoria University (Footscray Park).

And the Threshold Standards do not require any specific level of admissions requirements, stating only the general principle that the provider must admit students with enough academic background to make a start (“participate”) in their intended course.

It would be challenging for TEQSA to sustain a finding that a university was admitting students who should not be given the opportunity to undertake a course. How would they do this? If attrition rates increased sharply, this could be an indication that the additional students were not up to the mark, but that would take years to become evident. In any case an indicator is by definition indicative, not definitive, and so cannot be used as the basis for a regulatory decision, although it can be considered.

There are too many layers in the government’s plan, addressing too many dimensions. They would be wise to cut a layer out and concentrate on aligning total fees with teaching costs per field, and then raising student contributions relative to government contributions for some fields according to long-term financial returns to the individual. Introducing future employability (national employment priorities) as a third dimension is confusing everything, as the assumptions behind this are not evidence-based, and adjusting a two-dimensional sliding scale according to three dimensions presents a diabolical problem.

And then there is the fourth dimension – the impact on research funding – but I will leave that to the research funding specialists!


Dr Michael Tomlinson

TEQSA Director (to January 2020), Higher Education Consultant and English Literature graduate (three times over)


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