Submission to the Higher Education Base Funding Review March 2011

The University of Sydney Submission to the Higher Education Base Funding Review March 2011

Contents 1. Executive summary ...... 3 2. Structure and content of our submission ...... 4 3. Defining key terms and objectives ...... 5 4. A changing operating environment ...... 6 5. Time to move on from the Relative Funding Model ...... 6 6. Problems with using historical costs data to determine future funding levels ...... 7 7. Enduring principles to underpin public investment in higher education ...... 7 8. Overview of the University’s current circumstances, key issues and challenges ...... 10 8.1 Comparing 1990 and 2010 ...... 10 8.1.1 The University in 1990 ...... 11 8.1.2 The University in 2010 ...... 11 8.2 The factors that have contributed to the trends ...... 12 8.3 How the University manages disciplinary funding shortfalls ...... 12 8.3.1 Possible adverse impacts on teaching quality ...... 13 8.3.2 The success of full fee provision through our Summer School ...... 15 8.4 The University Economic Model ...... 15 8.5 Key current challenges ...... 16 8.5.1 The relationship between education and research ...... 16 8.5.2 The costs of supporting research ...... 18 8.5.3 Preparing the next generation of researchers ...... 20 8.5.4 Sustaining and measuring quality ...... 21 8.5.5 Workplace learning ...... 24 8.5.6 Developing and maintaining infrastructure ...... 26 8.5.7 Providing high quality student support services and amenities ...... 28 8.5.8 Access and support for other students with particular needs ...... 29 8.5.9 The trend to postgraduate coursework provision ...... 31 8.5.10 Disciplinary specific challenges ...... 32 Agriculture...... 32 Archaeology...... 33 Architecture and related fields…………………… ...... 34 Dentistry……………………...... 34 Engineering...... 35 Law...... 35 Medicine...... 36

Music...... 36 Performance Studies...... 36 Pharmacy...... 36 Social Work...... 37 Veterinary Sciences...... 37 9. Conclusion ...... 38 Appendices...... 40 Appendix 1 Base Funding Review Consultation Questions ...... 40 Appendix 2 The University of Sydney Key Indicators, 1990 and 2010 ...... 42 Appendix 3 The University of Sydney Economic Model...... 45 Appendix 4 Estimating the proportion of base funding used to support research at the University of Sydney...... 46 Appendix 5 Costing undergraduate research programs ...... 48 Appendix 6 Sample Student Service Fee Schedules...... 50 University of Sydney Faculty submissions...... from page 55. Appendix 7 The Faculty of Architecture, Design and Planning submission ...... Appendix 8 The Faculty of Dentistry submission ...... Appendix 9 The Faculty of Veterinary Science submission ...... Appendix 10 The Sydney Medical School submission ...... Appendix 11 The Sydney Conservatorium of Music submission ......

1. Executive summary

Our core argument

Our core argument is that the current cluster funding framework (based as it is on the Relative Funding Model – RFM – established over twenty years ago) has passed its use by date. We do not believe that further tweaking or short term fixes to the current arrangements will be sufficient to underpin in the long term a high quality Australian higher education system. Indeed, we argue that rearranging the current funding clusters within a fixed funding envelope would simply serve to shift the problem instead of address it seriously. Such an outcome would simply mean that in five to ten years time, another review will be required to iron out new anomalies that have emerged.

The base funding framework needs to be replaced at an appropriate time by a new transparent and rational approach. This should be principles-based and built around a clear statement of purpose. It should be based on a robust understanding of the actual costs of sustaining high quality educational environments in different disciplines and settings. It should be responsive to reasonable changes in costs incurred by providers over time.

The Review, together with the imminent shift to the demand-driven system provide a rare opportunity, indeed imperative, for consensus to finally be reached about the vital importance of moving to a higher education base funding framework that is capable of achieving nationally agreed objectives for the future of the sector.

The key outcomes we seek

The Australian Government is currently pursuing greater transparency and accountability in relation to the costs and quality of publicly funded research, research training and the clinical training for health professionals. We see the Base Funding Review as providing a similar window of opportunity to put Australia on a clear path towards achieving transparency and accountability in the funding and delivery of higher education teaching and learning.

We feel that the Review Panel would do the nation a great service if it could look beyond the enormous amount of detail and special pleading to which it will no doubt be subjected, to take a long-term strategic view.

Acknowledging the current budgetary and political context in which the Review is being conducted, the outcomes that we would hope for from the Review are that it:

1. Makes a clear and compelling case about the need for the transition to be made to a new principles-based funding framework at an appropriate time in the future.

2. Proposes for discussion and debate options for new principle-based funding models, which are based on a clear statement of the purpose of base funding.

3. Provides clear advice about the preparatory work that would need to be undertaken in order to make a smooth transition to a preferred new framework.

4. Identifies those disciplines where the delivery of education at an acceptable international standard appears to be most at risk at present as a result of current base funding levels.

5. Recommends practical options and levels of possible funding assistance that should be provided to these ‘at risk’ disciplines, in advance of the transition being made to any new base funding framework. We emphasise, however, that any such adjustments to funding levels in some disciplines should not come at the expense of other disciplines.

Our approach

In making these arguments and seeking these outcomes, our submission seeks to complement the submission made by the Group of Eight (Go8) and Universities Australia. In doing so, our submission provides information, commentary and analysis, specific to the University of Sydney, which we hope the Review Panel finds helpful. It

3 includes as appendices submissions from five of our faculties which address particular concerns about the current base funding arrangements relevant to their disciplines.1

While we have not answered the specific consultation questions separately, we have indicated at various points in the submission where we have sought to address particular questions raised in the Consultation Paper. For ease of reference, a list of the consultations questions, cross referenced with the relevant sections of our submission, is included as Appendix 1.

We trust that, in addition to the information that we will provide as part of the Access Economics study commissioned by the Review, our submission provides information, ideas and perspectives that will assist the Panel with what we acknowledge is a most difficult but important task.

2. Structure and content of our submission

We start our submission by providing some commentary on key definitions and objectives, the history of the current base funding model, and the utility of relying on historical data about cost relativities to inform thinking about future levels of funding support for the Australian higher education sector.

Second, we respond to the Review Panel’s request for thoughts about the enduring principles that should underpin base funding for higher education in Australia. We welcome the approach, as we believe it offers the best way of articulating a clear vision for the future of the base funding framework. We suggest that once agreement can be reached about the fundamental purpose of base funding, the necessary supporting principles and required architecture should fall into place relatively easily. In so doing we support the Go8’s proposed statement of purpose, ‘Australia’s higher education system should be of international quality’, as a useful starting point for discussion. We offer for consideration a set of ten supporting principles around which we believe a robust new base funding architecture could be built and implemented.

Third, we provide comparative data about the University from 1990 and 2010, in order to demonstrate to the Panel some of the major trends that have occurred here over the 20 years that the current RFM-based funding arrangements have been in place. We acknowledge that many different developments have contributed to the trends that are apparent. Nevertheless, we argue that the base funding system has been one important contributing factor.

We explain how the University manages disciplinary funding shortfalls at present, and detail how we believe the base funding arrangements have impacted negatively on our major core generalist degree programs. We argue that any further adjustments to current base funding clusters, if made within a fixed funding envelope, are likely to affect adversely the quality of provision in other disciplines and simply result in institutions adjusting their internal cross-subsidies to minimise the impact.

Fourth, we provide an overview of the University’s economic model (UEM), which seeks to maximise transparency in the allocation of resources and the recovery of costs. The aim of the UEM is to maximise incentives across the University to increase income and reduce costs. We hope the Panel will find it helpful to understand our new economic model, as it is through internal allocative tools such as this that any changes to base funding must flow in order to deliver changes within institutions.

Fifth, we address the relationship between base funding and research. We discuss the history of the connection between funding for education and research in Australia. We provide an estimate of the extent to which we currently rely on funding from discretionary sources of income, including base funding, to sustain our research effort. We argue strongly for the Review Panel to recognise the vital importance of ensuring that it remains appropriate for institutions to have the flexibility to apply a component of their base funding to support their

1 Separate faculty submissions are included as appendices for the following faculties: Appendix 7 The Faculty of Architecture, Design and Planning, Appendix 8 The Faculty of Dentistry, Appendix 9 The Faculty of Veterinary Science, Appendix 10 The Sydney Medical School, Appendix 11 The Sydney Conservatorium of Music. The Faculty of Architecture, Design and Planning endorses the submission made by the Council of the Australian Deans of the Built Environment and Design, which is included as an attachment to the covering letter from the Dean. The Faculty of Dentistry has been part of a study commissioned by the discipline and has referred to some of the outcomes of that work in its submission. The Faculty of Medicine has undertaken its own costing of teaching and training medical practitioners and plans to provide this information to the Panel in April. The Faculty of Veterinary Sciences will provide its full submission by 8 April 2011.

4 research and research training missions. Alternatively, if support for such activities is to be excluded from base funding, care will need to taken both to ensure that great damage is not done to the fabric of Australia’s research-intensive universities in particular, and also to ensure that research-enriched teaching, informed by deep scholarship is not undermined by a simplistic notion of teaching and research as distinct realms. In our view they are integrally related.

We discuss some of the challenges we face in preparing the next generation of researchers to underpin the innovation system and replenish the academic workforce. For example, we provide detailed costing estimates for our Talented Student Program in the Faculty of Science as well as the cost of providing high quality honours experiences to students in three key science disciplines: Mathematics and Statistics, Physics and Chemistry. We suggest that it would be in the national interest for base funding to recognise the higher costs of programs designed to realise the potential of the nation’s most talented students.

The base funding arrangements should be flexible enough for institutions to recover the reasonable costs of delivering mission-specific specialised programs. We would have no problems if in return for such flexibility, institutions were required to meet higher standards of transparency over the use of funds and accountability for delivering promised standards of tuition.

Sixth, we discuss some of the other key challenges that the University faces, which we suggest support the case for the need to move on from the current normative funding arrangements. These include issues in the areas of: workplace learning; sustaining and measuring quality; developing and maintaining infrastructure; providing high quality student support services and amenities; and supporting students with special needs. Here, we also summarise the key issues raised in the appended faculty submissions, as well as some of the key challenges facing disciplines that we have not addressed elsewhere.

Finally, we conclude by setting out the University’s vision for the future, and stressing our overarching hope that the Review will provide the Government with a compelling case for the shift to be made to a new base funding framework, which is based on a clear understanding of the actual costs of sustaining high quality education in different disciplines and settings. We provide some closing thoughts for consideration and discussion about the possible design and implementation of a framework that is tailored to meet agreed goals for the future of the Australian higher education sector.

3. Defining key terms and objectives

For the purposes of this submission, we define ‘base funding’ to mean the combination of Commonwealth and domestic student financial contributions made in a given year, to an eligible higher education provider, for the purpose of supporting the contribution the provider makes to the achievement of the objectives for the Australian higher education system set out in the Higher Education Support Act 2003 (Cth).

It is important to note that while neither HESA nor the relevant supporting guidelines define base funding, nor state the purpose of Commonwealth Grant Scheme (CGS) funding, or student Higher Education Contribution Scheme (HECS) contributions, both elements of base funding are entrenched in HESA. It is reasonable therefore to presume that both schemes exist to support the overall objectives of the Act.

Here we note that Section 2-1 of HESA defines the objects of the Act broadly to include supporting a higher education system that is: ‘characterised by quality, diversity and equity of access; contributes to the development of cultural and intellectual life in Australia; and is appropriate to meet Australia’s social and economic needs for a highly educated and skilled population’. The Act seeks also to support the distinctive purposes of universities as independent and autonomous institutions, to ‘strengthen Australia’s knowledge base; enhance the contribution of Australia’s research capabilities to national economic development, international competitiveness and the attainment of social goals; and to support students undertaking higher education and certain vocational education and training’.

We particularly note the acceptance of the broad ways by which universities contribute to the economy and society in the objectives of HESA. Unfortunately, in our view, recent approaches to the design and implementation of policy relevant to the higher education sector have too often been characterised by instrumentalism – underestimating the complexities and interdependencies of operating large modern universities.

We therefore urge the Review Panel to take a holistic view of the education, research, knowledge transfer and community engagement functions of universities, and in particular to consider how and where base funding fits in the broader context of the various other funding sources that together sustain the Australian higher education sector.

4. A changing operating environment

Base funding is currently calculated according to the number of Commonwealth Supported Places (CSPs) which the Australian Government agrees to allocate to a provider for a given year in each of eight discipline-based funding clusters. From 2012 onwards, in order to expand participation in higher education, the current caps on CSPs will be lifted in most disciplines, with the existing funding safety net for providers removed. 2

One of the most positive reforms that the current Government has achieved for the sector is the improvements to the indexation of all commonwealth grant scheme and student contributions levels that will start to apply in full from 2012.3 Over time this single measure should do much to maintain the quality and sustainability of the sector. Nevertheless, improved indexation is of little consequence if the funding amounts that are being indexed are not aligned with the actual costs of delivering an educational experience of an appropriate standard.

While the system has always been effectively driven by student demand, the Government has been able to manage the cost of its share of base funding by limiting the supply of CSP places. It has also been able to partly insulate providers from the financial impact of dramatic declines in demand by maintaining a year-on-year Commonwealth Grant Scheme (CGS) funding floor.

From 2012, the operating environment will be different in three fundamental ways. First, if the Government maintains its commitment to support every eligible student offered a place in particular disciplines, it will face difficulties controlling the costs of its contribution to base funding. This has obvious consequences for the capacity of the Government to increase its level of support per CSP student in a tight budgetary environment. Second, the lifting of the annual total CGS funding floor for providers will mean that institutions and disciplines that rely primarily on base funding to sustain their activities will only remain viable if enrolment levels are maintained, or by meeting the funding shortfalls with income earned from other sources. Third, if the Tertiary Education Quality and Standards Agency (TEQSA) legislation is passed by the Parliament, providers will be operating under a dramatically different standards-based regulatory framework.

The shift to the demand-driven funding is likely to have profound implications for the Government and providers, but also for staff and students. It will force all providers to consider the viability of their course offerings, and make strategic decisions about those areas that they will keep or discontinue. If revenues from international students and other sources decline, as is widely expected in the short term at least, this will place further pressure on providers to reassess the viability of many of their programs. In areas where demand remains high from domestic and international students, and where base funding is considered inadequate, institutions will face difficult choices about which students to admit.

5. Time to move on from the Relative Funding Model

As the Review Panel’s background paper notes, the current Commonwealth Grant Scheme (CGS) funding clusters have their origins in the Relative Funding Model (RFM) released in 1990 by the former Department of Employment, Education and Training (DEET). The RFM was only ever intended to facilitate the transition to the national unified system in the early 1990s, in a way that achieved funding transparency and equity between institutions within an available funding envelope.

The model may have served these purposes, but it has posed challenges for the sector ever since. It was never based on an understanding of actual disciplinary costs, or of the level of funding required to provide programs at particular standards in different disciplines. Rather, it was informed by an analysis of historically-based patterns

2 Commonwealth Treasury, Budget Paper No.2 2009-2010, p.144 3 Commonwealth Treasury, Budget Paper No.2 2009-2010, p.143

6 of funding provided to different types of institutions, adjusted for a range of reasons that were considered appropriate at the time.

For the past 20 years incremental adjustments have been made to the funding clusters, loadings and student contribution amounts to address perceived weaknesses and anomalies, while the nature of educational delivery and associated costs have changed dramatically – not least because of the advent of the computer age. The irrationality and inconsistency of the cluster funding arrangements has led to the complex web of cross- subsidisation that is a feature of Australia’s university system today, while the imminent shift to a standards- based approach to regulation is making the historical focus on cost relativities between disciplines less relevant.

In our view, further tweaking and short-term fixes will not be sufficient to underpin a high quality Australian higher education system in the long term. Our hope is that the Base Funding Review will provide a compelling case for change, combined with a clear path that can be followed over the next two to three years, so that the transition can finally be made to new principles-based funding framework capable of allowing the nation to meet agreed objectives for the future of its higher education sector.

6. Problems with using historical costs data to determine future funding levels

The University has agreed to participate in the Access Economics study, commissioned by the Review Panel, to examine current cost relativities between disciplines and institutions. While we do not wish to labour the point, we feel it is important that we place on the record our concern that such studies, which are by necessity based on historical cost relativities, are of limited value because for most disciplines the cost data produced generally align very closely with the funding the discipline receives. As Access Economics itself concluded in its 2007 costing relativities study conducted for the former Department of Education, Science and Training: ‘institutions attempt to deliver a course of the best quality possible within the funding available. Using the historical amounts spent as the basis for determining future funding simply perpetuates historical relativities (becoming a ‘self-fulfilling prophecy’). However, breaking the nexus of past funding determining the amount spent which in turn determines future funding is highly problematic. Using cost relativities as the primary data source for informing funding relativities fails to break this nexus. Using historical cost relativities to determine future funding relativities must be supplemented by other information on the extent of ‘cutting the cloth’ that has occurred in each discipline. That is, some exogenous information should be incorporated to inform decision making when the cost data at hand is clearly endogenous to the total (student plus government) funding decision.’4 (Access Economic, 2007, p.4)

7. Enduring principles to underpin public investment in higher education (Addresses consultation questions 1.1, 1.2, 1.3, 2.4, 3.8, 5.1, 5.2, 5.3 and 6.3)

In its submission to the Review the Go8 has proposed the following principles to govern the level and distribution of government investment in higher education learning and teaching:

1. Australia’s higher education system should be of international quality 2. A quality higher education system requires adequate funding which should be sustainable 3. Costs must be shared between Government and students 4. Students should have greater choice 5. Funding arrangements should support equity of access 6. Allocation of funding should be as simple as possible, recognising the complexity of contemporary higher education 7. Allocation of funding should be transparent.

4 Access Economics, Higher Education Cost Relativities and Pipeline, March 2007, p.7

The University of Sydney endorses these principles and provides the following comments in support of the adoption of principles such as these.

The terms of reference for the Review ask the Panel to ‘establish enduring principles to underpin public investment in higher education, including the appropriate balance between public and private contributions towards the costs of undergraduate and postgraduate education’. The principles-based approach is most welcome. The issues are complex. The multitude of different interests and perspectives will make it difficult for the Panel to find and navigate a clear path forward. The pressure on the Panel to recommend further ad hoc changes to the current framework to address shortcomings identified in different areas is likely to be intense.

The Government’s budget position, the budgetary implications of the shift to the demand-driven system from 2012, and the make-up of the current Parliament mean that the prospects of achieving any significant increases to either of the core components of base funding in the short-term are likely to be slim. In the absence of a net increase in the overall level of Commonwealth support per student in the short term, however, it is difficult to see how an outcome can be achieved which increases funding rates in some disciplines, without reducing funding in others. The perverse result of such an outcome for some institutions, including this one, could be that we find ourselves having to adjust current internal cross-subsidy arrangements in order to sustain areas that contribute a positive margin under the existing funding framework.

In this context we believe that the Panel can best serve the Government, students, staff and institutions by delivering a report that provides a compelling case in the national interest, for the transition to be made to a new rational and responsive base funding framework at an appropriate point in the future. We suggest the following principles-based approach as one possible way forward for the Panel.

Clarity of purpose

The starting point for developing the enduring principles should be for the Panel to arrive at a clear and simple statement of the purpose of base funding for higher education. The statement should be capable of garnering the support of Government, Parliamentarians, students, staff and higher education providers.

The Go8 has proposed the following statement of purpose for the base funding framework, indeed for all policies that impact on the higher education sector:

Australia’s higher education system should be of international quality.

The statement draws on key conclusions and findings of the Bradley Review in 2008, including:

‘There is an international consensus that the reach, quality and performance of a nation’s higher education system will be the key determinants of its economic and social progress. If we are to maintain our high standard of living, underpinned by a robust democracy and a civil and just society, we need an outstanding, internationally competitive higher education system.

“Australia is falling behind other countries in performance and investment in higher education. Developed and developing countries alike accept there are strong links between their productivity and the proportion of the population with high-level skills. These countries have concluded that they must invest not only to encourage a major increase in the number of population with degree-level qualifications but also to improve the quality of graduates.” (Bradley Review, p.xi)

We support the Go8’s suggested statement of purpose as a starting point for discussion because of its simplicity, and because of the acceptance inherent within it that base funding has a critical role to play in sustaining higher education learning environments at internationally benchmarked levels of quality. That is, the purpose of base funding is to support the underlying fabric of higher education providers, not simply to cover costs directly linked to the provision of teaching a Commonwealth supported student in a particular discipline.

Once consensus has been reached about the fundamental purpose of base funding, the adequacy of the existing arrangements can be assessed objectively. Using the statement of purpose proposed by the Go8 as a starting point, we suggest that the following supporting principles could serve to provide a principles-based framework around which a new rational and responsive base funding model could be built.

The University of Sydney, suggested enduring principles to support the design of a new base funding framework for the Australian higher education sector

Purpose: The purpose of base funding is to ensure that Australia has a higher education system that is of international quality

Supporting principles

1. Sufficiency The level of base funding, combined with other funding sources that support agreed core education and research activities, should be sufficient to sustain Australia’s higher education sector at a level of quality that is internationally competitive.

2. Transparency The activities covered by base funding should be clear and determined transparently. Allowable costs should include agreed teaching costs, student support service and amenities costs, infrastructure reinvestment costs, and the costs of supporting research and scholarship.

3. Cover actual costs The total base funding rate for each discipline should cover the agreed actual costs of delivering and sustaining agreed minimum standards of education in the discipline at the undergraduate or postgraduate level as relevant. Ideally, the assessment of costs should be undertaken by a statutory body that is independent of the Government and providers.

4. Efficiency and quality The base funding and broader regulatory framework should work together to encourage providers to constrain costs and enhance quality, but should do this in a way that recognises the universities as independent and autonomous entities.

5. Flexibility and diversity If a provider has higher costs for legitimate reasons, or wishes to provide an educational experience and/or graduate outcome above the agreed minimum set by TEQSA, it should be able to provide evidence in support of its claims, and recover reasonable higher costs through base funding. Students should be free to decide whether they are willing to pay more in return for a different learning experience.

6. Fairness The Government and student contributions to base funding should be determined transparently, and reflect the relative public and private benefits of a student completing a particular course of study.

7. Access based on merit There should be no upfront financial barriers to participating in higher education while studying, including student living costs.

8. Accountability for quality In return for the ability to recover actual costs, providers should be held accountable for delivering the promised student experience. Accountability for quality should be enforced by TEQSA, the Compact process and public reporting of the institution’s performance. Robust independent information should be available publicly about the overall quality of the institution and the standards of its teaching and research in each discipline.

9. Simplicity The allocation of funding should be as simple as possible.

10. Responsiveness The funding framework should include a process that enables providers to adjust their fees over time, in response to reasonable cost increases over and above indexation.

8. Overview of the University’s current circumstances, key issues and challenges 8.1 Comparing 1990 and 2010

One approach we thought could assist the Review Panel to understand the impact that the RFM-based funding arrangements may have had on the sector, was to provide some comparative historical data on key indicators for the University of Sydney. We have chosen 1990 as the base year for the comparison, as it was the first full year of operation following the process of amalgamation that took place as part of the shift to the ‘Unified National System’ in 1988 and 1989. While there have been changes to our internal governance over the years as well as our degree offerings, and some shifting of programs between faculties, we effectively have the same 16 faculties today that we did in 1990. 1990 was also the second year in which the University received fee income for Commonwealth supported student places through the Higher Education Contribution Scheme (HECS), which commenced in 1989.

Appendix 2 provides comparative data at the level of the University for 1990 and 2010 on student enrolments and load by level of study, gender, domestic and international status. It also includes data for 1990 and 2010 on student completions by level of study, academic and general staff load, gender and salary levels, and University- wide student to staff ratios. Summary income and expenditure data are provided for 1992 and 2010, as it was not possible to reconcile the University’s accounts for 1990 or 1991 with those for 2010. Some key indicators from Appendix 2, or derived from its data, are provided in the table below.

The University of Sydney snapshot data 1990 and 2010

Percentage change between Indicator 1990 and 2010 Total student enrolments +76% (27,674 to 48,579) Undergraduate enrolments +46% (22,329 to 32,612) Bachelor +58% (19,875 to 31,316) Other undergraduate -47% (2,454 to 1,296) Postgraduate enrolments +202% (5,448 to 16,447) Masters by coursework +375% (2,070 to 9,835) Masters research +5% (796 to 839) PhD +200% (1,153 to 3,464) Other postgraduate +62% (1,429 to 2,309) Domestic student enrolments +44% (26,558 to 38,227) International student enrolments +769% (1,246 to 10,832) International students as a percentage of total +17.6 percentage points student load (4.5% to 22.1%) Full-time equivalent staff +61% (4,724 to 7,585) FTE Academic staff +79% (1,886 to 3,371) FTE General staff +48% (2,837 to 4,214) Student to staff ratio +4.8 students (11.9 to 16.7) Student fee income (including HECs and full +20.1 percentage points (from fees, domestic and international) as a share of 13.3% to 33.4%) total income Total income (T&L, Research, Other) +229% ($457.5 million to $1.5 (1992 & 2010) billion) Employee costs as a share of total -10.8 percentage points expenditure (72% to 61.35%) Total expenditure (1992 & 2010) +217% ($438 million to $1.387 billion) See Appendix 2 for more detailed data.

The data allow us to provide an overview of some of the significant changes that have occurred at the University over the twenty years that the RFM-based funding arrangements have been in place. We argue that these

10 changes are at least partly a result of the shift to normative base funding arrangements, though a variety of other factors have undoubtedly also contributed.

8.1.1 The University in 1990

In 1990 the University had a total of 27,674 enrolled students. 95.5 per cent (26,558) of these were Australians, with less than five per cent drawn from overseas (1,246 students). Some 80.4 percent of our students were studying undergraduate courses, with less than a fifth enrolled in postgraduate research or coursework programs. At the postgraduate level, PhD students represented 21 per cent of all students, with Masters by Coursework students accounting for 38 per cent. The remainder comprised Masters Research students and students studying for other postgraduate qualifications, such as graduate diplomas and certificates. In 1990 only 72 students completed their PhD studies at the University, representing just 1.3 per cent of total completions in that year. The University employed some 4,724 full time equivalent staff, split 40/60 per cent Academic to General and 56/44 percent male to female. Its average student to staff ratio across all faculties was 11.9 to 1. The University’s total income in 1992 was $457.3 million, with 13 per cent derived from student fee income, while employee costs represented 72 per cent of its total expenditures of $438.1 million.

8.1.2 The University in 2010

By 2010 the University’s financial, staff and student profile had changed significantly. Its total revenues and expenditures had increased to $1.5 billion and $1.387 billion respectively. The University has more than tripled in size financially since 1992. The amount of income the University derived from student fees (HECS, domestic fee paying and international students) had grown to $502 million, representing some 33.4 per cent of total income received by the University in 2010. During the period the University’s revenues also increased significantly as a result of substantial increases in funding from the Commonwealth, particularly to support research and other specific purposes. Nevertheless, the share of overall income received from the Commonwealth fell from 53 per cent in 1992 to 43 per cent in 2010. Income from donations, bequests and investments also increased significantly over this period. One source of income that changed little over the twenty years was that received directly from the NSW Government. Income from this source represented 3.2 per cent of revenues in 1990, but 1 per cent by 2010. University-wide the student to staff ratio had increased 4.8 students per staff member to 16.7 to 1. Total full time staff numbers had increased 61 per cent to 7,584 split 44.5/55.5 Academic to General staff and 46/54 per cent male to female. In 2010 expenses attributable to employees accounted for 61.15 per cent of the total, down 10.8 percentage points since 1992.

In 2010 some 562 students completed PhD studies, up 490 students and 681 per cent on the 1990 level. This represented 4.2 per cent of all completions in 2010, compared to 1.3 per cent in 1990. Some 3,464 students were enrolled in PhD programs, up 200 per cent on 1990, but still representing around 20 per cent of all postgraduate enrolments because of the particularly strong growth that occurred in Masters by Coursework enrolments. In 2010 the University had some 9,835 students enrolled in Masters Coursework programs, up 375 per cent on the 1990 figure, accounting for just under 60 per cent of all postgraduate enrolments, compared to 38 per cent in 1990. By 2010 the proportion of students studying at the undergraduate level had declined 13.9 points to 66.5 per cent, largely as a result of the strong growth in postgraduate coursework and PhD enrolments. Notably, there was very modest growth in Research Masters enrolments between 1990 and 2010 (5 per cent), suggesting a student, employer and perhaps institutional preference for coursework or PhD options.

In 2010 the University enrolled 10,832 international students, which corresponded to 22.1 per cent of its total student load. This represented an increase of 17.6 percentage points from the 4.5 per cent in 1990. Over the twenty years 1990 to 2010, the University recorded 644 and 980 per cent increases from relatively low bases in international student enrolments in undergraduate and postgraduate programs respectively. This compared to 24 per cent increases for domestic students at the undergraduate level and 129 per cent for postgraduate programs. The University experienced much stronger growth over the twenty years in postgraduate programs compared to undergraduate programs, with enrolments at the postgraduate level increasing some 200 per cent compared to 46 per cent for undergraduate programs. In fact, all growth in enrolments at the undergraduate level was due to a 56 per cent increase in enrolments in bachelor degree programs over the twenty years. There was a decline of 47 per cent in enrolments in all other undergraduate programs over the period.

8.2 The factors that have contributed to the trends

A range of factors have contributed to the trends described above. It would be disingenuous to suggest that the base funding arrangements that have been in place since 1990 were the sole contributing factor. Other factors include:

• strategic positioning of the University as a global institution with the mission of producing graduates to be global citizens, and of conducting research of global quality and significance • escalating cost pressures as a result of the indexation arrangements applied to the sector from 1995 until 2011 • increasing domestic demand for postgraduate coursework qualifications in some disciplines • changes in employer demand for graduates with postgraduate qualifications • a shift to postgraduate level qualifications as the standard pathway entry into many professions • the willingness of the Commonwealth to shift CSP load to postgraduate programs in some disciplines in recognition of changing employer demands • the introduction of student loan schemes for postgraduate full fee programs • the economic rise of Asia , particularly in some key countries • Commonwealth marketing, and, until recently, migration strategies that have actively promoted study in Australia • improvements in the availability and affordability of international air travel to and from Australia • Commonwealth programs that have supported and encouraged growth in higher degree by research student numbers and completions • the constant challenge of sustaining the University’s research effort at internationally competitive levels in an environment where funding has not covered the full costs of research and research training.

Nevertheless, we believe that the base funding framework has been an important contributing factor and that the comparative data presented above point to shortfalls in the level of funding in some disciplines. All things being equal, if the base funding received by the University was adequate to sustain a learning environment considered to be of an appropriate international standard in all disciplines, the University is unlikely to have gone to the lengths it has to grow alternative sources of income.

As noted above, between 1990 and 2010 the University’s total staff numbers have grown by 61 per cent overall, compared to growth in student enrolments of 77 per cent over the same period, while its student to staff ratios increased from 11.9 to 16.7. Core immediate teaching and research activities have also arguably been sustained at the expense of necessary investment in new and existing building and support infrastructure as we discuss below in section 8.5.6. In addition, if the base funding levels were sufficient to sustain appropriate learning environments for all disciplines, the University would not need to cross-subsidise between faculties and disciplines as outlined below.

8.3 How the University manages disciplinary funding shortfalls

The capacity of the University’s 16 faculties to supplement base funding and research income with income from other sources varies greatly. Generally, however, there is a relationship between the operating margins of our faculties, their scale and their capacities to attract domestic and international full fee paying students. The table below provides the student fee (non CSP) income earned in 2009 by each faculty, along with the proportion of total teaching and learning revenue in the faculty that student fee income represented in that year.

Each faculty’s CSP and full fee load figures are also provided to indicate the large variations in scale between the faculties and the numbers of full fee students they attract. The shaded faculties are those faculties that recorded a negative operating margin for the year, and which were effectively supported by a redistribution of income from the unshaded faculties - those that achieved positive margins.

The University of Sydney, Faculty CSP and fee income comparisons 2009

Full fee Fee income as a Total student domestic and percentage of total fee (non CSP) CSP load international Faculty Learning and income 2009 2009 load 2009 Teaching revenue $’000s 2009

Faculty 1 73,161 78.4% 2,276.6 4,830.5 Faculty 2 19,259 34% 5,313 1,640.4 Faculty 3 17,650 16% 1,974.2 1,022.7 Faculty 4 16,340 43% 1,539.6 1,107.7 Faculty 5 15,647 26% 3,755.1 1,081.5 Faculty 6 12,088 63% 859.8 823.1 Faculty 7 11,874 32% 2,406.4 827.8 Faculty 8 6,082 34% 445.3 277.3 Faculty 9 6,011 52% 586.6 485 Faculty 10 4,201 38% 598.9 225.6 Faculty 11 4,047 22% 1,413.8 479.6 Faculty 12 3,923 41% 260.4 180.3 Faculty 13 1,894 13% 648.1 151.6 Faculty 14 1,375 17% 466.1 113 Faculty 15 1,160 14% 291.5 91.1 Faculty 16 727 11% 229.8 181.8

8.3.1 Possible adverse impacts on teaching quality

One consequence of the revenue shortfalls we have faced in some faculties, generally where curriculum and teaching requirements are set by external professional accreditation bodies, is that we have needed to find ways to increase our operating margin in other areas where we have greater capacity for flexibility. One result of this pressure is reflected in the trends in student to staff ratios that we have experienced in two of our key generalist degree faculties over the period 1990 to 2010 — the Faculty of Arts and the Faculty of Science. For Arts, in 1990 the official student to staff ratio was 12.9 to 1. By 2000 it had grown to 19.3 and by 2010 it had increased again to 21.5. It is a similar story for the Faculty of Science. In 1990 its overall student to staff ratio was 12.5. By 2000 the ratio had grown to 15.9 and by 2010 it had reached 22.2.

The University of Sydney student to staff ratio trends Faculty of Arts and Science 1990 to 2010 Student to staff ratios 1990 to 2010

Faculty of Arts Faculty of Science

22.5 15.9 12.5 19.3 21.5 12.9

1990 2000 2010

Despite the significant increases in the student to staff ratios in these two large generalist faculties, between 2001 and 2009, there does not appear to have been a discernible decline in the proportion of student who express satisfaction with various aspects of their learning experience as measured by our bi-annual Student Course Experience Questionnaire (SCEQ).5 Nevertheless, we are concerned by the trends and would certainly seek to address them if the overall funding environment was less constrained. Further, and we think importantly, we note that the falls experienced by most Australian universities in the 2010 QS World University Rankings have been attributed to the rising student to staff ratios of many Australian institutions, with this measure one of six factors feeding into these important rankings.6

A further indication of possible challenges to the quality of educational offerings is the increasing trend towards the reliance on casual staff for teaching in some faculties, but particularly in our generalist disciplines. The figure below shows the increases in the number of teaching hours undertaken by casual and part-time staff in the Faculty of Arts from 2006 to 2011, alongside the increases in student load in the faculty. Over this period full-time equivalent student load in the faculty increased by 62 per cent from 5,148 in 2006 to 8,338, while casual and part-time teaching hours increased by 54 per cent. We recognise that these data do not tell the full story, but complexities in the way that we collect other relevant data, mean that this is the best indication we can provide, in the time available, of the increasing trend towards casualisation in response to financial pressures.

The University of Sydney, Faculty of Arts casual and part-time teaching hour trends 2006 - 2011

Faculty of Arts Converted Casual Part-Time Teaching Hours and Student Load 2006 - 2011

50,000 45,000 38,703 40,000 37,832 35,711 35,000 31,094 30,000 23,952 25,000 24,409 20,000 15,000 8,338 7,312 7,765 10,000 6,761 5,148 5,474 Casual PT Teach Hours 5,000

- Student Load 2006 2007 2008 2009 2010 2011

We provide this information in order to demonstrate to the Panel that while disciplinary cost relativity data might indicate that the levels of funding for some disciplines are appropriate, or even more than sufficient, the cost data alone tell only part of the story. In our generalist degrees, in which we enrol many thousands of students, we have had more flexibility compared to other areas to increase the margins between income and costs, while always doing so in ways that ensure that standards remain academically appropriate.

There is a limit, however, to the extent to which such strategies can be pursued before quality is impacted adversely. We may be approaching that point, even though our student survey data remain positive about our overall performance. Our central claim here is that cutting current funding from some funding clusters

5Student Course Experience Questionnaire http://www.itl.usyd.edu.au/sceq/facultytables.htm 6 https://www.owa.usyd.edu.au/Exchange/

14 within a fixed envelope – especially the humanities, social sciences and natural sciences – and diverting the saved funds to other areas simply shift the problem of underfunding as opposed to addressing it seriously.

Indeed, given these faculties provide much of the cross-subsidy for other core faculties, cutting funding for these clusters not only puts downward pressure on teaching quality, but also reduces the cross-subsidy capacity, thus having significant flow on effects for other faculties.

8.3.2 The success of full fee provision through our Summer School

In addition to experiencing strong growth over the period 1990 to 2010 in enrolments and income from postgraduate coursework programs and from international students at both the undergraduate and postgraduate levels, we continue to experience steady demand from domestic and international students to undertake units of study in our Summer and Winter School programs.7 We believe that the success of the Summer School demonstrates the level of demand from students, including domestic undergraduates, from a variety of backgrounds who are keen to complete units during Semester breaks on a full fee paying basis for a variety of reasons. The tables below show trends in enrolments and fee income earned from the Summer School in recent years. While as proportion of the University’s overall teaching load and budget the Summer School is a relatively small program, we thought it useful to include information about it as an example of the types of strategies the University has pursued, partly in response to the base funding framework, in order to diversify its revenue streams, utilise its resources during typically quiet periods on campus, and provide more flexible study options in response to the needs of students.

The University of Sydney, Summer School, Enrolments by Type of Student 2003-2011

International Local Total UG PG Total UG PG Total 2003 1224 614 1838 1542 395 1937 3773 2004 1276 872 2148 1478 523 2001 4149 2005 1323 779 2102 1114 559 1673 3775 2006 1246 708 1954 1047 438 1485 3439 2007 1141 779 1920 1240 397 1637 3557 2008 1007 975 1982 1316 394 1710 3692 2009 1043 996 2039 1326 454 1780 3819 2010 1216 822 2038 1391 530 1921 3959 2011 1354 591 1945 1369 430 1799 3744

The University of Sydney, Gross Fees by Revenue Type for Summer School 2009-11

2009 2010 2011 Total Fee paying $ 9,034,167 $ 9,294,165 $ 9,675,425 Total Fee HELP $ 1,867,050 $ 2,556,210 $2,893,590 Total HECS-EQUITY $ 8,440 $ 19,857 $4,629 Total Fee waivers $ 49,530 $ 30,210 $24,870 (scholarships) Total $10,959,187 $11,900,442 $12,598,514

8.4 The University Economic Model

The University is currently in the process of implementing a new University Economic Model (UEM). 2011 is a transition year, with the model to be implemented fully from 2012 onwards. The UEM operates on the basis that academic units are the key revenue generators for the University and that both resources and costs

7 http://sydney.edu.au/summer/

15 should be transparently allocated to them. It therefore begins with a commitment to returning to an academic unit (a division, faculty or school), 100 per cent of the income that the unit generates, less the direct costs that it incurs and a number of levies. Surplus income remains, in principle, available to the division, faculty or school. The levies address six areas and are calculated on the basis of varying related cost drivers. They include the following: • charges for University-wide services (including finance, human resources and ICT) • charges for the use of space based upon the costs of maintaining the relevant type of space • a charge for University-wide academic programs where the funding is redistributed to faculties to support strategic activities, including scholarships • a charge to provide capital funds to meet with the University’s ever-increasing demands for digital and physical infrastructure renewal • the redistribution of revenues to support the research-intensive parts of the University on the basis of research performance • a five-year transitional phase levy to cross-subsidise those faculties where income is inadequate to meet their operations (there will be some areas where a sustained cross-subsidy will be merited and maintained on academic grounds).

In this way incentives are maximised to increase income and reduce costs. With the resulting greater transparency at the faculty, divisional and University-wide levels, individual academic and service units will be able to understand more openly where the University’s income is earned and where it is spent, and make decisions about our resources to maximise academic returns. The two diagrams in Appendix 3 provide more detail about the operation of the UEM and explain how it contributes fundamentally to the achievement of the University’s strategic plan. We expect that we will provide Access Economics with more detail about the UEM as part of its study of current costing relativities, and would be happy to arrange a separate briefing for the Review Panel and its secretariat if that would be helpful.

8.5 Key current challenges

8.5.1 The relationship between education and research (Addresses consultation questions 3.1, 3.2, 3.5 and 3.6)

The Review’s Consultation Paper suggests that the concept of ‘scholarship’ is accepted as an essential element of funding for higher education teaching, but raises questions about the extent to which research activity should continue to be supported by base funding. The paper provides two reasons for the acceptance of scholarship as appropriate activity to be supported from base funding. First, that such an interpretation is consistent with requirements of the National Protocols, which require academic staff to be active in scholarship in order to inform their teaching. Second, the fact that Department of Innovation, Industry, Science and Research (DIISR) does not provide funding support for scholarship activity undertaken to support teaching, is taken to mean that it must be covered by base funding.8 Furthermore, issues relating to the direct funding of research are said to fall outside the scope of the Review, presumably because of the terms of reference and the fact that principal policy and funding responsibility for higher education research now rests with a separate government department.

We have no issue with scholarship activities being viewed as an acceptable component of base funding. This is simply essential. However, the implication that it may no longer be appropriate for general university funds (which include base funding) to support under or un-funded research and research training activities, is of significant concern. While scholarship is important, it does not inform teaching and update knowledge in the field in the same way that, for example, the participation in international research conferences allows. Research activity of this type not only provides the most up-to-date developments in the discipline, but facilitates the transfer of knowledge to students studying subjects at the cutting-edge, ensuring that they have an awareness that the understanding of the subject is constantly changing.

It is certainly the case that the University of Sydney, like most, if not all Australian universities, continues to rely on discretionary funds to support its research mission. Due to the overlaps and interdependencies between teaching and research, and the continuing shortfalls we face in research funding, we believe it is appropriate, and at present a necessity, that we are able to use a proportion of our discretionary revenues to

8 DEEWR, Base Funding Review, Consultation Paper, December 2010, p.8

16 support our research activities. We therefore provide the information below in the hope that the Review will take a holistic rather than an instrumental approach to the relationship between funding for teaching and research in the Australian higher education system.

We also note that the issue of the extent to which base funding should be allowed to be used to support research should be of great relevance to more teaching-focused, as well as more research-intensive institutions. This is because smaller institutions are likely to be even more reliant on base funding to support their research efforts in order to meet the research requirements of the National Protocols. Certainly, our understanding is that due to economies of scale and other issues, the DIISR transparent costing exercise undertaken as part of the development of the funding framework for the Sustainable Research Excellence (SRE) program, generally found that smaller institutions had higher indirect research costs than their larger counterparts.

Engaged enquiry

In the White Paper that accompanied the University’s Strategic Plan 2011–15 we set out our vision for a University where all that we do is underpinned by two values - ‘engaged enquiry’ and ‘mutual accountability’. These two key themes run through all of the strategies that we are currently pursuing. The value of mutual accountability underpins our approach to planning, decision-making and the allocation of resources. It is not of direct relevance to the Base Funding Review, except that it is through this process that we make decisions about the internal allocation of resources and costs. The notion of engaged enquiry is, however, highly relevant to the Review as it goes to the questions of the relationships between teaching, scholarship and research, as well as the type of learning environment and experiences available to students.

By engaged enquiry we mean that the University is foremost a place in which ideas, both new and old, are learned, tested, challenged and modified. Our notion of engaged enquiry holds together the work of the various academic disciplines, but we are also committed to bringing disciplines together to solve complex problems through collaboration. Engaged enquiry also holds together the work of the University and the life of the various communities – local, national and international – of which it is part. We believe that our teaching and research should address, and be informed by, the questions that our communities are facing.

Our vision for the University seeks to unite researchers and students at all levels in a common task. In pursuit of engaged enquiry, we strive for seamlessness in the learning of our students and our researchers as they sharpen their skills for the purpose of advancing knowledge and understanding. We seek to embed discovery- based learning in all curricula, and to provide students with opportunities for research enriched experiences appropriate to the discipline and level of study.9 In so doing we introduce students to research and research methodology early in their studies, seek to identify students with an interest in and capacity for research, and provide clear pathways by which they can pursue their passions. We also seek to provide coordinated faculty, divisional and University-wide programs for researcher induction, and for research training, mentoring and professional development at all career stages.

There is an assumption inherent in our approach that all of our academic staff are research active, even if they do not hold research grants, take time during the course of their career to focus on their teaching, or the subject of their research becomes the pedagogy of their discipline, rather than the discipline itself. Our approach reflects the fact that the funding councils only support a very small proportion of academic staff and research undertaken across Australia, and acknowledge openly that most high quality research goes unfunded every year. This is why, in our Enterprise Agreements we have consistently committed to ensuring that for staff classified as ‘Teaching and Research’, the total amount of teaching and related activities will not exceed 40 per cent of their total workload over a twelve month period, unless otherwise agreed by the staff member and his or her supervisor. We expect these staff to spend the remaining 60 per cent of their time on research and scholarship (40 per cent) and professional engagement, community engagement and administration (20 per cent).10

Our approach to research is also driven by other factors. One development that has gained significance over the last decade is the increasing power and importance of international rankings of universities. Despite their various flaws, rankings are here to stay as part of the operating environment. Whether we like them or not, they are influencing the perceptions of governments and the public about the relative standing of countries and institutions, and informing the decisions of potential students, employees and collaborators. The heavy reliance

9 http://www.itl.usyd.edu.au/projects/relt/framework.htm 10 The University of Sydney Enterprise Agreement 2009-2012, Clauses 211 and 230.

17 of the various ranking systems on research performance, as assessed by various metrics, means that any University that aspires to be internationally competitive, and to be recognised widely as such, must ensure that it provides its staff and research students with the resources and support required to maximise the quality and impact of their research. With only a proportion of the University’s research effort funded from external sources, and then invariably underfunded, it stands to reason that like leading universities globally, we have sought to grow our discretionary sources of income in order to support our integrated teaching and research missions.

8.5.2 The costs of supporting research (Addresses consultation questions 3.1. 3.2, 3.5 and 3.6)

The Review provides an opportunity to remove the ambiguity that has existed in the funding of higher education research since the Higher Education Support Act HESA 2003 (Cth) replaced the former Higher Education Funding Act 1988 (Cth). A feature of the former Act was that the various grants made to institutions were designated as being for ‘operating purposes’ and ‘limited operating purposes’. Grants classified as for ‘operating purposes’ could be used by an institution to meet the costs associated with any activity considered necessary to support its general teaching or research purposes. For teaching, this included costs arising in connection with ‘courses of study provided by or at the institution, including preparatory work in connection with proposed courses of study to be provided by or at the institution’. For research, this covered costs associated with ‘the general research purposes of the institution’.11 Grants provided for limited operating purposes could only be used to support general teaching purposes, or to purchase equipment or pay for minor infrastructure projects required to support its teaching activities.

When HESA replaced the HEFA from 2003, payments to institutions were no longer made directly under the Act, but through new Commonwealth Grant Scheme (CGS) Guidelines for teaching and through Other Grants Guidelines for research and various other purposes. Following the 2008 transfer of responsibility for the ‘Science’ functions of the former Department of Education, Science and Training to the Department of Innovation, Industry, Science and Research (DIISR), all grants for Research under HESA are now made under the Other Grants Guidelines (Research) 2010.

The DIISR guidelines covering its various research funding schemes are very clear about the purpose of each scheme and the degree of discretion that institutions have over the use of each source of funds. This is not the case for the CGS guidelines. No overall purpose is apparent for the CGS, either within HESA or in the guidelines. Similarly, the purpose statements in the guidelines covering individual components of the program give no indication of their objectives, or of the uses to which the funding may be put. The only guidance that appears to be publicly available on the purpose of the CGS scheme is the following statement on the Department’s websites:

‘The CGS supports the provision of undergraduate and some non-research postgraduate higher education places. The Commonwealth provides funding to eligible providers for an agreed number of Commonwealth supported places in a given year. To receive CGS funding, a provider must enter into a funding agreement with the Commonwealth.’12

With the introduction of HESA, it may have been the former Government’s intention to move from the former ‘operating grant’ system to one where funding for higher education teaching and research activities was provided from distinct funding pools, with an expectation that the funds would be used only in connection with each type of activity. If this was the intention, however, it was not made clear at the time, or in the legislation. Moreover, the changes were not informed by any analysis of the actual costs of delivering teaching and research to appropriate standards in different disciplines. Furthermore, until the 2010-11 Commonwealth Budget, Department of Education Science Training (DEST) itself and subsequently DIISR continued to publicly report the estimated cross subsidy to research sourced by universities from the Australian Government, other than through specific purpose research and research training programs – in other words from the CGS scheme.

From 2003-4 to 2009-10, according to the Government’s own Science and Innovation budget tables, the estimated cross-subsidy from the CGS to research grew from $437 million sector-wide, to $650 million.

11 Higher Education Funding Act 1988 (Cth) Clauses 3, 15,16 & 18. 12 http://www.deewr.gov.au/HigherEducation/Programs/Funding/CommonwealthGrantScheme/Pages/Home.aspx

However, DIISR did not include the estimate for the 2010-11 budget for the first time and removed the estimate for 2004-5 onwards, providing the following explanation:

‘Following the 2002 Review of Higher Education, the Australian Government announced a package of new higher education policies, to be implemented between 2004 and 2008. The legislation to give effect to the reform package, the Higher Education Support Act 2003 (HESA), was passed by Parliament on 5 December 2003. As a result, this estimate is no longer consistent with the implementation of the new funding arrangements for higher education institutions under the provisions of the HESA and has not been included from 2004-05 onwards.’13

Nevertheless, as the Review’s supporting papers both note, universities continue to rely heavily on income from general university funds to support their research activities. Using the data the University provided to the ABS for its 2008 Higher Education Research and Development (HERD) survey, we estimate that for every dollar of discretionary income the University earned in that year, some 33 cents was used to support either direct or indirect research costs. In 2008 the University’s total base funding (CGS and HECS-HELP) was $317.8 million, meaning that the estimated cross-subsidy to research was $105 million. We have provided an explanation of the data and methodology used to arrive at this estimate in Appendix 4. While we acknowledge that the estimate may be overstated due to some of the assumptions used by the ABS, we trust that it indicates the significance of the issue, even if discounted to some degree.

We expect that the Sustainable Research Excellence (SRE) initiative will assist us to meet more of the indirect costs of some of our externally funded research. However, even when it reaches its full capacity, SRE is intended to meet only a proportion of the acknowledged indirect costs of supporting Australian Competitive Grant schemes programs funded by the Australian Government. The SRE funding model still assumes that the remainder of the indirect costs for this research, some or most of the indirect costs for research funded from other external sources, and all indirect costs for unfunded research, will be met by institutions from other sources. With the funding councils seeking increasingly to maintain grant success rates above certain levels, for example, by reducing grant funding and placing ever tighter restrictions on the use of funds, we envisage overall pressures on our research budget increasing rather than decreasing over the next three to five years.

Other changes, often announced without consultation with the sector, may also have unintended consequences. For example, at the same time that the Government announced it would introduce the SRE, it also announced that the former Institutional Grant Scheme (IGS) would be renamed the Joint Research Engagement Scheme (JRES) in order to encourage institutions to pursue more research income from industry and other sources. While that may be a worthy objective, the performance of institutions in nationally competitive grant scheme programs was cut from the list of research income sources that would drive JRES funding. The IGS/JRES is the one significant research block grant for which institutions have broad discretion over how funds may be applied. In many cases, under IGS, the funds were used to support all or some of the salary costs of the chief investigators holding nationally competitive project grants, which cannot themselves be used to cover these costs. As a result of this change, the link has been broken between the nationally competitive grant program and a key source of block funding that has been used to support direct research costs that are explicitly excluded from the grant. If the University is unable to maintain JRES income at IGS levels, further pressure will emerge to support these costs from other sources of discretionary income. In turn, this will place pressure on our capacity to sustain the quality of our educational offerings.

Given that universities continue to rely heavily on their general funds to support their research missions, we feel that it is critical that, notwithstanding the focus on teaching issues, the Review does address the issue of the appropriate relationship between the funding provided for teaching and that provided for the minimum level of research required to inform that teaching at an internationally competitive level. As we argue below, we believe that any new base funding framework should include a clear statement of the activities that the funding is provided to support, with research included as one of the key elements for the pedagogical and historical reasons outlined above. If research is not an allowable element of base funding, then very careful thought will need to be given about how to make the transition to a funding model where such costs are excluded, without doing significant damage to the nation’s research capacity.

13 DIISR, Science and Innovation Budget Tables 2010-11, Table 4: http://www.innovation.gov.au/AboutUs/FinancialInformationandLegislation/BudgetInformation/Documents/ScienceResear chandInnovationBudgetTables2010-11.pdf

8.5.3 Preparing the next generation of researchers (Addresses consultation questions 3.1 and 3.2)

A core part of the University’s mission is preparing the next generation of leaders for the Australian and global research workforce. We currently offer doctoral programs in some 137 disciplines, have around 4,000 students enrolled in our PhD and Master by research programs and graduate around 700 PhD students annually. Our graduates make a major contribution to the economy and society more broadly by renewing the academic workforce, or increasingly, by pursuing careers in government, the private or not-for-profit sectors in Australia or overseas. Two manifestations of our pursuit of this mission are the effort and resources we dedicate to providing undergraduate students with exposure to research early in their studies (discussed briefly above), and through the provision of outstanding research training and supervision for those students who choose to undertake a research-focused Honours year of study.

To give the Review Panel an understanding of the costs involved in providing these experiences we have estimated below the additional cost per student incurred by our Faculty of Science annually in offering the research project part of its Talented Student Program (TSP) from first year as well as Honours years in the disciplines of Mathematics and Statistics, Chemistry and Physics. At present the base funding framework does not recognise or cover any additional costs that may be associated with providing specialised educational experiences for any particular group of students within a discipline. This has at least two undesirable consequences. It disadvantages the broader teaching activities of those institutions that have research and research preparation at the core of their missions, compared to those which do not. It also limits the capacity of institutions to offer programs tailored to the needs of students identified as having particular potential to excel at research.

The Faculty of Science Talented Student Program

Through its Talented Student Program, the Faculty of Science provides the most promising students with the opportunity to engage in research from the very beginning of their undergraduate courses. Entry into the program is currently restricted to students with an ATAR above 99. The aim of the TSP is to offer students of exceptional promise additional challenging material from their first year in order to enable them to maximise their intellectual growth and potential. A major benefit of participation in the TSP program is that students receive special individual supervision by academic staff and often engage in studies with small numbers of fellow students, all of whom have a shared interest in the subject. There are four main aspects of a student’s involvement in the TSP. First, they have greater flexibility in their choice of study (beyond that normally allowed by degree rules). Second, TSP students have a personal full-time member of academic staff as mentor from the start of their studies. The mentor assists them in choosing from the great range of academic and research options and then supports them throughout their studies. Third, TSP students have the opportunity to undertake research projects of interest to them, under the supervision of a research active member of staff. Finally, upon completion of their studies students’ academic transcripts indicate that they were selected for and took part in the TSP.

The success of this program is demonstrated by the quality and impact of the graduates.14 Making this level of tuition available to undergraduate students depends on two factors. First, all of the participating staff must be research active and in a position to provide stimulating research supervision and projects. Second, we must have access to resources to cover the additional costs involved in providing this level of research engaged teaching. We estimate that it currently costs the University $1,745 per year per student over and above base funding and full-fee income received, to cover the costs of allowing TSP students to undertake individual research projects as part of their undergraduate studies. A summary sheet detailing the methodology used to arrive at this estimate is included in Appendix 5. We would be happy to provide more detail if that would be helpful. While demand for the TSP program is high and we would like to expand the numbers of students enrolled in the program significantly, or even provide similar opportunities to all of our science students, the current base funding arrangement restricts our capacity to do this.

14 For example, people such as Brian Gaensler (Fed Fellow, Laureate Fellow, Young Australian of the Year, Head of an ARC Centre of Excellence, and a leader in Australia’s bid for the Square Kilometre Array), Tim Schmidt (A/Professor, Koblenz Award winner), are two TSP alumni who have gone on to academic and leadership positions.

The additional costs of the undergraduate Honours research year

The supervision and teaching of undergraduate Honours students in all disciplines is demanding, professionally and financially. This is because of the higher intensity of the teaching context—regular one- on-one engagement, formal seminars and small group tuition—and because research in many disciplines is articulated by long papers, culminating in a major thesis, which require detailed discussion, review and input from supervisory staff and others. For example, in the humanities and social sciences, Honours seminars, of which students must take two or three, require an average of 6,000 words of written work. The average length of a thesis in the Faculty of Arts and Social Sciences is 17,000 words. All theses in social science disciplines at the University of Sydney are between 18,000 and 20,000 words, as are those in History, which has the largest Honours program. Reading and commenting on multiple drafts of this advanced work and assessing the finished products requires much staff time. Each Honours project must be formulated individually, and advising the student through the processes of conceptualisation and planning can be as demanding as providing feedback as the work takes shape. Supervisors typically meet with each student weekly or fortnightly throughout the year and spend much more time reading and providing feedback on their students’ work. Furthermore, Honours teaching and supervision are never entrusted to casual academic staff.

By way of example of the costs incurred by the University in providing high standard Honours opportunities, we estimate that in 2010 it cost us an average of $8,240 per student more than base funding and full fee income received to support our Honours programs in the disciplines of Mathematics and Statistics, Physics and Chemistry. This meant that across these three disciplines alone the Faculty of Science incurred losses of close to $1.2 million supporting its Honours students. The second summary sheet included in Appendix 5 details the methodology used to arrive at these estimates and we would be happy to provide further information as required. We expect that the situation in all disciplines would be similar to that for the Sciences, though the funding shortfalls will differ somewhat depending on the supervisory and teaching requirements.

As for the TSP program, we argue that the challenges we face in meeting the additional costs of supporting Honours demonstrate the weaknesses of the current base funding arrangements. If base funding is intended to sustain high quality teaching, as well as provide underpinning support to allow our most talented students to maximise their potential and follow high quality pathways to higher degrees and research careers, then the current arrangements are fundamentally flawed. Ideally, the base funding arrangements should be flexible enough for institutions to recover the reasonable costs of delivering mission-specific specialised programs. We would have no problems if in return for such flexibility, institutions were required to meet higher standards of transparency over the use of funds and accountability for delivering promised standards of tuition.

8.5.4 Sustaining and measuring quality (Addresses consultation question 2.1, 2.2 and 3.2, also relevant to 6.1 and 6.2)

We estimate that in 2011 the University will invest $7.5 million to support the academic quality assurance and enhancement activities of the Deputy Vice-Chancellor (Education) portfolio and the Academic Board. These funds will be sourced from a mixture of general university funds and tied grants. We are certainly of the view that it is entirely appropriate for a proportion of base funding to be used to support academic quality assurance and enhancement.

The Go8 publication The Accountability for Quality Agenda in Higher Education released towards the end of 2010 provides a comprehensive overview of the current state of play internationally in measuring the quality of higher education teaching, student engagement and student learning outcomes.15 Our assessment is that while there is much interesting work underway in these fields at present, there are no definitive answers to questions such as which international measures of course quality or student engagement are the best, which would serve as appropriate benchmarks against which to judge the performance of the Australian system, and what is the best way to measure the value add of a higher education in terms of generic and disciplinary specific skills. We therefore focus our comments on what we do internally in order to ensure and enhance teaching quality, and on what drives our focus on quality.

15 Gallagher M, The Accountability for Quality Agenda in Higher Education, Group of Eight Ltd, 2010.

Graduate attributes

Our approach to quality assurance is built around a focus on the achievement of graduate outcomes as articulated in our Graduate Attributes Policy.16 It also central to our new strategic plan, through which we seek to embed the signature teaching and learning experiences of research-enriched and community-engaged learning in the curriculum for all students to better achieve these attributes. The Graduate Attributes Policy specifies two levels of graduate attributes. There are three overarching graduate attributes − Scholarship, Lifelong Learning, and Global Citizenship − which reflect the research intensive nature of the University, its scholarly values in relation to research-led teaching, and the place of its graduates in a global society. These attributes are developed through the participation of students as active members of the university community, through extra- curricular activities as well as in their formal studies. These overarching attributes are supported by the explicit achievement by our graduates through their learning in their courses in the following five clusters of:

1. Research & inquiry 2. Communication 3. Information literacy 4. Ethical social & professional understanding, and 5. Personal & intellectual autonomy.

Our graduate attribute matrix can be therefore be depicted graphically as follows:

The University of Sydney Graduate Attributes Matrix

Quality assurance

The University’s Deputy Vice-Chancellor (Education) oversees the implementation of the University’s strategies to enhance teaching and learning and manages a portfolio of support services that cover all aspects of the student experience: learning and teaching, e-learning and teaching infrastructure, student administration and support services, accommodation, co-curricular activities, student recruitment and social inclusion. Other key elements of the University’s approach in these areas include its Strategic Planning and performance measurement; Academic Board oversight, Faculty Teaching and Learning Plans and the Education Committee of the University’s Senior Executive Group, which comprises experts in education from each faculty and which advises the Deputy Vice-Chancellor (Education) about the University’s teaching and learning strategies.

The same five clusters of graduate attributes are contextualised differently in different disciplines, with each Faculty having its own statement of discipline outcome standards. The development of the University's graduate attributes is in turn supported by the development of generic foundation skills and abilities. The teaching and learning of these attributes within coursework degrees is assured through the robust quality assurance processes that are overseen by the Academic Board, which has principal responsibility under the Senate and subject to the powers of the Vice-Chancellor, for ensuring that the University maintains the

16 http://www.itl.usyd.edu.au/graduateAttributes/policy.htm

22 highest standards in teaching, scholarship and research and, in that process, for safeguarding the academic freedom of the University. These internal quality assurance processes include:

• Conducting periodic quality reviews of the academic standards of each of the University’s 16 faculties.17 • Monitoring of students' experiences of the teaching and learning in their units of study through the Unit of Study Evaluation (USE) process. • Monitoring of students' experiences of the teaching and learning in their degrees and courses through the Student Course Experience Questionnaire (SCEQ). • Monitoring of the Board’s formal policy requirement for the integration of the revised generic attributes in the learning outcomes communicated to students in unit of study outlines. • Monitoring of the Board’s formal policy requirements relating to integration of generic attributes in assessment standards and tasks. • Advising the University, faculties, schools and departments about action that should be taken in order to preserve or enhance academic standards.

In addition to our management and internal quality assurance processes, like all Australian universities, we are subjected to comprehensive periodic external review by the Australian Universities Quality Agency (AUQA). We must also satisfy the accreditation standards of the multitude of domestic and international professional bodies and are subjected to their course review processes as required. In terms of the quality of the broader student experience and student services, we constantly monitor student perceptions through surveys and dialogue with the student representative bodies. We also undertake internal and external reviews as required. For example, we recently engaged external consultants to conduct a comprehensive review of the University’s co-curricular activities, while an internal review of services for international students has also been completed. Both of these projects have informed the development of strategies that are now being implemented under the University’s Strategic Plan 2011-15.

Quality promotion and constant improvement

In addition to discipline specific initiatives overseen in the faculties and schools, two other significant ways by which we seek to assure and enhance the quality of the educational experience University-wide are through the maintenance of our Institute for Teaching and Learning (ITL) and through our E-Learning Unit.

Supported through a combination of general university funds and tied grants, the ITL works with the University community to conduct research and help assure and enhance the quality of teaching and student learning. It runs professional development programs and formal courses for university teachers. Its staff work with colleagues across the university to support faculty-based teaching and learning development and to collaborate on strategic initiatives. It provides the University's enterprise-level teaching and learning quality enhancement systems, survey and data, and in particular supports the University's planning and pursuit of its goals for research-enriched and community-engaged teaching and learning.

The Deputy Vice-Chancellor (Education), through Sydney eLearning, is also responsible for the quality and strategic management of shared learning and teaching infrastructure, embracing both physical and virtual space. The University’s shared learning and teaching space involves over 5 million e-learning sessions each year and over 26,000 scheduled lecture and seminar classes. The quality and strategic management of this learning and teaching space involves continual management of capacity and service alignment to the curricula needs of the University’s division and faculties. Sydney eLearning manages this responsibility through coordination of infrastructure planning and service provision with University ICT, Campus Infrastructure and Services, the University Library and other units in the Education Portfolio. It provides strategic management data to faculties for curricula planning and coordinates capital infrastructure development projects for shared learning and teaching space so that the outcomes align to the University’s education strategy and the needs of students and teaching staff.

On the question of the extent to which the current base funding model provides incentives for institutions to invest in and deliver high quality teaching and academic standards (consultations questions 6.1 and 6.2), our view is that the current model actually encourages the opposite behaviour. As discussed in section 8.3 above, the gaps between available funding and the actual direct and indirect costs of delivery and underpinning support in some disciplines, actually serves to encourage institutions to pursue quantity of provision over quality. Also, as noted above in section 8.3.1, at the University of Sydney funding shortfalls in

17 http://sydney.edu.au/ab/faculty_review/abr.shtml

23 some areas have contributed to the pursuit of strategies to increase the margins between income and costs in fields where we have more flexibility, while always doing so in ways that ensure that standards remains academically appropriate.

Furthermore, as discussed in section 8.1, 8.2 and again in 8.3.1, we believe that the base funding framework has been one of a number of factors that have together resulted in the pursuit of strategies by many Australian universities to grow revenues from postgraduate full-fee and international students. In our view the University’s focus on academic standards, quality assurance and the quality of the student experience has been driven more by the continued pursuit of its mission and the critical need to remain internationally competitive in order to attract top quality students and staff, than by the base funding system. External quality assurance processes undertaken by AUQA and professional accreditation bodies have also contributed more to the pursuit of quality than the base funding model.

8.5.5 Workplace learning (Addresses consultation question 3.4)

The wide range of workplace learning requirements that apply in different disciplines, the equally diverse funding models that characterise current workplace learning models, and the ever growing demand for student places as a result of the sector’s past and anticipated expansion, all add weight to the case for replacing the current base funding model with a new principles-based framework that is responsive to actual costs (and changes in costs over time) in different disciplinary contexts. We feel well placed to comment on these issues because of the breadth of the professional degrees we offer and the scale of the contribution we make to the workforce in NSW in particular. For example, we currently produce around 30 per cent of NSW health professional graduates annually.

In professional disciplines the cost of student workplace learning time undertaken in order to meet accreditation requirements is currently met by students themselves, education providers, by employers through direct or indirect contributions, or through a mixture of these sources. There is no common model. In each case the current arrangements result from a mixture of historical convention, incremental changes to external accreditation requirements, as well as policy changes at the state or federal levels.

By way of illustration of the diversity and complexity (and this summary is by no means intended to be exhaustive) the costs of meeting accreditation requirements in the legal and accounting professions is met entirely by the student, typically after graduation while they are employed with a restricted practising certificate and an entry-level salary. Some courses also have workplace elements as part of their requirements. It is a similar story for Pharmacists, with much of the workplace learning occurring in the year following graduation through the completion of a professional internship year on a training salary and completion of formal accreditation units and exams thereafter. Each of the other health disciplines − medicine, nursing, dentistry and the various allied health fields operate under variants of the same model, with different levels of reliance on direct and indirect support from clinicians in public and private hospitals and community care settings.

Graduate dentists and veterinarians are required to be competent to practise on patients and animals without supervision from their first day on the job and so have particularly intense workplace learning and competency requirements, which must be met as part of their studies. For vets these costs are met almost entirely by the University and require it to maintain an animal teaching hospital largely for this purpose. For dentists the costs are met though a mixture of University and public health system funding in the form of very high cost supervised teaching ‘chairs’ linked to public hospitals. Virtually no training of dentists occurs in private settings at present, largely because of the high costs and the fact that it is simply uneconomic for private practitioners to provide such training.

Social workers are currently required to complete 1,120 hours of supervised fieldwork placements with qualified practitioners as part of their degrees. They too are required to be ‘work ready’ at graduation, so must complete these placements as part of their studies. Our School of Social Work and students, therefore, rely heavily on the good will and in-kind support of the professionals to provide students with the required supervised training time in the workplace. The lack of funding detracts from ensuring that the professional development needs of students are met at different sites in ways that are adequate, credible and necessary. We would argue that funding should befit what we would expect to be a government commitment to professions in the social services.

Support for the professional preparation of teachers is not dissimilar. While governments stress the importance of teacher preparation, with supervised practicum requirements increasing in some states, and shifts to national standards with commensurate demands, financial support does not meet costs. For teaching students some funding is provided outside of base funding by the Commonwealth under the Other Grant Scheme Guidelines to assist institutions to meet the costs of the mandatory practicum component for students. However, the current level of funding is considered to fall well short of actual costs. while the practicum requirements of State education departments are prone to change, apparently with little dialogue with the Commonwealth or providers and invariably without commensurate changes to the base funding for the teaching practicum.

Work integrated learning has also long been a feature of Media and Communications degrees, which the University offers, as well as in architecture, building, design and engineering. Each of these area currently operate under distinct models with varying degrees of reliance on the in-kind contribution of time and resources from practitioners in public and private sector agencies. For example, engineers must complete a proscribed workplace learning schedule to meet the accreditation requirements for graduation as a professional engineer. Changes in the nature of engineering work, the willingness of engineering firms to provide cadetships and the general economic conditions has thrown an increased cost burden for achieving this outcome on both the student and the university. The university’s increased costs derive from the need to sustain closer relationships with industry to facilitate the student’s search for work and from having to track and support students through more complex pathways as they assemble a compliant portfolio of work.

There are obvious factors here which increase the cost of providing all of these courses, namely administrative support for Internship programs (in the form of internship coordinators) and also demonstrators who might specialise in particular technical applications or processes. But there are other less obvious costs associated with work integrated learning. In the area of Media and Communications for example, these include: smaller class sizes to facilitate effective training in media writing and editorial judgement; the integration of publishing activities and platforms into the curriculum, and other curriculum features such as problem based or ‘studio’ style activities where the curriculum is organised, as in the visual and performing arts, around project work such as the production of a television or radio program or a web site.

Another common element across disciplines is the ever-changing workplace learning requirements of the professions and the policy environment under which higher education providers must operate. Both of these areas are largely out of the control of providers but can impact significantly both on the availability of training places in different disciplines, the costs of provision and who meets them. There is no better example of this at present than the simultaneous process of the COAG National Health and Hospitals reforms, the entry of Health Workforce Australia into the clinical training space and the commencement of the Australian Health Practitioners Regulation Agency (AHPRA) with its efforts to achieve greater consistency in registration standards between all recognised health professions in Australia. As a result, the provision of clinical training across all health disciplines in Australia is undergoing substantial reform at present. Many of these changes are likely to impact on the costs of provision incurred by providers, but at this stage it is impossible to say whether the overall impact will be positive or negative.

In our view, the complexity workplace learning practice between disciplines, the varied cost sharing models, traditions and requirements of the professions, the constant evolution of accreditation requirements and changes in costs over time, mean that it is highly unlikely that any relative funding based approach will ever be able to appropriately accommodate the actual requirements in different disciplines. Continued reliance on a RFM model will ensure the continuation of a system that lacks transparency and which is reliant on the capacity of institutions to cover funding gaps through internal cross-subsidisation. This is one of the main reasons why we argue that Australia should make the transition to a new base funding model that is based on a robust understanding of the actual costs (and cost sharing) in different disciplines. This should include the direct and in kind costs of providing workplace learning.

8.5.6 Developing and maintaining infrastructure (Addresses consultation question 3.7)

We certainly agree that infrastructure costs, broadly defined, should continue to form a part of base funding. As we have argued above for the base funding system as a whole, as a starting point, the purpose of investing in university infrastructure needs to be articulated clearly. The Government’s approach to ensuring that sufficient support is provided for infrastructure needs to be based on sound principles which respond to nationally agreed objectives for the future of the sector.

The formal inclusion of a capital component in base funding has its origins in the ‘capital roll-in’ that occurred in 1994.18 This resulted in the transfer of most previous Australian Government capital funding for the higher education sector into the operating grants of providers. At the time, the value of roll-in, sector-wide, was $287 million.19 It is important to note that the Capital Development Pool (CDP) was also established in 1994 to complement the capital roll-in decision. The CDP established an annual competitive process by which providers could access additional funds to support specific, generally smaller scale, capital projects. As the Review Panel will be aware, the Australian Government recently announced that it would cease the CDP as a savings measure to offset the costs of the Queensland flood levy. One of the reasons the Government gave for its decision was that the Education Investment Fund (EIF) and other measures introduced since 2008, mean that the CDP is longer necessary.

Nevertheless, despite the generally positive impact that the EIF has had on infrastructure investment across the sector, serious infrastructure challenges persist. According to the most recent Go8 infrastructure benchmarking survey, the total estimated backlog maintenance liabilities of its members exceeded $1.5 billion in 2009. This liability represented 10.3 per cent of the estimated Asset Replacement Value (ARV) and had grown 1.3 per cent since 2007.20 In 2009, we estimated that our backlog maintenance liability for buildings was $385 million – 16 per cent of their total replacement value. We further judged that out of a total of 400 buildings, only 15 per cent (60 buildings) were rated as being in excellent or good condition. Based on a 25 year asset refit/replacement timeframe, we should ideally be dedicating around 4 per cent of our ARV to maintenance activities (preventative and corrective maintenance, backlog maintenance and refurbishment) annually. Despite our best efforts, between 2002 and 2009, we have averaged 2.32 per cent reinvestment in our building and support infrastructure combined. This does not include investment in new capital works, which in cases where demolition is required, should arguably be treated as reinvestment.

There are various reasons for these trends including our need to use available discretionary revenues to sustain our core teaching and research activities at acceptable levels of quality. The regressive indexation arrangements that have applied to the sector for the last 15 years have also placed ever-increasing pressure on our infrastructure budget, as we have sought to keep our staff employment conditions attractive in a highly competitive international market for the best talent. Furthermore, we have made the strategic decision to invest in major new teaching and research infrastructure in order to maintain the University’s international competitiveness. Around 70 per cent of our building infrastructure dates to before 1980. Much of the non- historic stock has now reached, or is reaching, the end of its functional life and decisions need to be made about whether refurbishment or demolition and replacement will provide the best long term outcome.

We welcome the investment the Australian Government has made in higher education teaching and research infrastructure in recent years through various schemes.21 Nevertheless, competitive infrastructure grant schemes such as the EIF have their drawbacks. The bid preparation process is a resource intensive gamble for institutions. Uncertainty about the timing of applications rounds, whether there will be rounds, and the Government’s priorities mean it is impossible to rely on schemes like the EIF as a source of funds to support an institution’s strategic priorities. Competitive schemes target new projects, which are favoured for their political impact and the short-term stimulus they may create, as much as for any long term benefits they will deliver. Moreover, even if successful, the funds provided invariably cover only a proportion of the construction costs and rarely provide for ongoing operating and maintenance costs. Institutions are invariably

18 DEST, Higher Education Endowment Fund, Consultation Paper, October 2007, p.13. 19 Group of Eight, Seizing the Opportunities, A Group of Eight Policy Discussion Paper, June 2007, p.35 20 Group of Eight, Infrastructure Survey 2009, p.8 21For example: the Education Investment Fund (EIF); the Health and Hospitals Fund (HHF); the National Collaborative Research Infrastructure Strategy (NCRIS); the Super Science Initiative of 2009; the Better Universities Renewal Fund (BURF); and the Teaching and Learning Capital Fund (TLCF).

26 required to augment EIF funds with their own discretionary funds, or with funds obtained from state governments or other sources external to the University.

In our case our success in the 2008 EIF round secured a commitment of $95 million from the Australian Government towards the construction of the Centre for Obesity, Diabetes and Cardiovascular Disease (CODCD). However, this represents less than 25 per cent of the estimated construction costs that we face. With a further four major new infrastructure projects currently on the drawing board and with funds available to cover just 20 per cent of the total estimated costs, we are currently taking the steps required to enable the University to access $500 million in debt financing in order to cover the funding shortfall. Once the loan has been secured, we will need to sustain a substantial operating margin in order to cover the interest repayments.

Our infrastructure challenges go well beyond meeting the cost of maintaining and renewing our teaching and research spaces. We also face substantial challenges in relation to our sports facilities and other student and staff amenities (particularly since the introduction of Voluntary Student Unionism), libraries, ICT infrastructure, and discipline specific teaching and research equipment and depreciation costs. Furthermore, with an estimated three students missing out on accommodation in and around our main Camperdown campus for every student that finds a place, we are currently searching for innovative ways to make thousands of more affordable beds available. Currently, only about 5 per cent of our enrolments live on campus or its surrounds in around 3,000 beds provided by the University, affiliated independent colleges and private providers. This compares rather unfavourably to the campus accommodation figures of universities in the United States with which we benchmark from time to time.22 Cost of living pressures in metropolitan Sydney, combined with commuting times, represent a significant barrier to the University improving the participation rates of students from low socio-economic backgrounds, from outer-metropolitan Sydney and rural and regional areas.

The various research block grant schemes provide transparency and considerable year-to-year funding certainty for institutions. This enables institutions to use the funds strategically to provide infrastructure support for their research activities. By contrast, the funding options available to support the teaching and learning missions of universities are ad hoc, unclear and in our view inadequate. Until the Government’s recent decision to abolish the CDP, it at least provided one recurrent source of competitive grant funding for modest infrastructure proposals. With it gone, the rapidly reducing EIF is now the only likely short term source of additional infrastructure for teaching and learning. At a time when the Government is seeking substantial enrolment growth in order to meet its participation targets there is a need for clarity and certainty about the availability of funding to support infrastructure renewal as well as new developments. As discussed above, the leveraging requirements of the EIF, combined with the uncertainty that surrounds the timing of rounds, means that it is not a scheme that the sector can rely upon.

The reality is that we can only support much of our required infrastructure investment in teaching and learning infrastructure from discretionary funds. With base funding representing a component of our discretionary revenues, it is clear that the Australian Government and current students are contributing to the maintenance and renewal of the infrastructure required to maintain the University’s core teaching and research missions into the future. If as a nation we are to sustain a higher education sector of international quality, then we simply must begin to take a more principled, strategic and realistic approach to our investment in supporting infrastructure.

One useful place to start would be to improve our infrastructure metrics. We should extend our teaching infrastructure metrics from ‘contact teaching hours’ to ‘student learning hours’, in other words, the amount of time students spend in physical and virtual learning space as required by course design. This would be a more accurate metric of learning and teaching infrastructure as it would allow universities to demonstrate the cost of providing both e-learning infrastructure and bricks and mortar infrastructure in direct relation to student benefit and use. Without a 'learning hour' metric, universities are hampered in demonstrating the extent to which they are funding and supporting quality learning and teaching activities through infrastructure investment that leverages their use of physical learning space with virtual learning spaces.

A more principled, strategic and realistic approach to our investment in supporting infrastructure would not only develop more appropriate metrics, but would start with a robust appraisal of the level of investment

22 For example, at Michigan State University, The University of Minnesota, Twin Cities, The University of Texas at Austin and the University of Wisconsin, Madison, which have 40 per cent, 21 per cent, 20 per cent and 25 per cent respectively of their undergraduate student population living on campus and much higher rates than these for first year students.

27 required annually in order to sustain infrastructure of an acceptable international standard of quality for the long term. The aim should be to arrive at a transparent baseline figure for ongoing investment in the maintenance, renewal and construction of the full range of infrastructure required to provide a high quality learning environment. These costs should then be recognised as a recoverable component of base funding, with institutions held accountable for the maintenance of the national estate through the Compact process.

8.5.7 Providing high quality student support services and amenities (Addresses consultation question 3.2, 3.3 and 3.8)

In 2011, in addition to expenditure that will occur in the faculties, the University has budgeted to invest $136 million in strategies, support services and specific projects designed to improve the quality of teaching and the quality of the overall learning experience for all of our students. The funding for these activities comes from general university funds, which include base funding, and from various tied sources of external revenue. While we do run programs and provide services targeted at specific cohorts of students, we sustain a comprehensive range of services that are available to the entire student body and in some cases staff and the community more broadly. We see the maintenance of such services as vital to sustaining the overall quality and accessibility of the university experience for students.

In terms of academic support for students, by way of example, resources and services supported from a mix of funding sources include: the University Library; the Learning Centre, which provides workshops on essay writing, critical reading, oral presentation skills, time management and other essential generic skills; the Mathematics Learning Centre which provides ongoing assistance to students in mathematics and statistics; and computer labs.

Beyond academic student support services such as these, the University provides a broad range of services to support the health and well-being of all students. These include: the University Counselling service which exists to assist students with any issue of concern that may be interfering with their studies; the Equity Support Service, which provides advice and other types of support to students about accommodation, child care, disability and financial matters; the University Health Service which provides access to bulk-billed high quality medical care on campus; the Careers Centre which provides students with support finding employment during and after their studies; and the Multi-faith Chaplaincy Centre which provides students with access to appropriate spiritual and pastoral support as required. Furthermore, dedicated academic and pastoral services for Indigenous students are provided through the Koori Centre on the University’s main campus and Yooroang Garang at the Faculty of Health Science’s Cumberland campus, while the University’s International Student Office offers dedicated support for students from overseas.

Since the introduction of Voluntary Student Unionism (VSU) in 2006, we have worked with our various student organisations to ensure that the important student representation, pastoral, social and sporting services and facilities they provide have been maintained at acceptable standards. Over the four years 2007 to 2010, we estimate that our direct financial support for services and amenities provided by our six student organisations amounted to some $38 million. In addition, as a direct result of VSU the University has also had little choice but to increase the levels of ‘in kind’ support it provides its student organisations, for example in the form of ICT, finance, insurance, and infrastructure provision. We estimate the value of this in kind support at in excess of $5 million annually. Without the provision of such substantial cash and in kind support, we have little doubt that the quality of student services and amenities available to all students at this University would have diminished below acceptable levels for an institution of its type and international standing.

We are firmly of the view that it is reasonable for all students to make an annual contribution to support the maintenance of high quality student services and amenities that are essential to support the mission of the University. Such fees are charged routinely by public and private universities alike in the United States, for example, in recognition that a broad range of services are required in order to sustain a high quality educational environment. Appendix 6 provides examples of the student services fee schedules from the University of Wisconsin, Madison, where the fee is currently $527 US and where strict restrictions are placed on the purposes for which the funds may be used, from UCLA and the University of California, Santa Cruz where the fee schedule are both very detailed and students pay $900 US annually as a student services fee, along with fees levied to cover various other services or initiatives not directly related to the student’s in-class experience.

Until Australia resolves the issue of student service fees, institutions will continue to face the choice of either having to support these services from general funds, thus diverting resources from core teaching and research activities, or cutting back the services. To date, we have taken the first option in the hope that the political impasse would be resolved. However, we recognise that the arrangements we have in place at present are not sustainable in the long term and while we would be dismayed to see the services provided by student organisations reduced further, this is a very real possibility unless we are given the capacity to raise funds from students specifically for these purposes. As the American examples show, this can be done transparently, with safeguards put in place to ensure that students know that the contributions they make are only being used to support certain specified activities.

We support the passage through Parliament of the Higher Education Legislation Amendment (Student Services and Amenities) Bill 2011 (Cth), even though we question the adequacy of the proposed $250 annual fee. We particularly support the proposed arrangements to ensure that students need not incur an upfront fee and to enhance transparency and accountability over the use of funds. Our greatly preferred option, however, would be for a student ‘services and amenities’ fee to simply form a clear part of the contribution to base funding made by each student annually.

8.5.8 Access and support for other students with particular needs (Addresses consultation question 3.3)

Low SES students and students with disabilities

In section 8.5.3 above we detailed some of the costs that the University incurs in providing targeted programs to unlock the potential students with particular promise in the sciences, and in providing high quality supervision of undergraduate students in their Honours year. We argued that neither of these types of activities is covered by base funding and that the development of any new principles-based funding model should include consideration of how institution specific programs focused on particular cohorts of students might be accommodated.

Students with particular talents and interests relevant to research represent one special needs group, but there are many others students with particular needs that the base funding model arguably does not serve well at present. Two such groups are students from low socio-economic backgrounds and students with disabilities. At present, as outlined below, we think there are mixed messages coming from Government about the extent to which base funding includes a component intended explicitly to support the provision of support services for students from these groups. Nevertheless, all of the general support services discussed in section 8.5.7 above, and funded from a mix of general University and tied funds, are available to students from these backgrounds, with some of the services specifically tailored to meet their particular needs.

Some of these specialised services are currently supported with targeted funding received from the Commonwealth through schemes such as the former Diversity and Structural Adjustment Fund (DSAF) or the new Higher Education Participation and Partnership Program (HEPPP) which comprises a low SES loading and competitive project component. Similarly, in a further effort to encourage institutions to enrol more students from low SES backgrounds the Commonwealth is offering performance funding through the Compact process to reward those providers that achieve annual low SES participation targets. With the assistance of funding from the DSAF the University’s Social Inclusion Unit has been able to run innovative programs in collaboration with the University’s local schools and community groups to make the University accessible and appealing to the most promising students from our diverse community.

Additional support is also available for providers to assist with the costs of providing specialised academic and other support services for students with disabilities. The Additional Support for Students with Disability (ASSD) funding currently provided by the Commonwealth is based on the following parameters:

1. That the provider covers the first $500 of costs incurred in supporting a student with disability to access and participate in study. 2. That every dollar over the $500 is then claimable through the ASSD program, as long as it pertains to the direct support for a student with disabilities.

3. The Commonwealth then reimburses the provider for a proportion of the costs incurred over and above $500.23

The Government’s current approach to funding for low SES participation suggests that base funding is not intended to cover, or does not sufficiently cover, the costs of providing the types of programs that are necessary in order to enhance low SES participation and support students from these backgrounds once enrolled. It is the same for Indigenous participation, with additional funding provided annually to students based on Indigenous student load. While there is also a performance loading paid to institutions based on disabled student load, the ASSD appears to be based on an assumption that providers will meet the first $500 of expenses incurred for each disabled student annually from general university funds, which includes base funding.

As a result, providers are expected to cover a significant share of the costs associated with the provision of additional support for disabled students. At the University of Sydney we are experiencing increasing numbers of students registering with disabilities, and an increased proportion of these with high support needs. Due to increased numbers and demand at University the ASSD our level of reimbursement has been reduced to less than 72 per cent of the actual costs incurred above the $500 threshold. In addition, there are hidden administrative costs that are not included in the claimable expenses under the ASSD.

While we would prefer to see the number of separate schemes reduced as much as possible, with the funds saved rolled into the Commonwealth component of base funding, we recognise that using student load as the funding driver is a transparent and effective way to provide an incentive for institutions to enrol students from targeted equity groups. On balance, we therefore do not believe that base funding should include a component to cover University costs in these areas. We have little doubt, however, that if funding received for core teaching and research activities was more closely aligned with actual costs, one likely outcome would be that the performance of institutions in enrolling students from disadvantaged backgrounds would improve as resources currently required to support these core functions are released to achieve social inclusion outcomes.

Upfront living costs remain a key obstacle to improving low SES participation

The Review’s Background Paper (pp.62-64) covers well the available literature concerning the impact that the introduction of HECS in 1989 may have had on the participation in higher education of people from different backgrounds. We agree with the Panel’s initial assessment that the findings of various studies that have examined the impact of HECS, and subsequent HECS increases, on the willingness of people from low socio-economic backgrounds to pursue university studies, are mixed. We note, however, that the participation in higher education of people from low SES backgrounds is a long term concern, with the participation rate at least not worsening since the introduction of HECS, even though it hasn’t improved significantly either – remaining around 14 or 15 per cent between 1989 and 2007.24 Recent surveys suggest that there is strong support for HECS as a policy instrument to enable participation in higher education. 25 The adoption of similar policies by countries such as the United Kingdom suggests that it has considerable merit as a means of widening access to education. The financial returns for an individual completing a university degree in Australia still remain high.26 Moreover, while HECS is a deferred liability loan scheme the consensus appears to be that low SES groups are not particularly debt averse compared to other groups, or that the introduction of HECS has perpetuated or enhanced socio-economic inequalities.27

We suggest therefore that the reasons for the continuing low participation rates in higher education by people from low SES backgrounds are complex. We believe that they go beyond deferred tuition costs, and are likely to have more to do with other factors such the level of exposure a person has to higher education as a realistic pathway during school years, as well as the significant upfront financial barriers that persist, both in terms of opportunity costs from pursuing study, and in meeting day to living costs while studying. We are hopeful that the current Government’s focus on encouraging greater levels of engagement between

23 http://www.deewr.gov.au/highereducation/programs/equity/hedisabilitySupportProgram/Pages/Home.aspx 24 Bradley D et al, Review of Australian Higher Education Final Report, December 2008, p.28. 25 Higgins T & Withers G, Community Attitudes to Income Contingent Loans, Australian Journal of Labour Economics, V12, No.2, 2009, p.217-236, pp.217. 26 ABS, Research Paper: Measuring the Private Rates of Returns to Post-School Education in Australia, September 2010. 27 Andrews L, Does HECS Deter, Factors affecting university participation by low SES groups, Occasional Paper, DETYA, 1999, p.25.

30 universities and schools in low SES communities, combined with enhanced levels of income support for disadvantaged students while students, will result to improvements in the low SES participation rate over the long term.

Given the high and ever increasing costs of living, particularly in and around university campuses in our capital cities, we suggest that as part of an overhaul of base funding, consideration should also be given to making HECS or a similar form of income contingent loans available to targeted students from low SES backgrounds. This would reduce the current need, confirmed by regular Universities Australia Student Finances surveys, for students from low SES backgrounds to have to spend much of their time working while studying in order to meet their living costs.28 In support of this suggestion, we note the information provided in submission appended by our Faculty of Architecture referencing a recent study by the University of Technology Sydney, which found that out of pocket student expenses for equipment, materials and access to production materials and technologies in Architecture and Design fields averages between $10,000 and $20,000 per student per year. If HECS were extended to cover the living and out of pocket academic expenses of students as part of a holistic approach to base funding reform and achieving social inclusion, then we believe the impact on the low SES participation rate could be significant.

The 20 per cent HEC discount for upfront payments

One inequitable policy that we hope the Review Panel recommends should be removed as part of the base funding review is the current 20 per cent discount on a student’s HECS liability if an amount of $500 is paid up front. As Birch and Miller found in their 2006 study, students from favourable socio-economic backgrounds are far more likely to pay their HECS debts up front, or have their debts paid for them, than students from less favourable backgrounds. As a result:

‘As they graduate, therefore, students of poor socioeconomic backgrounds will emerge with, on average, considerable debt... Consequently, they will have lower after-tax earnings (until their debt is repaid). Any decisions that are based on net wealth or after-tax earnings will be affected. In comparison, relatively few students of rich socioeconomic background complete their university studies with outstanding HECS debt.’29

Notwithstanding the argument that the 20 per cent discount reflects the net present value of the student’s loan liability, we suggest that the upfront HECS discount should be removed.

8.5.9 The trend to postgraduate coursework provision (Addresses consultation questions 4.1 and 4.2)

As the Panel’s Consultation and Discussion papers note, there has been strong growth in provision of postgraduate coursework degrees across the sector over the last decade or so. This has certainly been the case at the University of Sydney as we outlined in section 8.1. We also addressed some of the factors that we believe have led to these trends in section 8.2. These included: an increasing trend to lifelong learning in the community, as graduates seek career changes or recognise increasingly that a bachelor qualification may no longer be sufficient to achieve their career goals; a shift towards a postgraduate degree being the standard, or required, pathway to accreditation in a profession domestically or internationally; and the flexibility that institutions have had to offer courses at this level on a full fee paying basis, with Fee-HELP assistance available for domestic students.

While in the time we have had available to prepare this submission we have not been able to provide evidence to support our claim that in some disciplines the costs are higher for postgraduate coursework degrees than undergraduate degrees, we believe that this is the case and trust that the Access Economics study will produce reliable data on this issue. We believe this is so as class sizes at the postgraduate level are generally smaller and the courses are generally taught by more senior staff, while the style and methods of delivery are also different.

28 http://www.universitiesaustralia.edu.au/page/submissions---reports/commissioned-studies/student-finances-survey/ 29 Birch E & Miller P, HECS and HECS-HELP Equity Issues, Journal of Higher Education Policy and Management, Vol. 28, No. 2, July 2006, pp. 97–119, p.116

In section 7 we provided ten enduring principles around which we suggested a new base funding framework could be built. Key among these was Principle 3:

Cover actual costs The total base funding rate for each discipline should cover the agreed actual costs of delivering and sustaining agreed minimum standards of education in the discipline at the undergraduate or postgraduate level as relevant. Ideally, the assessment of costs should be undertaken by a statutory body that is independent of the Government and providers.

If the level of base funding available per CSP student at the undergraduate or postgraduate level is to remain regulated under a new funding framework, then we suggest that the level should be determined through a robust and transparent assessment of the cost of delivery at either level in each discipline nationally. If a provider then believes that it requires a higher level of base funding in order to deliver an educational experience above an agreed minimum for the field and level, then it should be required to justify the reasons for higher costs and be held accountable by TEQSA or the Government through the Compact process for demonstrating the achievement of agreed quality benchmarks or indicators.

We believe that full-fee provision at the postgraduate level, combined with student access to Fee-HELP, has been one of the policy success stories for the sector over the past decade, promoting diversity and innovation in the delivery of courses to meet the changing demands of students and employers. While we agree that there is a need to ensure that funding for CSP places at the postgraduate level is sufficient to meet higher costs of delivery, we would be strongly opposed to any reforms which sought to regulate the capacity of providers to offer full fees at the postgraduate level.

8.5.10 Disciplinary specific challenges (Addresses consultation question 3.1)

We discussed in sections 8.3.1 and 8.3.5 some of the trends that have resulted in our generalist degree programs, we suggest, at least in part as a result of the higher education base funding arrangements that have been in place for the past twenty years. The appended submissions from five of our faculties, which have taken a particular interest in the Base Funding Review, include data, information and analysis specific to their disciplines.

We have sought to summarise the key issues raised by each faculty below. In our assessment, the disciplines of Agriculture, Dentistry, Veterinary Sciences and Music Performance (all of which we offer) face significant funding challenges largely as a result of the gap between costs of delivering education in these disciplines at international levels of quality and the level of revenues received from the combination of base funding and other sources. The funding pressures are not limited to these disciplines, however, with our Faculty of Architecture, Design and Planning and the Sydney School of Medicine also providing (or intending to provide) information to support their claims that current funding levels fall well short of meeting the reasonable costs of quality provision in their fields.

There are various other disciplines, not covered in the separate submissions made by our faculties, where concerns are held by academic staff about the appropriateness of the current positioning of their disciplines within the funding clusters, as well as the base funding levels. Some of these are detailed below. While we do not believe that rearranging the make-up of the current funding structures will produce an outcome that sustainable in the long term, if the Review Panel is to take such an approach, then we suggest that consideration should be given to the appropriate placement of, and base funding for, these disciplines.

Agriculture The Dean of the Faculty of Agriculture, Food and Natural Resources, Professor Mark Adams, has provided the following statement for inclusion in the University’s submission:

‘Australia and much of the rest of the world is facing an acute problem of declining numbers of graduates in agriculture degrees at a time when the world is facing both a food and an environmental crisis. In Australian universities, agriculture degrees have traditionally been of four years duration in contrast to related science degrees that are of three years duration. A

significant part of the difference is due to the broad context of agriculture and the need for students to understand economic, environmental and social aspects of production, as well as basic science aspects.

Current funding models do not properly capture this important difference. Units in agricultural and resource economics are funded at less than one-fifth the rate of units in science fields as part of agriculture degrees. This strongly skews how degree courses are constructed and thus the knowledge base of graduates.

A further significant problem is that the costs of field-based units of study are not different to those based in classrooms and laboratories, despite the much greater cost of delivery of field-based units. For example, Agronomy (management of pastures and crops) is widely regarded as the absolute core of agriculture.

Agronomy must include substantial field-based teaching if it is to be made relevant to students. Teaching of agronomy at the University of Sydney involves field-trips to the major livestock and cropping centres, all of which are at least five hours distant and thus requiring hiring of buses and overnight accommodation, meals etc.

The lack of renewal of teaching infrastructure for agriculture is a further significant issue. Field-stations at every major university involved in teaching agriculture in Australia have been closed due to lack of funding and thus a lack of maintenance and renewal. Proposed new teaching developments designed to address the urban-rural ‘knowledge gap’ (e.g. most urban people have no idea how food is produced) at the edges of major cities, lack financial support.

In summary, at a time when Australia desperately needs to increase the number of graduates, the funding for agriculture teaching within universities is clearly inadequate’.

The Australian Council of Deans of Agriculture has made many of these and other arguments and has provided quantitative evidence. We hope that the Base Funding Review will recommend that further detailed work be undertaken, in consultation between the Australian Government, State governments, the Agriculture industry and providers to develop a long term strategy for sustaining capacity in a discipline that is clearly significant to the nation’s future.

Archaeology

Through historical circumstance, Archaeology has traditionally been placed within Arts (through a perceived alignment with History) or in some cases Humanities (the latter usually in association with Anthropology). This is despite post-1960s developments within the discipline, which has seen it adopt a strong scientific base, such that research and teaching is almost identical to that seen for physical geography and some of the biological sciences. Undergraduate programs therefore require significant expenditure on laboratory infrastructure and field equipment, as well as a more complex teaching commitment of workshops and training (on and off-campus) beyond the usual lecture and tutorial structure of most Arts subjects. Staff, Honours and Postgraduate research students and Postdoctoral Fellows require similar basic resourcing with the addition of more complex equipment and facilities for field surveying, remote sensing, excavation, laboratory sorting and specialised chemical and physical analysis, as well as storage.

In many instances State, Federal and International permissions to undertake research are contingent on being able to demonstrate that appropriate equipment, infrastructure and storage are available. Similarly, success in nationally competitive research grant programs is also dependent upon demonstration that such facilities are available at the applicant’s host university. Archaeology has strong government and industry relationships and its programs progress students towards professional careers, although this also demands meeting industry expectations for training.

Architecture and related fields (Faculty submission included at Appendix 7)

Our Faculty of Architecture, Design and Planning has contributed the preparation of the submission from the Australian Deans of the Built Environment & Design. A copy of that submission is included with the letter from the Dean in Appendix 7. The unifying characteristic of these disciplines is their focus on the design and procurement, valuing and management, of sustainable urban environments, products and media. These disciplines rely heavily on support provided by industry and professional groups associated with professional accreditation, student workplace experiences, mentoring and support for student projects and teaching through guest lectures and advice on curriculum content and delivery. The proportion of expenditure required to support digital technologies, their maintenance and software has increased threefold from already high base in 2005, with the discipline concerned that such cost increases cannot continue to be absorbed by providers. Very high student ‘out of pocket’ costs are the norm in these disciplines and concerns are held about the implications of these costs for equity of access. The disciplines argue that affordability is impossible to achieve for low SES students without unencumbered financial support. They are strongly of the view that the Australian Bureau of Education Field of Education (FOE) codes on which the Cluster Funding arrangements are based, should be reviewed regularly to take account of changes modes of delivery and costs. Moreover, they argue that they have experienced exponential growth in costs in recent years, and that the current base funding arrangements do not encourage providers to invest in and deliver high quality teaching.

Dentistry (Faculty submission included at Appendix 8) Our Faculty of Dentistry has participated in a detailed costing study undertaken by KPMG with six dental schools and the results will be included with the submission by the Australasian Council of Dental Schools. The Faculty’s submission, included as Appendix 8 attaches the Council’s report.

Graduates of dentistry courses are required to deliver a comprehensive scope of dental procedures at a high level of patient safety without supervision from their first day on the job. Few other professional training courses require this standard of work readiness from the commencement of a graduate’s professional career. Quality outcomes in dental education are prescribed and assessed by the registering body (Dental Board of Australia). Dentistry students perform irreversible and potentially life threatening invasive procedures on human patients. Patient safety is at all times the critical issue. Consequently, dental education requires high staff-student ratios, quality pre-clinical training and quality clinical supervision provided by academic staff who must be experienced clinicians.

While dental schools maximise the use of simulated learning environments, real clinical experience is required for registration. In clinical settings, for every four to six students, a clinician is required (who is a dentist or dental specialist). There is a clear difference with respect to resource requirements between this mode of learning experience and, for example, a lecture provided for a larger number of students where assessment material is distributed to students to conduct in their own time with minimal guidance using online library facilities. Dentistry degrees require this form of learning experience for students in addition to expensive pre-clinical and clinical training.

The current cost challenges faced by Australian dental schools, largely as result of shortfalls in base funding, are analysed in detail in the KPMG report. Most important is the estimate of a cost of $33.9K per annum to train a dentist and $34.5K per annum to train an oral health therapist at Sydney University. This contrasts with an existing funding allocation of $28.1K per annum from the Commonwealth under Funding Cluster 8. Importantly, these estimates do not include the time spent by staff on research (discussed in section 8.5.2 above) or the significant contribution that the NSW Department of Health makes towards clinical training of dentists through infrastructure, training facilities, consumables and staff time.

The Faculty argues that if its costs continue to rise over the next five years without commensurate funding support, it may become non-competitive nationally and may not be in a position to claim international equivalence. It argues that such an outcome would undermine the professional reputation of the Faculty’s programs, which could in turn affect demand from international students.

In terms of alternative approaches to supporting the training of Dentists in Australia, the Faculty encourages the Panel to consider developing a funding allocation methodology which addresses the fully scope of training costs similar to the user-pays models in place in countries including the USA and Canada where there is no comprehensive public health system. The Faculty argues that while the Australia’s health system

34 evolved from, and is similar to, that in the UK, the Australian health system is fundamentally different because in the UK the NHS provides comprehensive funding for hospitals and university clinical training programs for dentists and a comprehensive identification of real costs is required in Australia.

Engineering

The University’s Faculty-Division of Engineering and Information Technologies (E&IT) is one of the leading engineering research and teaching faculties in Australia. In 2010, the faculty had 4,332 Students comprising 3,161 undergraduate students and 1,171 postgraduate students including over 400 research degree students. The Faculty makes a significant contribution to the national economy and the national skill base and it has the challenge of achieving quality teaching outcomes while absorbing increased cost of operations. These costs have been identified in the Australian Council of Engineering Deans (ACED) submission to the review.

The most critical of these challenges are the very high (by global standards) staff student ratios (SSR) in Australian engineering schools. ACED suggest that Australian SSRs are nearly double those of the USA. Similarly, our faculty has the highest reported SSR at this University. Maintaining quality and developing and implementing improved techniques for learning and teaching is very dependent on being able to maintain a globally competitive level of resources. Lack of funds also contributes to the inability to make key staff appointments as well, leading to gaps in key leadership positions which further limit teaching and research innovation. Infrastructure renewal too has suffered in the drive to contain costs within available resources – again at the expense of maintaining at least parity with standards of global excellence.

Another issue shared across all engineering schools is the need for students to obtain workplace experience in order to meet the requirements of the degree as specified by the accrediting body, Engineers Australia. ACED identified that the costs and complexities of meeting this requirement have increased over recent years and have been absorbed by universities and students.

The drive to improve social inclusion and broaden access also has special challenges for the engineering discipline. In addition to the need to support such students financially and academically during their time at university there is a need to provide transitional pathways where students can be equipped to participate and succeed at a tertiary level. Funding for such pathways is currently strongly reliant on industry or university support. In an era of skills shortages in the engineering field, investment in broadening of sources of potential graduates will serve not only equity agendas but will add to the national pool of skills in a critical area.

Law

The University of Sydney’s Faculty of Law is an internationally oriented and engaged law school, which seeks to educate lawyers for careers where the market for legal service is increasingly globalised and where they will need to be able to move with comfort across national boundaries and different legal systems. The Faculty considers that the current base funding arrangements for the discipline do not recognise the importance of legal services in the global context, or the opportunities that exist for Australia to develop a significant services export industry through sustaining legal education of the highest standard. While current base funding for the field may cover the costs of providing the basics in regard to standard teaching (at unit of study level at least) this is considered inadequate to be competitive in the international tertiary environment. In order to be competitive with the best law schools internationally, the Faculty needs to provide high quality infrastructure and support services, a range of extra curricula activities such as workplace training, scholarships (including equity scholarships), international opportunities, bridging programs, mentoring programs, mooting programs, social justice program etc. Fees from the Faculty’s discretionary sources of revenue currently cross-subsidise activities at the undergraduate level where necessary. The Sydney Law School would oppose regulation of legal education at the postgraduate level, without significant increase in base funding for the discipline, as revenues earned from postgraduate coursework programs currently underpin its ability to offer comprehensive programs, support and extra- curricular opportunities for students at all levels.

Medicine (Faculty advice about its proposed submission is included at Appendix 10)

The Dean of the Sydney Medical School wrote to the Review Secretariat on 24 March 2011, advising that by the end of April it hoped to provide the Review with data arising from a costing study it commissioned prior to the establishment of the Review. The Faculty’s submission will complement that prepared by Medical Deans Australia New Zealand and, in particular, will extend that submission by seeking to quantify the value of ‘in- kind’ contribution made by practitioners and others outside of Medical schools.

Music (Faculty submission included at Appendix 11)

The submission from the Sydney Conservatorium of Music details the plight of tertiary music institutions in Australia. It makes clear the importance of music education to the national economy and cultural identity and describes the positioning of Australian music education and the music industry in a world context. The cost structures for music education are explained and the shortfalls in current levels of funding are identified. The submission concludes by recommending that a long-term approach be taken to design a specifically targeted process for determining funding for music education which recognises the cost structures in the field and is benchmarked internationally. Given that achieving such an outcome would inevitably take some time, and the urgency of the funding challenges facing the discipline, the submission further recommends that as a transition arrangement, music education for performance and composition courses should be moved from Funding Cluster 5 to Funding Cluster 8, thus placing these forms of music education with disciplines that have comparable cost structures.

Performance Studies

The Consultation Paper notes the growth of inter-disciplinary studies as a potential complicating factor in determining costs of course delivery. Performance Studies, which crosses traditional divides between humanities, social science and the creative arts, is a case in point. ‘Performance’ is now used widely as a key theoretical trope in disciplines as diverse as linguistics, philosophy, history, sociology, media studies and management. However, the premise underpinning the Performance Studies curriculum at the University of Sydney is that the insights afforded by this theoretical frame are strongest when combined with a rigorous understanding of actual performance practice across a wide range of genres and cultural/historical contexts.

A Performance Studies major (available within the Bachelor of Arts and other degree programs offered by the Faculty of Arts and Social Sciences) therefore includes significant amounts of studio-based learning, as well as production internships and ethnographic participant-observation of work made by professional artists- in-residence, along with advanced theoretical units covering the anthropology of ritual, the phenomenology of dance, the sociology of theatre production and cultural policy-making and so on. To deliver this curriculum currently requires maintenance of three small theatre studios, one larger theatre, a dance studio, cameras for photographic and video documentation of performance, a digital editing suite and a unique performance archive, together with the salaries of 4.5 academic staff, a technical director and half-time programme coordinator. Equipped with highly sophisticated interpersonal skills, critical thinking and a solid grounding in ethnographic fieldwork methods, our graduates proceed to careers not only in the performing arts and drama education but also in areas of research, policy development and management in the private and public sectors.

Pharmacy

Pharmacy is a major discipline in the Division of Medicine, Dentistry, Nursing and Pharmacy at this University and is a profession subject to regulation by the Australian Health Practitioner Regulation Agency. The Pharmacy Board of Australia has designated the Australian Pharmacy Council as the accreditation authority responsible for accrediting education providers and programs of study for the pharmacy profession. A registrable Pharmacy qualification may be obtained by following either of the following pathways:

• a four year full time undergraduate program resulting in the award of a Bachelor degree; OR • a two year full time (or equivalent) postgraduate program and/or articulated program resulting in the award of a Masters degree, open to graduates possessing the pre-requisite knowledge, skills and attributes prescribed in the accreditation standards;

The Australian Pharmacy Council has a clear process for the accreditation of pharmacy degree programs and, as noted above, has also established definitive accreditation and competency standards. These standards place the requirement on all Schools of Pharmacy, or their equivalent organisational unit, to be able to deliver a program which synthesises the practical laboratory-based disciplines of the pharmaceutical sciences and the clinical and placement requirements of a health practitioner.

Our Faculty of Pharmacy argues that education and training in Pharmacy should occur at a level which reflects the scientific and clinical components of the program taught in those very same scientific and clinical disciplines. Currently pharmacy receives total funding at a rate (Allied Health cluster) which is below that of the Science and the Medicine / Dentistry / Veterinary Sciences funding clusters and, in contrast to other Allied Health disciplines, receives no specific placement funding. An elevation in total funding is therefore seen as necessary. The Faculty proposes that such an increase in funding could either occur via the addition of Pharmacy to a funding cluster such as Cluster 7 (Engineering or Surveying) – disciplines which also require both intensive laboratory studies and placement activities or by the establishment of a separate Pharmacy discipline cluster which would provide appropriate and equivalent funding commensurate with its science / clinical nature.

Social Work

Social work is currently listed in a cluster alongside disciplines such as political science, sociology and anthropology. These disciplines do not have the significant fieldwork education requirements required in order for social work students to meet the accreditation standards of their profession. Social Workers must be work - ready upon graduation. Accreditation requires 1120 hours of supervised fieldwork placements with skilled social work qualified practitioners within external agencies with considerable additional input from social work qualified university staff. This has to be resourced and fully supported by universities and is costly. Training in student supervision also needs to be provided for fieldwork educators. Overall the issue of inadequate funding of social work training is becoming a matter of urgent concern for the discipline. The Australian Government has recognised the challenges through the inclusion of Social Work under the clinical training initiatives of the Health Workforce Australia. However, there is a need for an integrated approach which ensures that the combination of funding is sufficient to meet the efficient cost of provision.

Veterinary Science (Faculty advice about its submission is included at Appendix 9)

The Faculty of Veterinary Science will provide its submission to Review by 8 April 2011, at which point we will adjust our submission to include the Faculty’s final input. The Faculty has contributed to the preparation of the submission that will be provided by the Australian Council of Veterinary Deans. Its submission will complement that submission, as well as the University of Sydney’s submission.

The Faculty argues that base funding of veterinary education has been recognised as inadequate for a decade, with little if any action taken to address the problem. It suggests that a crisis is imminent in the discipline and profession if base funding levels are not brought into line with the reasonable actual costs of providing veterinary education at international standards of quality.

The submission outlines the economic benefits of veterinary education to Australia’s global trade in animal products, through services in food security, food quality and animal health. It details how and why research- engaged Australian Veterinary schools incur costs to achieve the high global standards mandated by national and international accreditation bodies.

The submission argues that veterinary training exceeds the costs of all other health and agricultural disciplines because it requires individual supervision of students undertaking technically demanding, invasive procedures on animals, with attendant risks for staff, students, clients and animals. Procedural competence must be demonstrated for all graduates in animal handling, diagnosis, imaging, anaesthesia, medicine, surgery, pathology, food safety and veterinary public health. This can only be achieved by learning and assessment of students working with animals in expertly supervised clinical and farm-based practical classes and through students taking responsibility for clinical cases in University veterinary teaching hospitals. Students, universities, the Government, external donors and the profession contribute to provision of the required practical experience, but are struggling to meet these costs.

The strategies pursued successfully by Australian veterinary schools to access new sources of funding to sustain veterinary education of an international standard are outlined, as are the risks inherent in the high reliance on revenues from sources such as international students. In support of these arguments, the submission includes detailed costing data, prepared with assistance from the University’s Finance office, as well as extensive international benchmarking. A variety of solutions are proposed, which consider the impact to students, universities and Government, and key stakeholders in rural and veterinary industries.

9. Conclusion (Addresses consultation questions 6.3)

The University of Sydney’s Compact agreement with the Commonwealth includes the following extract from the White Paper which was released in August 2010 alongside its Strategic Plan 2011–2015:

‘The real measure of whether the University is travelling well is the extent to which our staff, students, government, alumni and friends find in it the institution that is entailed in our statement of purpose, our values and strategies. This is the vision of an institution in which there is freedom for individual researchers to pursue their own lines of enquiry, but also an evidence-based understanding of our research strengths and an institutional ability to invest strategically in research and education projects (particularly large-scale, cross- disciplinary projects) of national, regional and international importance. It is the vision of an institution in which students and researchers have a sense of belonging to a single community of scholars, of being engaged together in learning and enquiry, and in which excellence in research is prized.

In this vision the community of scholars is marked by its diversity, by its global orientation, and by its commitment to working in partnership with Indigenous Australia. Researchers and teachers are drawn from all over the world ... and both staff and students from overseas are impressed by the cosmopolitan nature of the academic community that they find. The University is well connected and regarded in local, rural and international communities and has grown its links with China...

In this environment, students have a rich campus life and their experience of dealing with university administration is seamless from first enquiry to alumni engagement. They have opportunities for both formal and informal learning, in classroom and community-based contexts, both in Australia and overseas. Teaching is stimulating and constantly refreshed by new thinking about pedagogy and the use of technology to enrich the student experience and promote flexible learning. Curriculum delivers on our graduate attributes in ways that can be measured and the suite of the University’s degree offerings are coherent and well coordinated, allowing students ease of movement between faculties, particularly in the generalist undergraduate degrees…

In short, the University delivers on its mission of being a place in which both academic quality and community engagement are valued, in which ideas are not only intrinsically important, but also important because of the difference that they can make in the world. It is a place of both engaged enquiry and mutual accountability in which the brightest researchers and most promising students can thrive and realise their full potential.’30

30 http://sydney.edu.au/strategy/docs/white_paper_2011-15.pdf, p.59

Whether the system of base funding that supports the Australian higher education sector is reformed or not, over the next five years we will be pursuing this vision − the achievement of which we believe is in the interests of our students, staff, the state of NSW and the nation. We know, however, that our capacity to realise our long term goals, will be enhanced greatly if well thought out reforms to the base funding framework can be agreed and implemented in a considered way.

We trust that the information we have provided in our submission, combined with the discipline specific Faculty submissions and the data we will provide as part of the Access Economics study, support our argument that simply persisting with some modified version of the current RFM-based cluster funding arrangements is not a tenable option.

We hope that we have demonstrated the fundamental interdependencies that persist in Australian universities between the education and research missions of universities and the different sources of funding that support activities in both areas. We caution against any approach that seeks to decouple the two components, without thinking through the likely implications for institutions with research-enriched teaching and learning at the heart of their missions.

Our overarching hope is that the Review Panel will provide the Government with a compelling case for the shift to be made to a new base funding framework, which is based on a clear understanding of the actual costs of sustaining high quality education in different disciplines and settings. While we have not proposed a specific model or models for how this might be achieved, we believe that the enduring principles we provided in section 7 provide a possible framework around which a robust new base funding model could be built.

We are attracted to both the Go8’s statement of purpose for higher education base funding and the proposal that an independent higher education pricing authority be established, alongside TEQSA to have responsibility for operational decisions about determining the quantum of base funding required in different disciplines and settings. This would ensure that decisions about overall funding levels, and adjustments to funding over time, are based on transparent costing and educational criteria with a minimum of political interference. It would then be left to the Government to determine the level of the contribution it was willing to make towards each CSP place according to its assessment of the public and private benefits of a student completing a particular course of study.

In return for added pricing flexibility for providers, we would expect the Government to use TEQSA the Compact process to hold providers accountable for achieving agreed quality benchmarks. We would also expect robust independent information to be made available publicly about the overall quality of each publicly funded institution, as well as the standards of its teaching and research in each field.

We are confident that if we can make the transition to a base funding framework that is sufficient to cover the agreed full costs of sustainable provision, discipline by discipline, we will be able to increase significantly the contribution that we make to the Government’s objectives for the future of the Australian higher education sector.

Appendices

Appendix 1 Base Funding Review Consultation Questions Consultation areas/questions Submission reference by section or appendix 1. General principles governing the level and distribution of government investment in higher education learning and teaching

Q1.1 Government investment in higher education has been justified in terms of delivering benefits to the Section 7 economy, benefits to society and equity of access for students from all socioeconomic backgrounds. Should these principles continue to be applied, and if so how should they be used to determine the appropriate level of government subsidy for the cost of universities’ learning and teaching activities?

Q1.2 What principles should determine the appropriate balance of resources contributed by: Section 7 · Government; · students; and · other sources towards the cost of undergraduate and postgraduate education?

Q1.3 What other principles, if any, should influence the level and distribution of government subsidies for Section 7 tuition costs in higher education?

2. A globally competitive level of base funding for course quality and student engagement

Q2.1 What are the best international measures of course quality that would provide appropriate Section 8.5.4 benchmarks to inform judgments about the appropriate level of base funding for Australian universities?

Q2.2 What are the best international measures of student engagement that would provide appropriate Section 8.5.4 benchmarks to inform judgements about the appropriate level of base funding for Australian universities?

Q2.3 Is there a system of higher education funding in another country that would be a useful benchmark Not addressed model to inform Australia’s review of base funding? specifically

Q2.4 What is the connection between the level of base funding and quality outcomes? Not addressed specifically, but implicit throughout submission, in particular sections 7 and 8. 3. The relative costs of quality teaching and student engagement at the undergraduate level

Q3.1 Do the current funding relativities reflect the relative cost of delivering undergraduate courses in Sections 8.5.1, particular disciplines? What, if any, relative weightings should be afforded to various discipline groups and 8.5.2, 8.5.3, 8.5.4 why? 8.5.10 And all appended Faculty submissions Q3.2 What are the costs to universities of improving the quality of teaching and the quality of the student Sections 8.5 all learning experience at the undergraduate level and to what extent should they be reflected in the base And all Faculty funding model? submissions

Q3.3 What are the costs of engaging low SES students in undergraduate education? Should such costs be Sections 8.5.7 & a factor in determining base funding? How might support for low SES students be maintained in the 8.5.8 future?

Q3.4 What additional costs are involved in the provision of work integrated learning and should these be Section 8.5.5 and considered in setting the level of base funding? All Faculty submissions Q3.5 What proportion of a higher education teacher’s time should be spent on scholarly activity and how Sections 7, 8.5.1 could the costs of scholarship be included in the base funding model? and 8.5.2

Q3.6 Should any research activity continue to be supported by base funding? Sections 7, 8.5.1, 8.5.2 and 8.5.3 Q3.7 Should infrastructure investment continue to be supported by base funding? Sections 7 and

8.5.6

Q3.8 What other factors, if any, should be taken into account in determining base funding for teaching and Sections 7, 8.5.7 learning in higher education? and 8.5.8

4. The relative costs of teaching at the postgraduate level

Q4.1 Is there a higher relative cost for postgraduate coursework degrees? If so why is there a difference See 8.5.9 and what is the extent of the difference compared to an undergraduate degree in the same discipline?

Q4.2 Are there other factors that contribute to the costs of postgraduate coursework degrees that should See 8.5.9 be acknowledged in the base funding?

5. The appropriate level of student contribution towards the cost of higher education tuition

Q5.1 Are there general principles that should determine the maximum contribution a student should make Section 7 towards the cost of their education in a publicly funded higher education system?

Q5.2 In what circumstances should the level of students’ contribution towards the cost of their courses be Sections 7 and based on factors other than the cost of their tuition? 8.5.8

Q5.3 Should the basis for determining the level of contribution by the student towards the cost of their Sections 7 and tuition be different at the postgraduate level? 8.5.10

6. A new base funding model

Q6.1 To what extent does the base funding model provide incentives for institutions to invest in and deliver Section 8.5.4 high quality teaching?

Q6.2 Does the base funding model provide incentives for institutions to maintain strong academic Section 8.5.4 standards?

Q6.3 What features could be incorporated in the design of a new base funding model to make it more Sections 7 & 9 simple, transparent and responsive to higher education providers?

Appendix 2 The University of Sydney Key Indicators, 1990 and 2010

Metric 1990 2010 Percentage change 1990 to 2010 Students Enrolments Undergraduate 22,329 32,612 46% Bachelor 19,875 31,316 58% Other undergraduate 2,454 1,296 -47%

Male 9,194 13886 51% Female 13,135 18726 43% Domestic 21,547 26,791 24% International 782 5,821 644%

Postgraduate 5,448 16,447 202% Masters coursework 2,070 9,835 375% Masters research 796 839 5% PhD 1,153 3,464 200% Other postgraduate 1,429 2,309 62%

Male 2,810 6856 144% Female 2,683 9591 257% Domestic 4,984 11,436 129% International 464 5,011 980%

Gross total 27777 49,059 77% Less double enrolments 103 480 Net total students 27,674 48,579 76% Undergraduate % 80.4% 66.5% -13.9 percentage points +13.9 percentage Postgraduate % 19.6% 33.5% points Male % 43.2% 42.3% -0.9 percentage points Female % 56.9% 57.7% +0.9 percentage points Domestic % 95.5% 77.9% -17.6 percentage points +17.6 percentage International % 4.5% 22.1% points

Equivalent Full Time Student Load (EFTSL) Bachelor 18,675.10 27,599.50 48% Other undergraduate 2,033.20 476.50 -77% Masters coursework 1,025.40 5,608.60 447% Masters research 599.3 659.30 10% PhD 960.5 2,932.50 205% Other postgraduate 937.8 827.10 -12% 42

Metric 1990 2010 Percentage change 1990 to 2010 Total load 24,231.30 38,103.50 57%

Completions (2009) 5,450 13,435 147% Bachelor 3,272 7401 126% Other undergraduate 325 32 -90% PhD 72 562 681% Masters research 55 164 198% Other postgraduate 917 5276 475% Level unspecified 809 not available

Staff Academic 1,886.40 3,371.8 79% Male 1,246.60 1855.6 49% Female 639.8 1516.2 137% +11.1 percentage Female % 33.9% 45.0% points General 2,837.60 4213.6 48% Male 1,397.90 1641.9 17% Female 1,439.70 2571.7 79% +10.3 percentage Female % 50.7% 61.0% points Total full-time equivalent staff 4724 7585.4 61% Female % 44.0% 53.9% +9.9 percentage points

Salaries data by level academic and general* 15,609- Academic 141,400 Level E & above 152,201+ 118,156 - Level D 130,167 98,131 - Level C 113,151 Level B 80,109 - 95,128 Level A 56,076 - 76,098 1,000- General 113,175 HEO 10 & above 98,239+ HEO 9 91,903 - 96,972 HEO 8 79,247 - 89,374 HEO 7 70,802 - 77,134 HEO 6 64,470 - 69,534 HEO 5 56,028 - 62,780 HEO 4 51,807 - 54,763 HEO 3 45,477 - 50,540 HEO 2 43,365 - 44,631 43

Metric 1990 2010 Percentage change 1990 to 2010 <=40,408 - HEO 1 & below 42,098

Student to staff ratio - whole institution 11.9 16.7 40%

Finance (1992 & 2010)* Year 1992 Year 2010 Income State 15,701 15,936 1% Student fees, including HECS and full fees 61,079 502,160 722% Other, including Cth funding for teaching research** 380,531 984,986 159% Total income $,000 457,311 1,503,082 229% Expenditure Employees 315,441 848,199 169% Depreciation 27,102 70,466 160% Borrowing 13 1,087 8262% Other 95,564 467,223 389% Total net expenditure $,000 438,120 1,386,975 217% Operating result before income tax and impairment of available for sale assets 19,191 116,107 505% Notes 1990 student data as a 31 March 1990 2010 student and staff data as at 31 March 2010 except where indicated * 1990 Annual Financial Report not comparable with 2010.

* *For 1992 includes donations, bequests and grants for research and other purposes. A large proportion of the increase in the 'Other' line is due to increases in Commonwealth funding for research and research training through a number of agencies.

Appendix 3 The University of Sydney Economic Model

Appendix 4 Estimating the proportion of base funding used to support research at the University of Sydney

The University provides financial data on its research and experimental development activities to the ABS every two years. The last survey covered the calendar year 2008. While the ABS Higher Education Research and Experimental Survey are not auditable, and rely on a number of assumptions that could be contested, they can nevertheless be used to estimate the extent to which the University supports its R&D activities from sources of income other than grants intended specifically to support the direct and indirect costs of research. In 2008 the ABS estimated that the University’s total expenditure on R&D was $802 million. The breakdown of the University’s total expenditure on R&D in 2008 provided in the table below:

Type of expenditure 2008 Capital expenditure Land, buildings and other structures $'000 87,480

Other $'000 24,826

Sub-total $'000 112,306 Current expenditure Labour costs $'000 306,256 Scholarships $'000 45,594 Other $'000 337,569

Sub-total $'000 689,420 Total Expenditure $’000 801,726

The sources of income from which this R&D expenditure was supported is summarised in the table below:

Source of funds 2008 Australian Competitive Grants Commonwealth $'000 130,313 Non-commonwealth $'000 20,159 State local government $'000 27,660 Other commonwealth government $'000 222,617 Business $'000 24,384 Donations, bequests and foundations $'000 14,250 General University Funds $'000 348,214 Other Australian $'000 0 Overseas funds $'000 14,129

Total expenditure on R&D $'000 801,726

Of the University’s total expenditure on R&D in 2008 of just under $802 million, some $453.5 million was supported by external revenues specifically intended to support the direct and indirect costs of research. These included $150 million from nationally competitive grant programs, $222.6 million from the Commonwealth mainly through research block grants and scholarship schemes, and $80.5 million from a combination of other domestic and international sources.

The figure of $348 million attributed to ‘General University Funds’ includes an amount $164.9 million, provided by the University, which covers the balance of expenditure on R&D covered directly by the institution. This includes income from external sources where funds were provided for institution operations and which were not specifically tagged for R&D projects. In order to calculate the total R&D expenditure, the ABS also calculates an estimate of indirect or overhead costs, attributing a proportion of each University’s expenditure on general services that provide indirect support for the conduct of its core education and research functions. This overhead is calculated at 60 cents for every dollar of expenditure on academic and general staff time dedicated to R&D.

Our 2008 estimate of 2,665 full time equivalent academic and general staff members dedicated to R&D was based on 100 per cent allocation of staff designated ‘Research Only’, 40 per cent for staff classified as ‘Teaching and Research’, 100 per cent for ‘General Research’ staff and 20 per for general support staff. As a result the ABS estimated the University’s R&D overhead costs at $183.75 million. In 2008 the University spent some $87.5 million on new capital expenditure, with funds sourced primarily from savings over the previous ten years, which have now been depleted. Removing this expenditure from the ‘General University Funds’ revenue line leaves a total of $260.7 million in general University funds spent directly or indirectly on R&D, but sourced from non-research specific revenue. In 2008 the University’s total revenue from all sources not directly attributable to R&D which could be considered discretionary was $786.2 million. This includes revenues and income from the following sources:

Sources of discretionary revenues 2008 Commonwealth Grant Scheme $'000 210,633 Higher Education Loan Program $'000 141,983 Student fees and charges $'000 274,540

Investment revenues $'000 32,304 Royalties, Trademarks and Licences $'000 1,426 Other revenue and income $'000 125,278

Total $'000 $786,164

We estimate therefore that in 2008, for every dollar of discretionary revenue earned by the University, some 33 cents was used to cover either direct or indirect overhead costs associated with sustaining the University’s research enterprise. Once implemented fully from 2013 the Sustainable Research Excellence initiative has the potential to reduce the level of support required from discretionary sources. This depends on the degree to which the Government is willing to accept improved investment in teaching and learning as a measure of the success of a research-focused program. As our operations, revenue and expenditure profile has not changed significantly since 2008, we estimate that supporting our research activities continues to account for roughly 33 cents of every discretionary dollar of income we earn – including income from domestic and international students. With the University receiving $317.8 million in base funding from the Commonwealth in 2008 (CGS $210.6 million and HECS-HELP $107.2 million), we therefore estimate that some $105 million of this revenue was used to support research activities, predominantly in the form of staff time on research and overhead costs associated with supporting that effort.

Appendix 5 Costing undergraduate research programs

Talented Student Program (within the Faculty of Science)

The methodology used to arrive at the estimated average Net Cost per student participating in the Talented Student Program (TSP) shown at the bottom of the table involves the following: • Direct Revenue and Costs relating to the 2010 Talented Student Program (TSP) • University Economic Model (UEM) Levies, Charges and Cost Recoveries supporting TSP • The Net Cost per student was calculated by spreading the Net Cost (Direct Revenue less Direct Costs and UEM Levies, Charges and Cost Recoveries) over the number of 2010 students participating in TSP projects Direct Revenue includes student fees earned under the TSP program. Direct Costs (academic and general salaries and other non salary items) were calculated in consultation with TSP coordinators. Academic staff salary costs include coordinating, teaching, supervising and assessing time within the program. UEM Levies, Charges and Cost Recoveries were calculated using the current standard rate per cost driver. UEM costs include expenses incurred by the University with respect to the enrolment, marketing and services provision (library, lab, lecture and office space etc) of the TSP students.

Faculty of Science 2010 Talented Student Program

($000) Total Revenue Commonwealth Supported Places 286.8 International UG Fee Paying 25.2 Student Fees 312.0 Total Direct Revenue 312.0 Expenses: Salary Academic Salary Costs 262.6 General Salary Costs 16.2 Casual Salary Costs 2.0 Total Salary Costs 280.8 Expenses: Non Salary Communications 20.0 Student Costs 0.5 Non Salary Costs 20.5

Total Direct Costs 301.3

Gross Contribution Margin 10.7

UEM Levies, Charges and Cost Recoveries Contributions to DVC Programs 22.0 Research Contribution from Faculties 7.9 Recovery Capital Reinvestment Levy 17.4 Recovery Professional Services 52.5

Total UEM Levies, Charges and Cost Recoveries 99.8

Net Cost 89.1 Number of TSP students that conducted projects in 2010 51

Average Net Cost per TSP Student that conducted projects ($000) 1.7

Appendix 5 (continued) Costing undergraduate research programs

Honours Student Program (within the Faculty of Science)

The methodology used to arrive at the estimated average Net Cost per Honours student shown at the bottom of the table involves the following: • Direct Revenue and Costs relating to the 2010 Honours Student Program within the Faculty of Science (using Schools of Maths & Stats, Physics and Chemistry as case studies) • University Economic Model (UEM) Levies, Charges and Cost Recoveries supporting the Honours Student Program • The Net Cost per student was calculated by spreading the Net Cost (Direct Revenue less Direct Costs and UEM Levies, Charges and Cost Recoveries) over the number of 2010 Honours Students (EFTSL) Direct Revenue includes student fees earned under the Honours Student program. Direct Costs (academic and general salaries and other non salary items) were calculated in consultation with Honours Students coordinators. Academic staff salary costs include coordinating, teaching, supervising and assessing time within the program. UEM Levies, Charges and Cost Recoveries were calculated using the current standard rate per cost driver. UEM costs include expenses incurred by the University with respect to the enrolment, marketing and services provision (library, lab, lecture and office space etc) of the Honours students.

Faculty of Science 2010 Honours Student Program Selected Schools Maths & ($000) Stats Physics Chemistry Total Revenue Commonwealth Supported Places 251.7 591.2 560.1 1,402.9 International UG Fee Paying 61.9 41.1 46.4 149.5 Student Fees 313.6 632.3 606.5 1,552.4 Total Direct Revenue 313.6 632.3 606.5 1,552.4 Expenses: Salary Academic Salary Costs 304.4 564.8 502.0 1,371.1 General Salary Costs 3.4 4.9 48.7 57.1 Total Salary Costs 307.8 569.7 550.7 1,428.2 Expenses: Non Salary Communications 5.0 10.0 8.0 23.0 Student Costs 2.5 5.0 4.0 11.5 Non Salary Costs 7.5 15.0 12.0 34.5

Total Direct Costs 315.3 584.7 562.7 1,462.7

Gross Contribution Margin (1.7) 47.6 43.8 89.7

UEM Levies, Charges and Cost Recoveries Contributions to DVC Programs 22.1 44.6 42.7 109.4 Research Contribution from Faculties 8.0 16.0 15.4 39.4 Recovery Space Charge 32.4 61.8 95.6 189.8 Recovery Capital Reinvestment Levy 20.0 34.5 33.6 88.1 Recovery Professional Services 62.6 103.5 90.7 256.8

Total UEM Levies, Charges and Cost Recoveries 145.1 260.4 278.0 683.5

Net Cost 146.8 212.8 234.2 593.8 Number of Honours Students (EFTSL) 17.50 28.00 26.75 72.25 Average Net Cost per Honours Student ($000) 8.4 7.6 8.8 8.2

Appendix 6 Sample Student Service Fee Schedules

University of Wisconsin Madison –Segregated Student Fee Schedule (http://registrar.wisc.edu/documents/Seg_Fees_UGRD_1112-1114.pdf)S

Full-Time Segregated Fee Distribution for All EXCEPT Grad Students Fall 2010 – Spring 2011

Non-allocable Health $165.84 Union $208.68 CCTAP $9.84 SAC/UHS Bldg Fee $20.04 Intramural $26.04 Allocable GSSF $17.28 ASM $18.84 Bus Pass $53.76 Ancillary $4.68 UC $2.00 Total $527.00

Health: The University Health Service portion of the segregated fees supports the clinical medicine, counselling, health education, and public health mission of the student health services.

Union: This portion of the segregated fees supports the facilities at Memorial Union and Union South and provides a free lecture series of the Wisconsin Union Directorate.

CCTAP: Child Care Tuition Assistance Program portion of the segregated fees provides tuition grants to students with children to pay for child care costs. SAC/UHS

Building Fee: The SAC/UHS Building Fee supports the debt service for construction of the Student Activities Centre and University Health Services facilities at University Square.

Intramural: This portion of the segregated fees provides funding for the programs and facilities operated under the Division of Recreational Sports General Programs budget. Major facilities supported in this budget include the Southwest Recreational Facilities (SERF), Camp Randall Memorial Sports Centre and the Natatorium.

GSSF: General Student Services Fund provides support for an array of services and programming for students at UW – Madison. Examples include Greater University Tutorial Service, the Student Tenant Union, Campus Women’s Centre and Student Leadership Program.

**See following for a list of organizations receiving allocations.

Student Gov’t. The Associated Student of Madison portion of the segregated fees supports the operation Activity: of the UW – Madison student government association and other student group funding that is distributed by ASM.

Bus Pass: Provides a free bus pass for each student on all non-campus Madison Metro Transit System bus routes.

Ancillary: An allocable SUF fund established by SSFC to provide funding for services to students that are not necessarily provided by student organizations and that require greater than an annual funding commitment due to prior capital investment or contractual obligations.

United Council: This fee supports representation activities by the United Council of Student Governments of UW System institutions. Although strictly not a segregated fee, it is assessed with the segregated fee group but at a flat rate of $2.00 per student without regard to credit load.

** General Student Services Fund (GSSF) 2010-2011 Funded Organizations Adventure Learning Program Badger Catholic Campus Women’s Center FH King Greater University Tutorial Service MEchA Multicultural Student Coalition PAVE Sex Out Loud Student Leadership Program Student Tenant Union Wisconsin Student Lobby WISPIRG Working Class Student Union Wunk Sheek ______University of Wisconsin – Madison Office of the Bursar August 2010

UCLA - Fees Graduate and Undergraduate Annual 2010-11 http://www.registrar.ucla.edu/fees/gradfee.htm Updated August 24, 2010 Fees are subject to revision without notice. The charges below include the Educational Fee, Student Services Fee (formerly University Registration Fee), professional school fees, and tuition charges as well as UCLA campus-based fees which are assessed to all full-time students. The charges are flat fees based on enrollment status (e.g., undergraduate, graduate student, professional school student), not the number of enrolled units. They do not include additional course or unit-based fees such as the IEI Fee or course materials and services fees that may be assessed for enrollment in selected courses, room and board costs for living on campus, or books and supplies. Summer Sessions has a separate fee schedule. For information on reductions, see Reduced Fee Programs. The amounts shown in this document represent fees as currently approved. However, all University fees are subject to change, and the fee amounts billed for this period may be adjusted at a future date. See the fees menu page for updated fee information.

Graduate Academic Students Undergraduate Students Resident Non Resident Resident Non Resident Student Services Fee (formerly University $900.00 $900.00 $900.00 $ 900.00 Registration Fee) Educational Fee 9,402.00 9,810.00 9,402.00 10,260.00 Undergraduate Students 121.38 121.38 Association Fee Green Initiative Fee 12.00 12.00 PLEDGE Fee 38.92 38.92 Graduate Students 38.25 38.25 Association Fee* Graduate Writing Center Fee 12.00 12.00 Ackerman Student Union 55.50 55.50 55.50 55.50 Fee Ackerman/Kerckhoff Seismic 113.00 113.00 113.00 113.00 Fee Wooden Center Fee 45.00 45.00 45.00 45.00 Student Programs, Activities, and Resources Complex 93.00 93.00 93.00 93.00 Fee Medical Insurance Fee 1,921.08 1,921.08 1,087.14 1,087.14 (GSHIP/USHIP) Course Materials and varies, see course listings Services Fee Nonresident Tuition** 14,694.00 22,021.00 TOTAL MANDATORY FEES $ 12,579.83 $ 27,681.83 $ 11,867.94 $ 34,746.94 * Reduced $.75 per vote in Spring 2010 general election; approved 8/18/10 by Chancellor Block. ** Nonresident Tuition is reduced 100% for students advanced to doctoral candidacy.

010–11 UC Santa Cruz Registration Fees (http://reg.ucsc.edu/Fees/fees.html)

The fees for 2010 are listed below. Fees, tuition and other charges are subject to change by the UC Board of Regents of the University of California without advance notice.

The new UC Blue and Gold Opportunity Plan establishes a minimum level of grant and scholarship aid for undergraduate students. Read the fact sheet for detailed information about the plan for 2010-11.

Apply for private scholarships.

Registration fees are due and payable before the beginning of each quarter. The billing dates and deadlines for payment are found in the Academic and Administrative Calendar and printed in the quarterly Schedule of Classes. The information is also included with the billing statement; for more information on billing and methods of payment, go to the Student Business Services web site.

For background information including, when applicable, referendum language and fund distribution, go to the Student Affairs Student Fees web site, which also links to fee information for UCSC Summer Session.

Fee Refund Schedules are located at the bottom of this page.

Undergraduate Student Annual Fall 2010 Winter 2011 Spring 2011 Fees* Student Services Fee 900.00 300.00 300.00 300.00 Educational Fee 9402.00 3134.00 3134.00 3134.00 Campus Programs Fee 6.00 2.00 2.00 2.00 College Student Government 30.00 10.00 10.00 10.00 Fee Student Programs Fee 153.00 51.00 51.00 51.00 Campus Sustainability 18.00 6.00 6.00 6.00 Program Fee Engaging Education Program 12.60 4.20 4.20 4.20 Fee Community and Resource 15.00 5.00 5.00 5.00 Empowerment Fee Student Voice and 2.25 0.75 0.75 0.75 Empowerment Fee Student Media Council Fee 9.60 3.20 3.20 3.20 Theater Arts Fee 6.00 2.00 2.00 2.00 Student Facilities Fee 90.00 30.00 30.00 30.00 Student Life Facilities Fee 90.00 30.00 30.00 30.00 Seismic Safety Fee 120.00 40.00 40.00 40.00 Transportation Fee 334.98 111.66 111.66 111.66 OPERS Fitness Facilities Fee 45.00 15.00 15.00 15.00 Free/Anonymous HIV Testing 2.25 0.75 0.75 0.75 Fee Campuswide Student 21.00 7.00 7.00 7.00 Government Fee Campus Childcare Fee 24.00 8.00 8.00 8.00 Intramural and Sports Club Team 6.75 2.25 2.25 2.25 Activities Fee Recreation Programs Fee 12.00 4.00 4.00 4.00 Seymour Marine Discovery 0.75 0.25 0.25 0.25 Center Fee Renewable Energy Fee 9.00 3.00 3.00 3.00 Learning Support Services 19.92 6.64 6.64 6.64 53

Fee Intercollegiate Athletics 15.00 5.00 5.00 5.00 Sports Team Fee Physical Education Program 13.50 4.50 4.50 4.50 Fee Sustaining the Student Media 12.42 4.14 4.14 4.14 Voice Fee Student Health Center 81.00 27.00 27.00 27.00 Expansion Fee *Student Health Center Green 5.20 0.00 0.00 5.20 Building Fee Support GIIP Fee 3.99 1.33 1.33 1.33 Increase Library Hours of 19.50 6.50 6.50 6.50 Operation Fee Sustainable Food, Health, 11.25 3.75 3.75 3.75 and Wellness Fee Sustainability Office Fee 8.25 2.75 2.75 2.75 USHIP Health Insurance 1353.00 451.00 451.00 451.00 (waivable)** Total California Resident 12853.21 4282.67 4282.67 4287.87 Nonresident Tuition Fee 22021.00 7341.00 7340.00 7340.00 Ed Fee Differential 858.00 286.00 286.00 286.00 Total Nonresident 35732.21 11909.67 11908.67 11913.87 *Initial quarter the fee will be charged is spring 2011.

**This fee is waivable if the student already has private insurance. Contact the Health Center for information on waiving this fee.

Submission of the Faculty of Architecture, Design & Planning

The Faculty of Architecture, Design & Planning has been party to the development of the Australian Deans of the Built Environment & Design (ADBED) submission to DEEWR and endorses this version of ADBED’s submission, as representing the Faculty’s response to DEEWR’s, Base Funding Review.

28th March, 2011

ADBED Submission to DEEWR Base Funding Review

Q1.1 Government investment in higher education has been justified in terms of delivering benefits to the economy, benefits to society and equity of access for students from all socioeconomic backgrounds. Should these principles continue to be applied, and if so how should they be used to determine the appropriate level of government subsidy for the cost of universities’ learning and teaching activities?

The Australian Deans of the Built Environment and Design (ADBED) lead a broad spectrum of disciplines. In educational settings our disciplines now focus on activity types mirroring environmental science and engineering that require our students to work in technology- enabled studios that are like high-end workshops and laboratories. Our courses require strong financial self-investment by our students and necessitate that universities provide learning environments on our campuses that are professionally supported by teaching capacity in several technical specialisms. The delivery of our courses also require that we develop educational settings that bridge the differences seen between professional work and academic forms of higher learning. To this end it is paramount that ADBED’s disciplines now offer educational settings with professional experience by funding the creation of placement opportunities. It is when professional settings are understood to contextualise higher learning that our students will be skilled for leadership into the future.

The unifying characteristic of ADBED disciplines is their focus on the design and procurement, valuing and management, of sustainable urban environments, products and media. Their impact goes beyond ‘service’ to leading thought-development, planning and infrastructure in new urban settings. Our disciplines encompass visual, digital, fashion, product and architectural design, construction and project management, planning, property development and quantity surveying. These disciplines are central to the longevity of construction and creative industries’ impact on the Australian Gross Domestic Product (GDP)1 as well as contributing significantly to the value of the export sector and our reputation overseas. The construction industry is the fourth largest in contribution to the GDP, and both sectors of construction and creative industries have significant employment numbers adding to 16 per cent of the national work force. The contributions by our professions make substantive differences in efficiencies and value in this aspect of our economy.

1 Australian Bureau of Statistics’. ABS, 1350.0 Australian Economic Indicators, Oct 2010, “Feature Article: A Statistical Overview of the Construction Industry”. The Centre for International Economics has claimed that the creative industries contribute 2.8 per cent to GDP. “Australia Creative Industries Economic Analysis: Final Report”, Canberra: Centre for International Economics, 2009, p.6 3

Recognised as well, in recent ABS figures is the growth in importance of professional services to the economy: fifth in its impact on GDP. Our disciplines are centrally engaged with the education and continuing development of these professionals for future industry leadership. Through experimentation and open-ended research of the social, environmental and economic workings of sustainable urban societies, our complementary disciplines share a range of methods, approaches, and techniques of valorisation. Fundamentally, the basis of our disciplines builds on the notion that they identify, design and procure sustainable urban environments, media and products aimed to enhance the economic, social and cultural value of Australia. The shared vision of our disciplines is to educate professionals who will design, procure, manage and value the products, places and spaces of sustainable cities.

The Deans of Built Environment and Design disciplines support and applaud the government’s principles as stated in Q1.1, noting the need for an appropriate level of government subsidy for the cost of universities’ learning and teaching activities.

Q1.2 What principles should determine the appropriate balance of resources contributed by: · Government; · students; and · other sources towards the cost of undergraduate and postgraduate education?

The principles determining an appropriate balance of resource contribution must be mindful of the significant current contribution made by the range of groups associated with university education.

Significant support is provided by the industry and professional groups associated with professional accreditation, workplace student experience, and support for student projects, guest lectures and curriculum advice.

The second significant influence for generating principles for government contribution to ADBED disciplines is the changing proportion of expenditure required to support digital technologies, their maintenance and software associated with specific disciplines. In ADBED disciplines, the budget proportion spent on technologies and their impact has increased at least threefold in 2010 from a high base in 2005. This is not simply reflecting the move to using computers as seen in other disciplines. The growth, mirroring environmental science and engineering disciplines, can no longer be absorbed by current base load funding levels determined by Field of Education categories.

With the shift to digital technologies in ADBED disciplines, universities have struggled to support student learning at the necessary level. The depreciation costs associated with highly sophisticated equipment where equivalencies have previously only been seen in the better funded engineering disciplines cannot be absorbed, such equipment as high end computers, servers and software, three-dimensional (3D) plotters and large format printers (design and architecture), laser cutters (design and architecture), CNC Routers, Immersive 3D systems used with Building Information Modelling (BIM) (construction and architecture), 3D knitting machines and fabric printers (architecture and fashion), etc. While in old analogue machine workshops, the machines still can be used with minimal maintenance while parts can be found, new digital technologies and the machinery and materials associated with them have short life spans and high costs. Their servicing, technical support and maintenance needs 4 remain high and they require new environments for teaching and learning that are space hungry and necessarily supported with dust and fume extraction.

A third significant and little-recognised cost is that born by our students. The academic expectation for high levels of production in student assignments, often to the level of manufacturing prototype or public exhibition standard, and the changing technologies of production (laser cutters, digital prints etc) required to support assignments have increased student financial commitment to their education. While in 2005 EPI studies showed Australia to be 12th of 16 nations in the affordability of university education2, in our disciplines affordability is now a real question when students apply to study. Unlike education in the science disciplines, where students are provided with chemicals and other materials with which to conduct their experiments, our disciplines require students to self-fund materials for assignments at increasingly high levels. The cost of education is proportionally transferring to students at an alarming rate. While in 2005 EPI suggests that ‘out-of-pocket’ after tax expenses in Australian degrees averaged $8621.34, recent studies have found that costs in ADBED disciplines may be on average between $10,000-$20,000.3 Our disciplines would rank amongst the most expensive to students because of the differing price of materials, production techniques and technologies. These expenses are not necessarily commensurate with potential levels of income for graduating students.

Principle 1: Equity of Access: the Australian government should support and ensure equity of access of students to our disciplines by financially resolving the recent cost transfer of education to students specifically from our disciplines. (Solutions may see current student investment in their education offsetting HECS debt).

Principle 2: Fields of Education categories require continuous review: ADBED strongly suggest that the Australian government audit the levels of its commitment shown through the Fields of Education categories to recognises changes in modes of production. Many descriptors are now out of date and new descriptors need formulation. Those fields with exponential cost increases like Design and Architecture are under funded and should be recognised, with commensurate funding, for their similarity to Engineering fields.

Principle 3: Recognition of the investment to education made by industry and the professions in the sustainability and development of Australia.

Principle 4: Recognition of the personal commitment of academics, technical and sessional staff to education of the next generation of leaders.

Q2.1 What are the best international measures of course quality that would provide appropriate benchmarks to inform judgments about the appropriate level of base funding for Australian universities?

Graduates from our Australian programs compete for employment across the world and conversely our disciplines typically support significant numbers of international students. It is

2 Alex Usher and Amy Cerenan, Global Higher Education Rankings: Affordability and Accessibility in Comparative Perspective 2005, Stafford: Education Policy Institute, 2005. www.educationalpolicy.org. This work sources Eurostudent 2000 3 EPI, p. 46. UTS faculty study with a survey response rate of 500 students has sought to quantify data on affordability of its courses. Expectations in these courses would be considered ‘normal’ amongst ADBED disciplines across Australia. 5 essential that Australia remains world competitive in its higher education courses. Many of our disciplines and international partner disciplines undertake accreditation procedures with national professional bodies. These bodies are coordinated internationally in order to enable the movement of professionals globally (architecture through Canberra Accord amongst Commonwealth countries including Canada and International Union of Architects [Union Internationale des Architectes, or UIA] representing over 125 countries and construction through the International Council for Building [Conseil International du Bâtiment or CIB] representing over 500 member institutions). Although accreditation measures are highly focused on the legal requirements associated with professional recognition they form a strong basis providing benchmarking proxy. In ADBED disciplines responses to accreditation protocols are used to drive increases in quality of degree offerings.

University rankings including Academic Ranking of World Universities by Shanghai Jiao Tong University, Global Higher Education Rankings, the Times Higher Education Rankings can provide some indicators of the international status of specific universities and how countries compare.4 While these do not drill down to individual disciplines they indicate the space, personnel and financial support provided for education internationally. Clearly there is currently no discipline specific measuring body for educational quality indicators.

For our disciplines, the best international measures of differing characteristics of course quality that would identify areas for improvement in funding in Australia are clearly defined by: * space allocation per student, * staff/student ratios, and * university provided technical facilities and their support.

ADBED analysis of these indicators across well-ranked institutions internationally suggests that in Design and Architecture disciplines SSRs are 1:15.5 In North American universities such SSRs are expected for Professional Accreditation purposes in Architecture. In Australia, both Design and Architecture disciplines have higher SSRs at 1:17 being the norm. When compared to more qualitative reviews, while SSRs are not a flawless indicator of course quality their proxy and international accessibility suggests that improvement is essential to maintain the status of Australia’s degree offerings.

Proxies for course quality that are internationally available, when compared to Australian averages in our disciplines, indicate that our courses struggle to remain internationally competitive. Student survey feedback reinforces the necessity in our disciplines for the inclusion of one-on-one teacher:student engagement especially in studio and workshop subjects. The above SSRs in Australian universities suggest a lessening of support for essential teaching modes in our core disciplines like Architecture and Design. ADBED strongly advises the Australian Government to benchmark our disciplines against countries supportive of design including Denmark, Korea, and the Netherlands to gain a clearer indication of expected support for quality education.

4 See their analysis in, Antony Stella and David Woodhouse, Australian Universities Quality Agency: Ranking of Higher Education Institutions, AUQA Occasional Publications Number 6, Melbourne: AUQA, 2006. 5 Study carried out by Swinburne University Faculty of Design. 6

Q2.2 What are the best international measures of student engagement that would provide appropriate benchmarks to inform judgments about the appropriate level of base funding for Australian universities?

If Australia is to remain competitive as an educator of Built Environment and Design disciplines the government’s commitment to base funding must remain equivalent to competitors in other world-competitive countries. Typically Australia looks to the Australian Graduate Survey coordinated by Graduate Careers Australia and benchmarked to the United Kingdom to form understanding of the quality of student experiences. Equally the AUSSE survey of student engagement has benchmarked educational fields at Australian Universities.

ADBED suggests that these indicators of student engagement do not correlate with quality indicators that are useful. They also do not correlate with the impact of cost of delivery in specific disciplines. For an understanding of the impact of base funding on student experience the shifting requirements of individual courses in having to make decisions on paying for upgrades in technology compared with staffing at a higher SSR must be taken into consideration. In our disciplines the studio, workshops of many types, group work and production spaces and their management contribute to the quality of student experience.

ADBED believes that the proxies of graduate satisfaction and attrition that have been used in the past do not provide clear guidelines for quality of experience or necessary cost of education in our disciplines. Within our disciplines, each student’s psychological commitment and investment in his/her learning can depend on a number of external factors as well as the learning support that universities extend. Wellbeing and a sense of belonging, fostered by such things as recognisable student cohorts, extra-curricular activities and informal student life on campus aids each student’s willingness to further commit to their learning.

International measures and benchmarks should focus on each government’s commitment to fund core education needs as well as extra curricular campus experiences, informal group learning and knowledge support in facilities such as libraries, open source technical workshops and student societies as a guide. ADBED believes that the full scope of learning experiences will need to be incorporated into base funding if Australia is to remain competitive.

Q2.3 Is there a system of higher education funding in another country that would be a useful benchmark model to inform Australia’s review of base funding?

ADBED believes that the current situation worldwide is volatile and very focused on the politics of short government terms. For ADBED disciplines a positive comparator can be found in those countries that support design, such as Denmark, Korea, and the Netherlands.

Q2.4 What is the connection between the level of base funding and quality outcomes?

In discipline areas that rely on considerable tacit knowledge, opportunities for project based work and peer learning are essential. Such opportunities are afforded by studio teaching and collaborative working. These, in turn, are enabled by facilities, suitable levels of technology and support for good learning outcomes, suitable staff:student ratios to achieve necessary learning experiences, and support for student and staff engagement. If this connection is not

7 understood and supported in base funding models it exposes our disciplines to potentials of impoverished outcomes and lack of international competitiveness.

Q3.1 Do the current funding relativities reflect the relative cost of delivering undergraduate courses in particular disciplines? What, if any, relative weightings should be afforded to various discipline groups and why?

ADBED strongly suggests that current funding relativities do not reflect the cost of delivery of our courses. ADBED believes that Architecture disciplines should be funded at a higher level and more closely reflect the costs associated with Engineering bands. In educational settings, our disciplines now focus on activity types mirroring environmental science and engineering that require our students to work in technology-enabled studios that are like the high-end workshops and laboratories seen in Engineering. Such technology-enabled spaces are necessarily staffed at a higher level with students requiring times of 1:1 consultation to progress their design, modelling, testing and prototyping outcomes. There is convergence with Engineering in our virtual labs; technology labs and the use of high end computer labs are in excess of Engineering. In 3d interactive labs, where building information modelling takes place, space and technical support is paramount. In construction disciplines, this new technology (fast being taken up by industry) models learning environments similar to those found in Architecture studios. In Architecture the testing and experimentation to enhance sustainability, 1:1 models and prototypes to understand new materials and the impact of technologies, will need technical support for infrastructure, guidance that is cost consuming, and space requirements not currently incorporated into funding models.

Additionally, our courses require strong financial self-investment by our students but do not have equivalent private returns in graduate earnings. To maintain internationally competitive delivery of degrees such as Architecture and Construction ADBED suggests a return of base funding to more equitable levels.

Q3.2 What are the costs to universities of improving the quality of teaching and the quality of the student learning experience at the undergraduate level and to what extent should they be reflected in the base funding model?

The costs of improving the quality of teaching and the quality of the student experience is considered in base-load funding through the reporting that universities do for mechanisms like AUQA and their self-accreditation processes. There is also the flow on from ALTC type funding that involves universities developing more specific projects around quality of teaching and student learning experiences. During 2010-11, ALTC has funded Discipline Scholars in Architecture and Construction who are formulating, through consultation, the expected graduate academic standards of these degrees. Such projects support the continuous refinement of quality issues in our disciplines. ADBED suggests that base funding retains support for these quality aspects in their future model.

Q3.3 What are the costs of engaging low SES students in undergraduate education? Should such costs be a factor in determining base funding? How might support for low SES students be maintained in the future?

Affordability to low SES students in ADBED discipline areas has the broadest implications for sustainability of their enrolment at university. ADBED has outlined the expectation of student self-funding responding to question 1.2 above. Affordability is impossible to achieve for low SES students without unencumbered financial support. Because of lower expectations 8 for graduate salary levels such support could not be in the form of loans.

At university level ADBED suggests that the range of costs associated with engaging low SES students is broad ranging. For universities there is a need for structured support mechanisms including assignment support and issues associated with students having to adapt to university from low SES high schools. The complexities of student experiences prior to university must not be underestimated. These may not be consistent with the self-directed learning models expected at university. Diagnostic testing and support for affecting change in student work habits and capacity to perform is a fundament sequence that must be understood as beyond the scope of classrooms.

Q3.4 What additional costs are involved in the provision of work integrated learning and should these be considered in setting the level of base funding?

Work Integrated Learning (WIL) is incorporated in our disciplines in many different ways. It can range from 20 days work experience arranged and supervised in industry collaboration with university staff, to models of WIL aiming for ‘collaborative’ learning for students whereby industry partners and universities form an association to deliver educational experiences over long durations. Professional Registration in some ADBED disciplines requires up to two years of work experience prior to sitting the registration examinations. Some of this experience can be undertaken on a full time basis whilst enrolled in university study.

The median approach to Work Integrated Learning taken by ADBED disciplines, is where elective subjects (unfunded or funded) are supported by academic administration and supervision. In a recent ADBED review of university members currently undertaking Work Integrated Learning, with suitable academic supervision and industry collaboration, cost estimation was approximately $300-$350/student enrolled. This was based on student cohort of average size of 700 students allowing some economies of scale. Ensuring the work experience is fruitful as a learning experience and engaging students in group discussion to bridge the gap between forms of higher academic learning and workplace learning demands significant staffing levels. Disciplines such as Architecture, Property Economics, Construction Project Management, and Planning emphasise the usefulness of Work Integrated Learning for their programs and encourage students to gain employment in their industry groups during their courses. The highlights of WIL are understood to develop in students many of the practices and skills that will be used in their university learning. ADBED would seek to gain government support for Work Integrated Learning in its degree offerings.

What is becoming recognised in health disciplines is the difficulty in many areas, and professional types, to access the necessary number of industry partners for effective WIL. Australia educates for an international market and it is often the case that businesses close to university communities and their residential feeder suburbs, do not include those needed for Work Integrated Learning. Impoverished work experiences do not add to student learning and students find it difficult when faced with inconsistent messages in their education. Disciplines like Landscape Design, Industrial Design, Fashion Design, and Visual Communications are industries often located outside CBDs and students find travel and experience difficult to incorporate in their university life. In these cases it becomes difficult for universities to guarantee placement that will suit students and the learning outcomes necessary to advance student knowledge, capability and skills.

Q3.5 What proportion of a higher education teacher’s time should be spent on scholarly activity and how could the costs of scholarship be included in the base funding model?

ADBED strongly suggests that the costs of scholarship continue to be covered in base funding. Scholarly activity is understood to be research associated with keeping up to date with advances in knowledge associated with delivery of curriculum in our disciplines. It is an essential attribute of academic life and should be supported in base funding. It also varies from academic to academic as they mature in their development of a portfolio approach to knowledge and delivery of subjects. Early Career academics may spend up to 50% of their time on the scholarship associated with preparing for lectures in their first year of delivery whereas mature academics may spend 10%. Without refreshing the knowledge and delivery methods associated with changing disciplines the content and methods embedded in our subjects and courses will soon fall behind international competitiveness.

Q3.6 Should any research activity continue to be supported by base funding?

ADBED strongly suggests that research activity continues to be supported through base funding. An academic portfolio is currently defined by a general ratio of time loosely summed in the 40:40:20 (teaching:research:administration) proportional approach to the academic year. While each individual academic may have different proportions, this ‘mean’ defines what defines an academic role. Academics also define their approach to delivering knowledge, skills and capabilities associated with their disciplines is a research led activity. While individual research strengths may not immediately mirror subject content it is the approach to learning that defines the strength of the academic approach. Since so much of our research is not funded by the nationally competitive agencies, in which the discipline relevant opportunities are slight, the funding must be found through teaching income. This is not a desirable situation but until the inadequacies of research funding are addressed there is no alternative.

Q3.7 Should infrastructure investment continue to be supported by base funding?

ADBED strongly suggests that infrastructure investment continue to be supported by base funding. As answered in Q3.1 and Q1.2 our disciplines are technology heavy. In educational settings, our disciplines now focus on activity types mirroring environmental science and engineering that require our students to work in technology-enabled studios that are like the high-end workshops and laboratories seen in Engineering. The depreciation costs associated with highly sophisticated equipment where equivalencies have previously only been seen in the better funded engineering disciplines cannot be absorbed; such equipment includes high numbers of high end computers, servers and software, three-dimensional (3D) plotters and large format printers (design and architecture), laser cutters (design and architecture), CNC Routers, Immersive 3D systems used with Building Information Modelling (BIM) (construction and architecture), 3D knitting machines and fabric printers (architecture and fashion), etc. This equipment is essential for ADBED disciplines to stay internationally competitive and to be able to educate the next generation of professionals for their international practice.

Q3.8 What other factors, if any, should be taken into account in determining base funding for teaching and learning in higher education?

No further comment. 10

Q4.1 Is there a higher relative cost for postgraduate coursework degrees? If so why is there a difference and what is the extent of the difference compared to an undergraduate degree in the same discipline?

Postgraduate education should be an experience in which a student builds and demonstrates a personal mastery on top of knowledge acquired in undergraduate studies. As such, the postgraduate experience requires more opportunities for the student to engage in developing individual strengths, exercising their ideas in critical discussion and having the opportunity to explore beyond a prescribed curriculum. Learning in our fields is best engaged in a studio context in which tacit knowledge can be brought out and the experience of collaborative activities and peer learning are supported. This in itself demands a lower student to staff ratio so that discussion can take place. There are also demands for more expansive access to tools and technologies in which to develop, exercise and refine such mastery. A more self-directed learning experience will also demand support for a wider range of experiences (placements, site visits, etc).

The cost implications are, therefore, to be found in the need for more staff for a given student body; more space in which to engage in studio learning and experimentation; more equipment and other assets to support the studio learning experience. It is likely that a properly funded graduate experience is 1.6 times the cost of supporting a properly funded undergraduate experience, accounting for staff, space, experience and equipment costs.

Q4.2 Are there other factors that contribute to the costs of postgraduate coursework degrees that should be acknowledged in the base funding?

In many ADBED disciplines including Architecture, and Design groups, universities now have specifically designated postgraduate technology-enabled studios and laboratories. This is because the time commitment at postgraduate level is high when compared with undergraduate, requiring many 24/7 accessible spaces. The expectations for student outcomes in many areas requires many hours of computer modelling, testing and experimentation and prototyping. This is a drain on current resources, as infrastructure needs almost double those of undergraduate levels per student.

Q5.1 Are there general principles that should determine the maximum contribution a student should make towards the cost of their education in a publicly funded higher education system?

ADBED believes that accessibility to education should be the driving principle. Graduate salaries in our disciplines cover a very broad scope and cannot be equalled to ‘capacity to pay’ when amalgamated in broad Fields of Education categories.

Q5.2 In what circumstances should the level of students’ contribution towards the cost of their courses be based on factors other than the cost of their tuition?

Cost of tuition is a very limiting guide to student contribution. Many of our disciplines are expensive to provide and yet there is expectation for low graduate salaries. To exclude these disciplines would impoverish the Australian community, its culture and future development.

Q5.3 Should the basis for determining the level of contribution by the student towards the cost of their tuition be different at the postgraduate level?

ABDED agrees that for some disciplines (Property Development, Construction Management) postgraduate education is undertaken by students to improve their capacity to earn in a context of high remuneration for service. Other postgraduate education is associated with professional entry and is of a general (eg. Architecture) or specific (eg. Lighting Design) type. These postgraduate qualifications do not necessarily provide the same financial returns on graduation. Judgements about what students can contribute to their education should be sophisticated enough to recognise such differences.

ADBED suggests that costs of tuition at postgraduate level should recognise the multiple levels of graduate remuneration from entry level to maturing levels of remuneration. The government should also continue to support students in those disciplines that do not provide strong graduate salaries such as specific design disciplines.

Q6.1 To what extent does the base funding model provide incentives for institutions to invest in and deliver high quality teaching?

The opposite is the case. There are no current built-in incentives to invest in and deliver high quality teaching. Universities’ self management through Vision Statements and Strategic Plans strive to provide contexts for continuous improvement. Specific disciplines, contextualised by their professional environments understand change and strive to provide graduates who will be equipped with the necessary new knowledge, skills and capabilities to be internationally competitive. This structure of self governance and continuous review to ensure quality is the basis of university education.

Q6.2 Does the base funding model provide incentives for institutions to maintain strong academic standards?

ADBED believes that through reviews carried out by Australian University Quality Agency and the Australian Tertiary Education Quality and Standards Agency the government provides the context for deployment of a proportion of its base funding. ADBED suggests that this is continued.

Q6.3 What features could be incorporated in the design of a new base funding model to make it more simple, transparent and responsive to higher education providers?

ADBED would suggest that if the bands of base funding are to remain that a review of descriptors of sub-bands be undertaken. Recognition of changing financial pressures on specific disciplines must be incorporated into new categories. There is a strong feeling that specific courses in Architecture, Construction and Design disciplines are being disadvantaged in the context of significant change in content, technical infrastructure supporting learning, delivery modes and space requirements. Shifting costs to our students has been too great a burden for low SES or middle-income students to aspire to stay within our courses.

FACULTY OF DENTISTRY UNIVERSITY OF SYDNEY SUBMISSION TO BASE FUNDING REVIEW

Introduction

The Faculty of Dentistry welcomes the review of base funding for higher education and requests that this report be given due consideration. This report demonstrates that base funding for dentistry and oral health therapy courses is inadequate and consequently dental education and research are unsustainable as currently funded. This is inconsistent with the Government’s strategy of increasing access to dental education and research by increasing from five to nine dental schools in Australia over the past seven years. Funding for dental higher education needs to be increased to ensure that dental academia remains viable in Australia.

Nature of dental education and training, accreditation and registration

Oral Health is fundamental to overall health, wellbeing and quality of life. The University of Sydney has been meeting the dental needs of the community through dental education and research for over 100 years.

Graduates of dentistry courses are required to deliver a comprehensive scope of dental procedures at a high level of patient safety without supervision. Few other professional training courses require this. Consequently dental education is expensive although arguably the Australia gets very good value for money through world class dental care and research. Dental graduates contribute substantially to the economy through delivery of services and employment (e.g. one dentist will typically employ a dental assistant, administrative assistant and support a dental technician).

Quality outcomes in dental education are prescribed and assessed by the registering body (Dental Board of Australia). Dentistry students perform irreversible and potentially life threatening invasive procedures on human patients. Patient safety is at all times the critical issue. Consequently, dental education requires high staff-student ratios, quality pre-clinical training and quality clinical supervision provided by academic staff, whom need to be experienced clinicians, to minimize the risk of serious patient injury.

“Competency” as defined by the Australian Dental Council encapsulates knowledge and clinical experience. It is not sufficient for dental schools to demonstrate only that students are able to perform a tooth extraction or other invasive dental procedure if they have only observed one being performed by a clinician or have personally performed only one or two such procedures during their course of training or if they do not understand the science behind the clinical procedure performed. The same applies to the range of other clinical procedures which are required for registration. If there is insufficient funding to provide the quantity and quality of clinical experience which students are required to master for registration, then the dental program will not meet accreditation standards.

Resource requirements for the training of dentists and oral health practitioners

The Faculty of Dentistry believes base funding should cover teaching, faculty and University administration, research, student services and amenities and infrastructure. As a result of previous inadequate base funding, many dentistry costs are sourced from non-federal government sources and are difficult to obtain. Consequently in our current costing evaluation, not all of these costs could be included and thus the calculated costs are lower than the real cost of delivering the courses.

Dental schools maximize the use of simulated learning environments. However, real clinical experience is required for registration. In clinical settings, for every four to six students, a

Faculty of Dentistry submission to Base Funding Review page 1

clinician is required (who is a dentist or dental specialist) who, at Sydney University, is in most cases employed by the university. This applies to the dentist and oral health therapist training. There is a clear difference with respect to resource requirements between this mode of learning experience and, for example, a lecture provided for a larger number of students where assessment material is distributed to students to conduct in their own time with minimal guidance using online library facilities. Dentistry degrees require this form of learning experience for students in addition to expensive pre-clinical and clinical training.

There exists a natural flow on effect from securing the appropriate level of funding for dentistry and oral health therapist training - funding enables not only appropriate education but investment in research active academic staff which raises the profile of the Faculty and University and which then in turn attracts higher calibre staff in addition to students for general practitioner and specialist degrees.

Apart from being a requirement of NSW Health, it is difficult to contest close student supervision levels. With a lower student to staff ratio, achievement of dental competencies by students is facilitated. It enables a higher number of procedures to be performed, a higher number of patients to be treated in a safe environment and expensive equipment to be utilised more cost-effectively. Moreover, if an adverse event occurs, a qualified clinician can immediately step in and provide the necessary assistance and protect the patient.

Patient safety is paramount. Clinical audits suggest that there is a greater probability of adverse events during dental treatment among low socio-economic status patients who are dependent on government health services and who are the patients being treated by students at Sydney University.

In addition, in order to provide these essential clinical experiences, infrastructure such as dental chairs, x-ray machines, sterilising machines and other expensive instrumentation and consumables are required. These costs are co-funded by the University and NSW Health but in some jurisdictions, these costs are borne solely by universities.

The costs of dentist and oral health therapist training are analysed in detail in the report produced for the Australasian Council of Dental Schools by the accounting and consultancy firm, KPMG as part of the Base Funding framework. Most important is the estimate of a cost of $33.9K per annum to train a dentist and $34.5K per annum to train an oral health therapist at Sydney University. These costs to Sydney University are 20.5% and 22.9% higher respectively than the current Commonwealth allocation for Cluster 8 which applies to the Faculty’s units of study.

Students from low SES backgrounds

The Faculty of Dentistry at Sydney University aspires to enrol and educate more students from low socio-economic backgrounds and this aligns to the universities purpose. The Faculty aims to create and sustain a university in which, for the benefit of both Australia and the wider world, the brightest researchers and the most promising students, whatever their social or cultural background, can thrive and realise their full potential. Adequate higher education funding is essential to achieve this aim.

Specialist training and resource requirements

Postgraduate coursework programs in Dentistry are designed to train specialists who respond to the referral of patients where general practitioners are unable to manage the necessary clinical requirements. In a public hospital system as in NSW, the expenses associated with specialist treatment are not administered on a user pays basis and there is a level of subsidy from the Faculty (though this is not well quantified). The delivery of an appropriate level of coursework education and training and the achievement of appropriate clinical and academic

Faculty of Dentistry submission to Base Funding Review page 2

standards is an expectation of accreditation. This is also a direct reflection of community needs for the provision of advanced services for complex care.

For the Faculty’s postgraduate programs, peer review in addition to accreditation define standards of coursework content, clinical experience (breadth and depth) as well as research requirements. For example, in the Faculty’s postgraduate discipline area of Prosthodontics, these factors are very demanding with complex and expensive oral rehabilitation cases as a regular and expected requirement for clinical experience, in addition to laboratory requirements including expensive commercial laboratories.

In addition to clinical learning, online learning is an important component for information delivery and course management at the postgraduate level. However, face to face learning is also required for the clinical coursework specialty programs and involves case discussions in treatment planning and monitoring which is facilitated by clinical tutors and which has cost implications.

The expectation from specialist postgraduate programs is for graduates to be competent to manage the complexities of tertiary referral treatments. The range of treatment needs is broad including genetically inherited diseases and deformities, maxillofacial prosthodontics following cancer surgery, trauma and similar challenges, which are beyond the coursework requirements of general practice degrees.

Alternative models

An alternative health provision system of user pays exists in other countries including the USA and Canada where there is no comprehensive public health system. Australia’s health system evolved from, and is similar to, that in the UK. However, in the UK, the National Health Service (NHS) provides comprehensive funding for hospitals and university clinical programs. In addition, there is full integration within the teaching hospitals where hospital staff (using the consultancy model) contribute to teaching and research whilst having a primary responsibility for clinical service. University staff (using the professional model) contribute to clinical service whilst having a primary responsibility for teaching and research. Intrinsic to this model is a structure whereby the academic head (dean) is the senior manager of the health unit. This ensures integration across the systems without conflict of interest or demarcation with patient care, teaching and research. The overall result is that the sharing of resources and responsibilities is optimized and this may be a model for consideration in the Australian context. If considered for Australia, this model could serve as a catalyst for the maintenance of standards and greater efficiency in service and teaching.

Research

The Faculty of Dentistry understands the need to enhance its research credentials and performance. However, for many staff, there is insufficient time to dedicate to research as time is given to teaching, clinical supervision, clinical assessments and administrative work. It is estimated (and recorded as part of a workload analysis exercise) that these learning related activities constitute 80% of the workload of academic staff. In the light of the required level of intensive training for graduating students to register with the Dental Board of Australia, a concern is that research will not progress in line with other faculties which may possess a relatively higher level of discretion to modify learning experiences rendering them more cost effective without compromising registration requirements. If resources were to be directed to research in the current context, the Faculty may become a liability to the co-hosts (local health networks) who in turn may not permit the students to train on their patients.

Horizon issues

Consideration needs to be given to the relationship which the Faculty has with NSW Health. Whilst the Faculty and NSW Health have a very strong working relationship, the State’s Chief

Faculty of Dentistry submission to Base Funding Review page 3

Dental Officer has informed the Faculty of significantly increased charges for utilization of public facilities. Other potential issues include:  a further diminution of clinician contributions from NSW Health;  a widening of the differential between clinician remuneration in practice and employed by NSW Health (e.g. $174-215K range for staff specialist) versus university salaries (e.g. $103-160K range for Snr Lecturer-Professor) which renders it more difficult for universities to attract quality and the best staff and for any form of equilibration to be achieved between these remuneration levels;  decreasing participation in clinical education from external dentists who have historically provided these services on a pro bono basis; and  additional charges for the provision of practicum or placement opportunities for dentistry and oral health practitioner students.

The government contribution component of higher education funding is currently indexed using a composite indexation rate based on the labour price index and consumer price index. It is maintained that this indexation methodology is not commensurate with the relatively higher inflation rate which exists within NSW Health. Accordingly, the funding allocated to the University to train dentists and oral health therapists does not match the increase in costs to which the University is exposed (to a significant level in NSW) as a result of providing this training.

It is evident that with a continuing increase in costs over the next five years without commensurate funding support, particularly in the light of the introduction of the Doctor of Dental Medicine with a higher number of hours dedicated to clinical practice, the Faculty may become non-competitive nationally and may not be in a position to claim international equivalence. This would undermine the professional reputation of the Faculty’s programs and international student numbers (on which the Faculty depends significantly) may be affected.

Professor Chris Peck Dean, Faculty of Dentistry The University of Sydney 31 March 2011

Faculty of Dentistry submission to Base Funding Review page 4

Rosanne Taylor Dean, Faculty of Veterinary Science

31st March 2011

Secretariat Higher Education Base Funding Review Box 9880 CANBERRA ACT 2601

Dear Sir/Madam,

I am writing to advise that for the Base Funding Review, the Faculty of Veterinary Science will not be able to provide a final submission by 31 March 2011. We intend to provide our Faculty submission by April 8.

The submission to be provided by Veterinary Faculty will complement that prepared by the Australian Veterinary Deans, documenting the real costs of veterinary (especially clinical) training to meet the demands of domestic and international accreditation agencies and the pro bono support from the profession to partially alleviate chronic underfunding of undergraduate instruction.

My colleagues and I would be very happy to discuss any aspects of the submission with the Review.

Yours sincerely,

Rosanne Taylor Professor and Dean

Dean’s Office T +61 2 9351 6936 BN 15 211 513 464 Faculty of Veterinary Science F +61 2 9351 3056 CRICOS 00026A Room 204, JD Stewart Building B01 E [email protected] Camperdown NSW 2006 Australia

Rosanne Taylor Dean, Faculty of Veterinary Science

8 April 2011

Dr Jane Lomax-Smith Chair, Higher Education Base Funding Review By email: [email protected]

Dear Dr Lomax-Smith

The University of Sydney’s Faculty of Veterinary Science welcomes the opportunity to make a submission to the Higher Education Base Funding Review.

We seek to provide views, data and other information specific to the discipline, and to the Faculty as a vitally important part of Australia’s animal and human health system. In doing so we hope our submission assists the Review Panel to understand the significant challenges Australian veterinary schools currently face, we believe, largely as result of inadequacies in the base funding for the field.

Our submission includes three appendices of supporting data and other information. The first of these is marked ‘Commercial-in-Confidence’ as it includes internal costing and budget data about the Faculty. In this letter we have sought to address the following issues:

1. The complete inadequacy of the current base funding levels for veterinary science education. 2. The threat this poses to maintenance of international standards for veterinary education. 3. The particular cost burden of operating veterinary teaching hospitals. 4. The cost of meeting accreditation requirements for ‘practice ready’ graduates with a diverse range of professional, technical and clinical competency. 5. The impact of declining interest and support from state governments for the sustainability of veterinary education and research in Australia. 6. The actions we have taken at the University of Sydney to sustain quality in the face of enormous funding pressures as a result of inadequate base funding and other developments. 7. The limited capacity of Australian veterinary students, particularly from low SES, regional and rural areas, to pay more for their education. 8. The overall importance of veterinary science to the future of animal and human health in Australia.

I conclude by offering three short term and two longer term recommendations for consideration by the Review Panel. These are designed to provide the discipline with immediate relief, but also to ensure that the Review results in governments, Federal and State, taking a longer term view about how to sustain veterinary science capacity in Australia.

Dean’s Office T +61 2 9351 6936 BN 15 211 513 464 Faculty of Veterinary Science F +61 2 9351 3056 CRICOS 00026A Room 204, JD Stewart Building B01 E [email protected] Camperdown NSW 2006 Australia

Base funding levels are inadequate

Our basic argument is that the level of base funding provided to support veterinary education in Australia has been recognised as inadequate, but has not been addressed, for at least a decade. As a result, we believe that Australia now faces a looming crisis in the capacity of its higher education sector to continue to sustain veterinary education at international standards of quality. While a number of factors have contributed to the current state of affairs, we believe that the challenges the discipline faces are due primarily to the large and growing gap between the level of base funding provided for veterinary science, and the actual costs of providing veterinary education at the standard required to ensure animal and human safety.

As recently as 2007 an independent study undertaken by Access Economics for the former Department of Education, Science and Training (DEST) confirmed that the average cost per student of delivering veterinary education exceeded base funding in all veterinary schools included in the sample.1 This finding was consistent with the findings of the Review of Rural Veterinary Services Report undertaken by Peter Frawley in 2003 jointly for the Commonwealth Department of Agriculture, Fisheries and Forestry and the former DEST.2 It is also consistent with the findings of various external reviews undertaken of our Faculty over the last decade. For example, in his 2001 Review of the Faculty the now Provost and Executive President of Washington State University, Professor Warwick Bayly, reported that:

‘...The current level of recurrent funding support for the Faculty in general, and the clinics in particular, is abysmal by any standard—Australasian, British, American or Canadian. The University of Sydney’s Faculty of Veterinary Science has the lowest per student FTE funding of the 42 veterinary schools in this group...’3

More recently, in their 2011 report on veterinary clinical teaching in the Faculty, Dr Lizette Hardie, Head of the Department of Veterinary Clinical Science and Dr David Bristol, Acting Dean from North Carolina State University College of Veterinary Medicine found the resourcing differential between veterinary schools in Australia and those in the United States to be alarming:

‘The comparison of 35K/student/year vs. 65-80K/student/year in the US was jolting. This difference will limit the faculty resources, technical help, equipment and supplies. The areas I would anticipate being impacted the most would be laboratories and the teaching hospital, since these are resource intensive.’ 4

As Frawley noted in his 2003 Report, veterinary science education is one of the most expensive fields of education, with the costs borne by education providers higher than for other fields because of the nature of the discipline and the historical reliance on the in-house provision of clinical training in veterinary teaching hospitals:

‘The teaching of veterinary science is high cost, requiring the type of intensive, small group teaching and clinical experience also found in medical schools. Numerous veterinary biological subjects and clinical specialities must be taught requiring a comprehensive range of qualified staff. In addition veterinary science requires hands on access to animals in laboratory as well as clinical, hospital and field settings, which results in a significant increase in the cost per student, vis-à-vis other courses (including medicine). Veterinary Schools do not benefit from a public funded hospital system, as medical schools do, and must maintain their own clinical and hospital teaching facilities.5

1 Access Economics, Higher Education Cost Relativities and Pipeline, 2007, pp.5-6 2 Frawley P, Review of Rural Veterinary Services Report, January 2003, p.51 3 Bayly, EW, Fellowship review of veterinary clinical teaching at the University of Sydney, 2001 4 Hardie L and Bristol D, IDPF funded Curriculum and clinical teaching review, 2011, p.1 5 Frawley P, Review of Rural Veterinary Services Report, January 2003, p.49

In confidential Appendix 1, we have provided a range of costing data and other information, which we believe substantiate our claims that base funding for veterinary science currently falls well below the reasonable actual costs of providing veterinary science education of standard that is internationally acceptable and competitive. The appendix includes international benchmarking data of revenue levels per student at veterinary schools in the United States, Canada, the UK, Norway and elsewhere. It also includes the results of an internal costing process we have undertaken recently from which we conclude that our average teaching costs are $36,889 per student each year, substantially above the base funding received for each place of $28,622. This is the current actual cost, and does not include the cost of supporting the 38 weeks/student of compulsory extramural training in animal husbandry and veterinary clinical practice which is currently met largely, pro-bono, by farmers and the veterinary profession, a substantial concern for the unsupported costs it imposes on the profession.

Maintaining veterinary teaching hospitals

One of the discipline’s key cost drivers is the requirement that all graduates must be ‘omnicompetent’ and ‘practice ready’ in multi-species veterinary practice at registration. Veterinary training exceeds the costs of other health and agricultural disciplines because it requires individual supervision of students undertaking technically demanding, invasive procedures on live animals, with attendant risks for staff, students, clients and animals. Procedural competence must be demonstrated for all graduates in animal handling, diagnosis, imaging, anaesthesia, medicine, surgery, pathology, food safety and veterinary public health. This can only be achieved by learning and assessment of students working with animals in expertly supervised clinical and farm-based practical classes and through students taking responsibility for clinical cases in university veterinary teaching hospitals. The costs are high, with numerous costs imposed in meeting the regulatory requirements for OHS, Animal ethics, veterinary services legislation.

In the United States and elsewhere, the costs of sustaining veterinary teaching hospitals are met either in full or part by state governments. While this model has been the convention in Australia for the provision of clinical training in the human health disciplines, this has not been the case for veterinary medicine. In Australia, in order to provide the learning environment required to meet accreditation standards, veterinary schools have historically operated veterinary teaching hospitals themselves. Some of the newer veterinary schools are pursuing alternative models of delivering clinical training, for example, by seeking access to existing hospitals, or relying on private practices. This is not considered a viable option at the University of Sydney at present, however, as it would create a high risk to our capacity to ensure quality delivery.

The requirements of student instruction, student-client interactions, clinical specialty training of future academics and clinical research increase animal case completion times by three to four times, while space, equipment and consumable requirements estimated at two to three times that of private practice, combine to render veterinary teaching hospitals financial unviable without cross-subsidy. Over the period 2006 to 2011 the Faculty’s hospital has required funding supplementation from the University ranging from $704,000 to $1.75 million, escalating to over $4m when space occupancy charges are included.

Confidential Appendix 1 also contains data demonstrating the cost and budget challenges faced by the Faculty in order to maintain it teaching hospital.

Declining state government involvement

Over the last decade or more Australian veterinary research has faced significant declines in the value of state government support. This has resulted largely from the contractions that have occurred in rural veterinary services, which have traditionally been the domain of this level of government. Examples include the closure of veterinary diagnostic services in state agriculture departments, reduction in ‘On- Plant’ veterinarian numbers (food safety public practice) and the rise of fee-for service for research and student training in government veterinary laboratories. Improving the base funding for veterinary science education is an important element of the reform that is required.

Achieving meaningful long term solutions to the broader quality and capacity issues facing the discipline will, however, require governments – federal and state – coming together with the profession, industry, farmers and universities to develop collaborative strategies, which ensure that responsibility for safeguarding the future of animal and human health in Australia is shared appropriately. This includes responsibility for sharing the costs, in the national interest, of educating the next generation of veterinary practitioners and research scientists.

Maintaining quality

Non confidential Appendix 2 contains data and other information demonstrating that despite the significant resourcing challenges the Faculty faces, on all available measures of teaching and learning quality, we continue to perform very well, with outstanding student satisfaction, retention, employment rates, and efficiency. We contend, however, that we have only been able to keep our standards at acceptable levels as a result of our ability to substantially increase fee income from international students (and domestic students until 2007); by increasing our enrolments; by relying more heavily on the pro bono contributions of the profession in public and private settings and on farmers for animal handling; by increasing revenues received through philanthropy; by imposing greater teaching and clinical training workloads on staff that reduce their capacity to undertake research and progress their careers; and by seeking to reduce costs wherever possible.

Despite these efforts, the high costs, particularly of maintaining a veterinary teaching hospital, have meant that the Faculty has relied upon contributions from the wider University to sustain its operations. In 2011 the cross-subsidy to the Faculty from the University is estimated to be $7.37 million or $10,000 for every Commonwealth supported student enrolled in a unit of study within the Faculty. If enrolments of international students continue to decline in 2012 and beyond, as is widely expected at present due to the rise in the Australian dollar, increasing international competition, and other factors, our financial position will inevitably deteriorate further unless further savings can be found.

Students have limited capacity to pay more

While we believe that the case for increasing base funding for veterinary science education is undeniable, we do not believe that Commonwealth supported students have much more capacity to contribute more to the overall costs. Compared to graduates in many other professions, Australian veterinary science students already leave university with relatively large debts and low income earning potential. Starting and continuing salaries for vets in Australia are low relative to other professions and appear to be falling in relative terms. Eighty percent of veterinary graduates are now female, and on average they receive less than 80 percent of male rates of pay. Career earning potential is therefore quite modest compared to many other professions. Moreover, in the near term the supply of veterinary graduates appears likely to exceed demand, with 50 per cent more students expected to graduate annually by 2013 compared to 2008 as a result of increasing enrolments and the opening up of three new veterinary schools. This trend is expected to place downward pressure on the earning potential of new graduates entering the profession.

The salaries available to most veterinarians in Australia, but particularly in rural and regional areas, do not compare favourably with those available in other developed countries. Substantial incentives already exist for students to move overseas after graduation in order to earn higher incomes and gain valuable experience, while global accreditation arrangements facilitate such mobility. Losing any Commonwealth supported students to overseas markets is an economic and social loss to the nation, but the loss is compounded if the students have deferred their HECS liability and never return to Australia.

Beyond the students’ contribution to base funding, which can be deferred through HECS, students face substantial incidental and opportunity costs in order to complete their studies. For example, they must meet travel and living costs associated with spending time rural and remote locations in order to complete their practical training. In addition, it is an accreditation requirement for students to satisfy the 38 weeks of compulsory animal, industry and clinical experience undertaking these placements during semester breaks – thus forgoing the opportunity to earn income during these periods.

Non confidential Appendix 3 provides information relevant to the capacity of domestic veterinary science students to pay more towards the costs of their tuition.

The importance of veterinary science education and research to the nation

The contribution veterinary science makes to the needs of diverse animal species and people means it arguably the most diverse of all the health professions. Veterinary science safeguards animal health, animal welfare, and food production for human consumption. As a consequence of the quality of care given to all kinds of animals, veterinary science promotes human health, welfare and well-being. The veterinary profession protects the security of our domestic food supply and international trade from the risks associated with animals, animal products and zoonotic disease. Australia’s veterinary science schools are repositories of knowledge, but they are also key generators and translators of new knowledge, understanding and workforce capacity that are vital to sustaining and improving the profession’s the capacity to safeguard human and animal health in Australia. We remain particularly concerned for the high cost and impact on the veterinary profession of provision of pro bono clinical training, a contribution which has grown over the past decade in numbers of students, academic requirements for quality of programs, and expectations for level of procedural competency students must develop and demonstrate.

Recommendations

The Faculty of Veterinary Science at the University of Sydney recognises that the Base Funding Review Panel has been set a very difficult task, and may not have sufficient time to consider the particular challenges and issues facing every discipline that feels it requires urgent attention.

Nevertheless, we believe that the weight of past studies, reviews and any international benchmarking of relative funding levels, demonstrate clearly that a sizeable gap remains between the level of base funding provided under the current funding clusters and the reasonable costs of delivering veterinary science education at international standards of quality.

Our sincere hope is that even if the Review does not result in immediate funding relief for Australian veterinary schools, it will at least provide an outcome which provides the discipline with a clear pathway forward towards an operating environment that is more realistic and sustainable. From the Faculty’s perspective, under the University’s current strategic plan, we have been given five years to find ways to balance our budget. Beyond that timeframe there are no guarantees that the University will continue to cross-subsidise our operations. While we will be continuing to explore all options to increase revenues from alternative sources and reduce to reduce costs, after more than a decade of taking such action, there is a limit to what our staff, students and infrastructure can bear.

In this context we make the following recommendations:

Short term:

1. Lift base funding for veterinary education through:

a. Increasing the CSP funding rate by $8,000 per student.

b. Providing a clinical training supplement of $15,000/year for the clinical years of veterinary programs, to provide for partial support of University Veterinary Teaching clinical training of undergraduate and specialists and the cost of the equipment used.

c. Introducing a rural training supplement of $2,000/final year for students to offset costs of rural placements – available to local students.

2. Offer HECS repayment relief fellowships for 5 years to graduates who remain in rural practice undertaking more than 50% of their work on livestock. This is an inducement for graduates to practise in regional areas where business returns are lower by urban standards.

3. Provide a tax break for veterinary practitioners contributing time and resources to clinical teaching, particularly rural veterinarians, at the rate of $500 per student placement of four weeks.

Longer term:

1. Recommend that a national review of the structure and delivery of Veterinary Education and research be undertaken by COAG. Taking the Frawley report of 2003 as a starting point, a long-term collaborative approach needs to be developed and implemented as a specifically targeted process for determining funding for veterinary education and future research capacity, which recognises the real cost structures associated with the delivery of veterinary education. A national review, overseen by appropriate COAG committees, would be an appropriate first step in the process.

2. Invest in rural training hubs that provide temporary housing and pastoral care for multi- disciplinary rural trainees (veterinary as well as medical, dental, pharmacy, nursing).

Yours sincerely

(Signature removed for electronic distribution)

Professor Rosanne Taylor Dean, Faculty of Veterinary Science The University of Sydney

Appendices

Appendix 1 COMMERCIAL IN CONFIDENCE - Costing and international benchmarking

Appendix 2 Maintaining teaching and training quality in the BVSc at University of Sydney

Appendix 3 Additional costs for students - Financial and opportunity costs for undergraduate veterinary students

Appendix 2

Maintaining teaching and training quality in the BVSc at University of Sydney

This non- confidential section provides data which details Faculty efforts to preserve and maintain teaching quality while identifying and implementing initiatives to increase revenue streams or reduce costs.

2.1 Generation of additional revenue to maintain teaching quality. Faced with resourcing challenges, the Faculty has sought alternative funding streams to maintain the quality of veterinary training, As mentioned in appendix 1, extramural rotational placements for the practical instruction of year 5 students as well as animal handling has been negotiated with the profession and industry and is valued at more than $2.34m for USyd students alone.

2.1.1 Increasing revenue from student numbers Additional revenue has been generated by maximizing fee paying students within the limits of the facilities available:  Increase in student numbers (45% up since 2000) within existing facilities (Figure 1)  International fee income (300% increase in student numbers since 2000 and 102% increase in tuition income since 2005) (Table 1)  Domestic tuition (declining since cessation 2007)

Figure 1. Student EFTSL in the BVSc has increased by 45% over the past decade

Faculty L&T Income vs Student Load

20,000 1,000

16,000 800

12,000 600

8,000 400

4,000 200 Student Load (EFTSL) Load Student Faculty L&T Income ($'000) 0 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Faculty L&T Income Student Load

Table 1. Comparisons of domestic and international student fee income at FoVS

2007 2008 2009 2010 $'000 Actual Actual Actual Actual USyd Domestic Fee Income 3,879 3,667 2,800 2,203 USyd International Fee Income 4,758 5,446 6,415 7,205 USyd Total Student Fees 8,636 9,113 9,214 9,407

2.1.2 Increasing business income from Teaching hospitals

The Faculty and University have invested in facilities, staff, business management and marketing to maximize the revenue from veterinary teaching hospitals. As shown in Table 2, the University

investment of $11.6m over 3 years in facilities, equipment, staff has realized a 110% increase in the University Veterinary Teaching Hospital Revenue (2005-$4.402m pa to 2010-$9.720m pa). However increased business income does not equate with profit or operating margins (Appendix 1, Table 3).

Table 2 FoVS business income from the Veterinary Teaching Hospitals (VTH)

‘000 $ 2005 2006 2007 2008 2009 2010

Business income 4402 4736 5010 5939 6904 9270

2.1.3 Growth of new postgraduate coursework and research training programs by 130% over the past decade

2.1.4 Energetic pursuit of philanthropy

The Veterinary Science Foundation is the Faculty’s development arm. Since its establishment in 2000, the VSF has raised more than $9.9m with direct co-investment in Faculty infrastructure ($4.7m) and support for education programs ($0,78m). From 2004-2008, the total expenditure on Faculty support from philanthropy was $13.4m, an average contribution of $2.68m pa.

2.1.5 Degree offering diversification and cross subsidization

Introduction of the Bachelor of Animal Veterinary Biosciences (BAVBS) degree has been a highly successful addition to the Faculty’s teaching expertise and operating margin. The BAVBS program is also a high-cost program ($28,038/student versus $28,094/ vet student), requiring access to animal, farm and laboratory facilities. However it is more sustainable, as it does not have the unmet costs of clinical training.

2.2 Reducing total teaching costs by partnering with the profession and Industry

Currently, the profession provides nearly half of the required clinical training on a pro-bono basis and we have solicited farmers to provide the majority of animal handling experience. The annual estimated pro bono veterinary contribution to clinical training (26 weeks) exceeds $1.89m pa; calculated from  26 weeks x 140 students x 20% of 1 veterinarian @ $85,000pa  26 weeks x 140 students x 20% of 1 nurse @ $50,000pa  consumables @ $280,000pa ($2000/student x 140 students)

The annual estimated pro bono farm experience contribution to animal handling experience (12 weeks) exceeds $210,000 pa (12 weeks x 140 students x 10% 1 farm owner x 12 weeks @$70,000pa)

The total pro bono contributions (estimate) is > $2.34m pa

2.3 Quality of training is assessed internally and externally

Regular visits to the Faculty by domestic and international accreditation bodies ensure that the specified standards of facilities, curriculum, case-load quantity and quality are met. Additional measures of quality instruction come from extramural (private and government) veterinary practitioners who report high levels of confidence in student’s skills and readiness to graduate during their final year clinical placements (Table 3). This is consistent with intramural supervisors’ assessments.

Table 3 External assessment of final year veterinary student proficiency in 2010

Overall All Small animal Rural mixed Rural public evaluation placements practice practice practice

Unsatisfactory 0% 0% 0% 1%

Marginal 2% 5% 1% 0%

Satisfactory 18% 22% 25% 3%

Proficient 51% 47% 44% 67%

Outstanding 29% 26% 30% 29%

In addition, graduating students provide positive feedback on the quality of training when surveyed in their second year after graduation (Table 4). Surveys also found high employment rates for graduates (91% in full time work, 16% full time study within first year of graduation (Graduate Destination Survey (GDS) - http://www.itl.usyd.edu.au/ceq/reports.cfm - 2008 data)

Table 4 Graduate experience of veterinary education in FoVS

Agreement % 2008 2009

Good Teaching 87 79

Generic Skills 85 94

Overall satisfaction 88 94

Source: Graduate Destination Survey (GDS) - http://www.itl.usyd.edu.au/ceq/reports.cfm

Appendix 3

Additional costs for undergraduates - Financial and opportunity costs for undergraduate veterinary students

3.1 Undergraduate costs

Due to the intensive prescribed BVSc curriculum, there are substantial course costs for students for tuition and instruction. These include fees of $8,859 pa, with additional costs of protective clothing, instruments, accommodation (all years but particularly yr4), travel and catering at placements (yr5) and totaling around $19K per student over the degree. In addition, vacation placements for compulsory animal and industry experience as well as clinical training across successive years of the degree account for an opportunity cost for part-time employment of around $56K. This consists of $16,562 loss of earnings by vacational placements in Yrs 1-3 (18 weeks x $1274 pw); Yr 4 rural campus ($19,656) and extra-mural placements in Yr5 ($19,656- 15h/wk x 36wks) on ABARE figures (http://www.abs.gov.au/ausstats/[email protected]/mf/6302.0 ).

In addition to HECS and graduate incomes which are lower than other professions, this substantial impost on new graduates and an incentive to move overseas and to avoid areas or sites of lower income (i.e. regional areas) creating local shortages and possibly lead to a chronic shortage of production animal veterinarians (Frawley, 2003).

The cost of veterinary education and associated expenses are similar in Australia and in North America. An example from the University of California Davis (2011) is shown below in Table 1: http://www.vetmed.ucdavis.edu/studentprograms/subpages/admission_info/cost.html

Table 1. Expenses of the Veterinary degree at UC Davis 2011

1st Year (10 2nd Year (10 3rd Year (10 4th year (12 months) months) months) months) Registration Fees $30,246 $30,246 $30,246 $33,720

Books & Supplies $3,856 $2,247 $3,385 $4,457

Housing $9,385 $9,385 $9,385 $11,262 Food $3,794 $3,794 $3,794 $4,553 Personal $2,419 $2,419 $2,419 $2,904 Transportation $1,831 $1,831 $1,831 $2,196 TOTAL $51,531 $49,922 $51,060 $59,092

Out of state tuition is $12,245 per academic year in addition to above fees- no extramural places

At Tufts University (http://www.tufts.edu/vet/admissions/tuition.html). Years 1-2 costs >$60,000 pa (with tuition), while Years 3-4 cost >$62,000 pa (including living expenses of $21,000 pa).

3.2 Post graduation salaries and earning capacity. BVSc graduates average 24 years of age at graduation with an expected working life of 36-40 years to recoup a return on investment in training. Their expected salary after graduation ($45K) is less that other graduates ($49K), having fallen behind over the past 2 decades. By comparison, the median starting salaries are: Agriculture, $45K; Engineering, $56K; Dentistry, $75K, Medicine, $55K and Law, $48K (Source: GCCA 1999-2010).

Other salutary comparisons indicate that Australian veterinary incomes are substantially less than overseas (2009). At around $67K pa, Australian salaries do not compare favourably with US veterinarians

who earned $121K on average in private practice: (DVM, 4th February 2011). Those vets in small animal practice earned $125K, equine $127K, food animal $131K and public and corporate $167K. In Australia, these relatively low financial returns after graduation pose an increasing risk that increasing student fees will deter enrollments. Alternatively, students may elect to move overseas after graduation, a professional and economic loss to Australia which is enabled by the global marketplace and our BVSc accreditation.

3.3 International initiatives maintain crucial expertise and support rural placements

While the Australian government has accepted the need to provide inducements or subsidies to attract medical practitioners to rural and regional practice, other professions have been overlooked despite similarities in economic and social imperatives.

Overseas, but not yet in Australia, government schemes have been introduced to support education costs of food animal and veterinary public health training, as the risks of lack of expertise are recognized. Given the central role of veterinarians in food security and public health, several overseas schemes recognize the importance of retaining a critical capacity in these areas. Examples include the NZ Government Beehive scheme http://www.beehive.govt.nz/release/vet-scheme-will-benefit-rural- communities, which is a voluntary bonding scheme that provides a taxable payment of $11,000 each year for up to 5 years for new graduate veterinarians of Massey University Veterinary School working in understaffed rural communities.

In the USA the Veterinary Public Health Amendments Act (HR 525) allows PHSA grants to support institutions that educate public health veterinarians (2011) while the Food animal veterinary education loan forgiveness, an initiative from the USDA National Institute of Food and Agriculture, offers repayment for rural veterinarians education loans where they commit to provide food animal services in areas with a shortage and public practice (2010). http://www.thegovmonitor.com/world_news/united_states/usda- announces-veterinary-medicine-loan-repayment-program-recipients-42341.html .

Professor Bruce Robinson MD MSc FRACP Dean, Sydney Medical School

. Secretariat Higher Education Base Funding Review Box 9880 CANBERRA ACT 2601

Dear Sir/Madam

I am writing to advise that, even before the Government announced the Base Funding Review, Sydney Medical School had decided to undertake its own costing study so that the School, the University and other relevant organisations could be made aware of the actual cost of delivering medical education at this University and the disparity between that cost and the funding made available by the Department of Education, Employment and Workplace Relations.

With the announcement of the Review we have proceeded more quickly with our study than originally intended but, unfortunately, it will not be possible to provide a final submission by 31 March 2011. We do believe that a submission can be provided by 30 April 2011.

The submission to be provided by Sydney Medical School will complement that prepared by Medical Deans Australia New Zealand and, in particular, will extend that submission by explicitly outlining the extraordinarily valuable "in-kind" contribution made by others to medical education. The sources of these "in-kind" contributions are, in the main, the state health systems and individual health practitioners, including those employed by State health systems and also by the private sector as well as by individual health professionals.

My colleagues and I would be very happy to discuss any aspects of the submission with the Review.

Yours sincerely

Bruce Robinson Dean

24 March 2011

Sydney Medical School T +61 2 9351 6570 ABN 15 211 513 464 CRICOS 00026A Room 201, Edward Ford Building A27 F +61 2 9351 2433 E [email protected] The University of Sydney NSW 2006 www.sydney.edu.au/medicine Australia

The University of Sydney SYDNEY CONSERVATORIUM OF MUSIC

Faculty Submission to the Base Funding Review

INTRODUCTION

This submission identifies the plight of tertiary music institutions in Australia. It makes clear the importance of music education to the national economy and cultural identity and describes the positioning of Australian music education and the music industry in a world context. The cost structures for music education are explained and the shortfalls in current levels of funding identified. In the conclusion we propose a way forward that will preserve an essential part of the national higher education system and cultural heritage.

SYDNEY CONSERVATORIUM OF MUSIC BACKGROUND

A global centre of excellence in music, providing leading edge education, research and performance

Founded in 1915, the Sydney Conservatorium of Music is a diverse institution – a cultural catalyst inspiring the study, research, creation and performance of music in all its forms. Based on the model of the European Conservatoire, its establishment revolutionised Australian music training where comprehensive performance-led teaching, virtuosity and music education were made available to musicians aged 5 to 90 – an opportunity still available to this day through community and youth oriented programs and tertiary level degree programs.

After a long and illustrious history the Conservatorium amalgamated with the University of Sydney in 1990 and from 1997 to 2001 underwent a $138 million redevelopment creating one of the more interesting buildings in Sydney, a fascinating combination of the early history of New South Wales and late twentieth century architecture. In 2011 the Conservatorium was formally listed on the NSW State Heritage Register due to its historical, architectural and cultural significance.

In 2005 the Music Department of the University of Sydney and the Conservatorium united to form a unified research institution, where research and the advancement of knowledge are integrally linked to teaching and performance.

In recent years the Conservatorium has established a number of international collaborations with leading institutions across Asia, Europe giving students the opportunity to perform on the global stage at events including the Beijing Olympics 2008, the Shanghai World Expo 2010 and the London Olympics in 2012.

The University of Sydney is conscious of its responsibility to the nation through its stewardship and custodianship of the Sydney Conservatorium of Music. This institution is the premier music institution in Australia and a leader for the nation. Its responsibility therefore is not limited to the Sydney Conservatorium, but also to the nation.

Sydney Conservatorium of Music Submission to Base Funding Review Page 1

VALUE AND IMPORTANCE OF MUSIC TO AUSTRALIAN SOCIETY AND ECONOMY

The purpose of tertiary education in music is to train the professionals who will pass on the musical culture. These are the artists who create and perform music for the public. They are able to do this because they received expert training from teachers, usually from an early age, and because they are supported by those who organise their contact with the public: the marketers, live music presenters, venue managers, record companies, broadcasters, technicians, lawyers and others. All of these people play a role in passing on the musical culture. An expert practical experience and knowledge of music is for most, essential, and at the least, an advantage and all, therefore, are potentially candidates for tertiary music education.

This activity makes a significant contribution to the economy and to the cultural identity and strength of the country. However, the benefit to the economy should not dominate the rationale for provision of higher education in music or indeed, other subjects. Economic success is not an end in itself, but serves other ends such as the pursuit of knowledge, increasing personal and societal options for a rich and meaningful life, the expansion of the opportunities for cultural expression and communication. Heightened musical activity builds cultural capital.

Economic contribution of the music sector

Gross value-added. In 2007, Hans Hoegh-Guldberg estimated the value of the Australian music sector at $6.8billion value-added based on 2005-06 statistics.1 This treats the sector as a „satellite account‟, similar to the statistical account for tourism. Thus, it includes not only the value of live and recorded musical performance and music instruments and equipment, but the music-related aspects of industries such as education and broadcasting. It is not possible to determine a figure other than by estimate because of the inadequacies of ABS activity with regard to the music sector.2

Employment and participation. The sector is a substantial source of employment. Around 150 job categories are identified by the Music Council in its publication, The Australian Guide to Careers in Music.3 The following ABS figures from April 2007 show participation. 4 They exclude hobbyists (except for the final reference), teachers, broadcasters, others in the Guldberg satellite account estimate. The ABS does not further define „not performers‟. The employment figures from the ABS do not include all those who would be captured in the Guldberg definition in areas such as broadcasting.

Persons Involved

Number of persons involved in live performance: 253,000, of whom 91,000 received payment (36%)

1 http://www.musicforum.org.au/mediawiki/index.php?title=Estimating_the_Value_of_the_Music_Sector 2 Some paradigms have been broken since 2006 with digital disruption of the recording industry and new modes of creation and distribution and an update would require additional direct research. 3 The contents of this publication are being incorporated in a new Music Council website, www.musiccareer.com.au, which is to be launched by the end of March 2011. 4 Australian Bureau of Statistic: Work in Selected Culture and Leisure Activities. April 2007. http://www.ausstats.abs.gov.au/Ausstats/subscriber.nsf/0/A83F5A97A030078ECA2573B5000A7604/$File/62 810_apr%202007.pdf

Sydney Conservatorium of Music Submission to Base Funding Review Page 2

Number involved other than in live performance: 83,000, of whom 28,000 (35%) received payment

Total number involved: 336,000, of whom 119,000 (36%) received payment.

Trend, Persons Involved, 1993-2007

1993 2007 Live performers 199,000 253,000 Not performers 33,000 83,000 Total 231,000 335,000

The total increased by 45%. The ABS does not show paid vs unpaid for 1993.

Education and qualifications. 5 84% of musicians and 66% of composers undertook tertiary training for their principal arts occupation. 51% and 32% of these, respectively, studied at a music school or conservatorium.

At present, it would appear to be more necessary for performers to have a relevant qualification than for non-performers. However, there are many complaints within the sector about the incompetence of eg artist managers and even the inadequate preparation of performers. There appears to be a need for more inclusive education of those engaged in the sector, and more thorough, advanced preparation of the artists, at present constrained by lack of resources as will be demonstrated through international comparisons.

Work Vs Hobby

5 http://www.australiacouncil.gov.au/__data/assets/pdf_file/0007/79108/Do_you_really_expect_to_get_paid.pdf

Types of training ever undertaken to become an artist (a) (percent)

Years of training spent on basic qualification to be a PAO (percent) [person with a Primary Arts Occupation]

Sydney Conservatorium of Music Submission to Base Funding Review Page 3

335,000 participants regard their music activity as work. An additional 265,000 regard it as a hobby. Total number involved is 600,000.6 It is in part the hobbyists to whom the culture is passed.

Music’s contribution to society7

Music is practised in all cultures, even the most poverty-stricken. It must be concluded that it is serving some universal human need.

In Australia, as a Western consumer society, the need is demonstrated in a concrete way by the crowd and the size and complexity of the industry that has grown up to satisfy it. The economic and participation data above are evidence.

What can be said about music‟s value to society?

Music creates social bonds, more powerfully where people perform music together8 but even among members of an audience – they attend not only to hear the music but to hear it together.

It is a source of identity. Young people identify around particular genres and artists that they regard as „ours‟. We all have „our‟ music, distinguishable from „their‟ music.

Music gives spiritual and emotional sustenance. It is a core aspect of most religious practices. Many not religiously inclined still turn to music to take them to a „deeper‟ place.9

Music is food for the intellect. We refer to the study of music‟s place in history or society but more especially to the study of the audible structures and processes of the music itself. Deep study of great music can reveal extraordinary intricacy – a mathematics-like complexity put to the service of profound expression, as in the works of Bach and many before and since.

The reference to Bach reminds us that we rank the achievements of the great composers alongside the achievements of the great scientists, political leaders, generals. Most know the name of Beethoven even if they could not recognise the music.

Other places and times: We can experience through their music the world views of other cultures, indeed, the very cores of their being. Because Western classical music has been recorded for over a millennium – on paper – and this music is performed live today, it offers us glimpses of our own history, not just as perceptions, but as lived experiences.

The immersed listener can absorb these effects of music but its full impact is reserved for the music-makers.

Consider the activity of, say, an improvising jazz musician. Firstly, the musician brings to the task a set of skills and knowledge acquired over many years through disciplined study and practice – self-disciplined, for indeed there is no other way to devote most waking hours to the learning.

The improvising musician is doing all of these things simultaneously: creating something new based around a complex given „language‟, applying therefore a moment-by-moment intellectual assessment of what is routine, what is novel, what are the structural and stylistic assumptions and where is this moment placed within them, and so on. Because of the deep training, during performance this is more usually „felt‟ rather than „thought‟; decisions are intuitive – „in the flow‟, rather than consciously analytical.

6 ibid ABS 7 This section draws substantially on the work and writing of the Music Council of Australia 8 Surveyed members of the Queensland Youth Orchestra said that they felt like friends simply based on their participation in rehearsals, not so much from normal social intercourse 9 Psychologist Abraham Maslow found (classical) music, sex and nature to be the three main triggers of “peak” or “oceanic” experience. (Towards a Psychology of Being)

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Integrated into that is a flow of emotional expression – „Music moves as the emotions move‟. 10 The communication is most likely purely musical – the meaning is intrinsic and not referential; the emotional content is experienced immediately by the listener, is not something to be observed from a distance. Nevertheless, the music may also be at the service of story- telling, or supporting dance movement or drama, in which case an entire additional set of musical issues is introduced.

The musician is listening to other members of the ensemble, responding in milliseconds, anticipating, leading, following. S/he is also somehow aware of, responding to the audience, since this is about communication, not just self-expression. The musician is him- or her-self simultaneously performer and audience.

Combine those requirements and attributes with the acquisition of physical skills developed over many years akin to the professional athlete. This encompasses the use of extremely intricate small muscle movement – probably the most fleet and subtle of any human physical activity. The development of these physical skills forms a great part of any musical training.

Research shows that music-making activates simultaneously many parts of the brain; it suggests and is close to concluding that music study uniquely benefits brain development. This may be the underlying basis for the findings of a large number of other studies showing correlations between continuous and extended study of music making and enhanced outcomes in other areas of study including literacy and numeracy.11

Some musical genres are a unique local expression, some are international „languages‟ – e.g. rock, jazz, classical. Australian audiences hear the great international exponents via the media and even in live performance. They expect our musicians to show similar accomplishment. Our musicians function in an international market, even if they stay at home. Some, of course, also attempt to win audiences elsewhere. We want them to succeed, and why should they not? But there are serious gaps in our help and support for them.

As in many areas of endeavour, any citizen is able to engage at an informal level in music making and consumption. The „folk music‟ of the day can still be passed on by oral transmission. However, music as a great artform requires serious and prolonged study and in Western culture the place for that study is for the most part the university/conservatorium of music. Within the institution the key element is the individual one-to-one mentor.

Equity of Access

Equity of access to tertiary music study is extremely problematic. It depends not only upon financial support to disadvantaged students once they are engaged in tertiary education, but the preparation in the pre-tertiary years that will affect their eligibility for admission. There is both inequity and general inadequacy in the provision of music education to students in the school years and the consequence is that there is major advantage to financially privileged students at the time of high school graduation and university entrance. The funding of school music education is not within the domain of base funding to higher education, but its deficiencies in being able to provide the kind of music teaching necessary to prepare students for tertiary music courses are a major impediment for many students to move into tertiary music training. In the absence of adequate musical training and education in the school education sector, the identification and nurturing of musical talent lies very much in the hands of the private sector, an option that is not available to the less advantaged.

The report of the National Review of School Music Education, Augmenting the Diminished, gives as its second Strategic direction: “To ensure every Australian child has opportunities to participate and engage in continuous sequential, developmental music education

10 Suzanne Langer: Philosophy in a New Key. Mentor, 1951 11 For instance, Champions of Change, a longitudinal study of 25,000 US school students.

Sydney Conservatorium of Music Submission to Base Funding Review Page 5 programmes.12 There is very wide agreement in the profession on the “continuous, sequential, developmental” formulation for the music curriculum.

These characteristics were adopted as the criteria for an estimate of the number of schools offering a credible music education program. The estimate was made by extrapolation from the study Trends in the Provision of Music Education in Schools. 13 It showed that 88% of independent schools have such music programs, but only 23% of public schools. A survey by the Australian Music Association showed that 88% of parents believe that all school children should have the opportunity to study music.14 It is an interesting coincidence that the provision among independent schools matches statistically the desire among parents, but of course the school programs are guided by what the parents wish to pay for. That link is lost with most state schools where broad funding decisions are made by the state.

There is thus an enormous inequity of opportunity between independent and public schools and most students of public schools will not have received a music education that gives them equal opportunity to enter a tertiary music institution.

12 Robin Pascoe et al: National Review of School Music Education. Augmenting the diminished. Australian Government, Department of Education, Science and Training, 2005, page xvi. 13 Robin Stevens: Trends in the Provision of Music Education in Schools. Music Council of Australia, 2003. http://www.mca.org.au/research/research-reports/research-reports/635-trends-in-the-provision-of-music- education-in-schools The count for public schools would have been slightly improved by the later introduction of specialist music teachers into Tasmanian primary schools. However, this may have been reversed by a general decline in provision, as informally reported. 14 Australian Attitudes to Music. Australian Music Association. http://www.mca.org.au/research/research- reports/other-research/107-australians-attitudes-to-music

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THE CHALLENGES FACING MUSIC EDUCATION IN AUSTRALIA

Australia‟s tertiary music institutions are under major financial stress. Institutions are aware what is required to provide a credible music education to their students but they do not have the funds to provide it. They know because pre-Dawkins, they were funded to provide many more teaching hours, including time for one to one instruction, and because they are aware of the norms in their competitors internationally. We are aware that total music teaching hours at Melbourne University declined from 1105 hours in 1992 to 556 hours in 2011 – a 50% reduction. Griffith University has had to reduce its one to one teaching from 24 hours per year to 20 hours per year.

The institutions have cut programs in order to meet financial constraints. But in an endeavour to maintain some credible, acceptable standards, they run at a deficit.

In some cases, the deficit is met by the university, in some cases by a cross-subsidy from within a faculty; in others, the institution is forced to repay the debt, which results in further cuts to their programs and credibility. Their situation continues to decline and eventually, for some, it will not be feasible to continue. Signs of that occurring are already evident.

It should be understood that the graduates of Australia‟s tertiary music institutions enter an international market. Most literally, some will seek to succeed with overseas audiences. But, as already noted, the international market and international standards exist in Australia. Australian audiences are very familiar with international standards through their constant access to performers from across the globe, whether experienced through recordings, broadcasts or the web, or through live performances on tour to Australia, or through Australian travel overseas. They seek those standards and the appeal of the home-grown is only one of the factors that will influence their choices.

Australian tertiary music institutions also function in the international market. The best Australian students consider whether they are better served by attending an Australian conservatorium or a foreign one. Australian music institutions compete with institutions from other countries in attracting foreign, fee-paying students.

There are consequences also for the music faculty. Because of the financial situation of our tertiary music institutions, they routinely oblige their faculty members to transfer time from research to increased teaching duties. This is inequitable. It disadvantages the music faculty members in maintaining the vitality of their practice and progress in their careers, and it disadvantages the institutions in their claims to contribute to the academic enterprise. Insofar as their funding depends on their research output, a bad situation is made worse. The institutions are less attractive to prospective faculty members, especially those in countries where research time is honoured and creative output, including performance, is recognised. Likewise with students, Australian music institutions face the loss of international students to better funded institutions in other countries. That same effect will be felt through a drift of talented Australian students to overseas institutions.

The following table shows the EFTSL of international students enrolled in music courses in 2008. At the time of writing this submission, data on later years was not available to us. However, EFTSL of international students in the Sydney Conservatorium of Music has grown from 26.2 in 2008 to 87.9 in 2010, a 235% increase. It is reasonable to assume that similar increases have occurred in other institutions, bringing total international student EFTSL in Australian institutions to in the order of 600 in 2010.

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2008

Course - Higher Education Provider Type International Australian Catholic University Public 0.2 Central Queensland University Public 0.0 Charles Darwin University Public 0.3 Edith Cowan University Public 2.0 Griffith University Public 32.0 James Cook University Public 0.0 Macquarie University Public 0.1 Monash University Public 12.1 Queensland University of Technology Public 6.0 Southern Cross University Public 1.5 The Australian National University Public 6.2 The University of Adelaide Public 16.0 The University of Melbourne Public 46.0 The University of New England Public 0.8 The University of New South Wales Public 3.5 The University of Newcastle Public 10.4 The University of Queensland Public 6.8 The University of Sydney Public 26.2 The University of Western Australia Public 5.9 University of Ballarat Public 1.0 University of Southern Queensland Public 4.1 University of Tasmania Public 8.9 University of Western Sydney Public 0.4 University of Wollongong Public 0.0 Victoria University Public 0.0 Total 190.3 Avondale College Private 0.0 Box Hill Institute of Technical and Further Education Private 9.3 International Conservatorium of Music Private 16.8 JMC Academy Private 8.8 Northern Melbourne Institute of TAFE Private 3.0 Tabor College Private 0.0 The Australian Guild of Music Education Private 0.0 The Australian Institute of Music Limited Private 29.6 Wesley College Private 4.1 Total 71.6 Total 261.9

If Australia does aspire to a tertiary education sector of international standards and status, it must devise the strategies and provide the funds that make that possible. We seek not the assertion of international standards, but their achievement. In music, there is no reason that Australia should not rank among the highest achieving nations other than a failure to create the conditions by which that can be accomplished. It is appropriate to work for efficiencies and curricular innovation, but if there is not a match between aspiration and investment, if the

Sydney Conservatorium of Music Submission to Base Funding Review Page 8 resources are insufficient to pay for the delivery of a high level of instruction, Australian institutions will lag further behind those in other countries.

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A GLOBALLY COMPETITIVE LEVEL OF BASE FUNDING FOR COURSE QUALITY AND STUDENT ENGAGEMENT

Q2.3 Is there a system of higher education funding in another country that would be useful benchmark model to inform Australia’s review of base funding?

In 2010 and 2011, the Sydney Conservatorium of Music has undertaken a benchmarking study of selected UK, European and USA music institutions and some of the results of that study are included in this submission.The following table represents the sources of total revenue for the Sydney Conservatorium, two comparable European institutions, two USA institutions and two from the UK.

% of Total Revenue by Type (Thousand AUD) – SCM Benchmarking Study

The Higher Education Funding Council (HEFCE) provides government grants to the RNCM and RCM. In the year reported, both received additional exceptional funding as performing arts instituions embedded in their recurrent teaching grants.

Conservatories in Scandanavia are funded in the main by government grants whilst Conservatories in Northern America are more reliant on student fees and endownment and interest revenue. Conservatories in England, as in Australia, are funded in the main by a combination of government grants and student tuition fees and to a lesser degree by other sources.

Government Funding + Student Tuition Fees (Thousand AUD) per student – SCM Benchmarking Study

The above graph compares the SCM 2011 budget government funding + Student Tuition fees per number of students to that of other institutions. The SCM has the lowest revenue per student number at $15.5k compared to an average $25k in UK, $41k in Scandanavia and $57k in North America.

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COST STRUCTURES FOR MUSIC (Performance and Composition)

Indicative Cost for Performance Students

At this point, we have separated the cost of performance and composition courses. It is these that have the highest cost structures. Attachment A represents the indicative cost of educating a music performance student. It is based on costs at the Sydney Conservatorium of Music and adopts the principles and methodology of the University of Sydney Economic Model. But it reflects the five key learning areas that will be covered in a typical course in a music institution. Naturally, individual institutions will have different course structures, but they all cover the elements included in the cost table which are common around Australia and internationally. It represents contemporary thinking on the fundamental requirements to train and educate a performer. The detailed methodology behind this costing model can be made available to the Review Committee on request.

The table shows a direct teaching cost per student (EFTSL) of $8,595 pa. To that cost we have added the support and infrastructure costs associated with the direct support of the teaching and related activities within the music institution plus the infrastructure and service costs of the university to which the music institution belongs. The costing needs to be considered in the context of current financial circumstances. The model uses the 2011 budget and is in 2011 prices. But it needs to be considered in the context of the overall financial position. Significant cuts have already been made in the budgets of the past two years in an endeavour to partially address the underfunding identified in this submission. Those cuts are already having an adverse impact on the learning and teaching programs in areas such as the provision of accompanists for essential student performances required in the curriculum and for students assessment, orchestral and ensemble management, the breadth of electives and the direct support to learning and teaching activities.

CSP funding for music under funding cluster 5 is $16,274 per EFTSL. The differential between the cost and the funding level is graphically represented as follows:

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The following table compares this differential at the SCM with six comparable institutions overseas. The SCM is one of only two institutions in this study that shows a deficit, but with the largest deficit of those two by a large margin. That situation is repeated across Australia as we have identified above under „Challenges‟.

SCM Benchmarking Study

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CURRENT BASIS OF FUNDING THROUGH THE USE OF ‘FUNDING CLUSTERS’

General Use of ASCED

Currently, funding for discipline groups is determined by the „funding cluster‟ into which they fall based on the „field of education‟ code in the Australian Standard of Classification of Education (ASCED). Music falls into funding cluster 5 along with clinical psychology, allied health, foreign languages and visual & performing arts. There are fundamental problems with this classification for music which we now explore.

The Australian Bureau of Statistics (ABS) publication, Australian Standard Classification of Education (ASCED 2001) states:

“The Australian Standard Classification of Education (ASCED is a statistical classification for the use in the collection and analysis of data on educational activity and attainment. ASCED has been developed as part of a national framework for the storage, exchange and dissemination of statistical and administrative data on educational activity in Australia”15

Nowhere in that document is the cost of delivering the education mentioned; its intention was not to be a tool in determining costs but was limited to the purposes quoted above. Nevertheless, ASCED has been used to determine the levels of funding for the various disciplines resulting in a distortion of funding levels for music education. We will describe below the cost structure issues that are not accommodated by the current approach.

“educational activities” as described in the ABS document are related to the level of the course, eg postgraduate, not to the inputs necessary to achieve the outputs.

Application of ASCED to Music Education

One Classification for Music

The first problem arising from the application of ASCED to music education is that there is only one classification (100101). However, the nature and cost structures of music performance and composition are very different to those applying to non-performance and composition. The cost structures for delivering music education in performance and composition are described later in this submission.

The problems in this area originate when the ABS introduced ASCED as a single “new national standard classification, which would be significantly broader in scope than the ABSCQ, and would replace the range of classifications used in administrative and statistical systems”. “An important issue in the development of ASCED was the need to include all sectors of the formal Australian education system; that is, schools, VET, and higher education”16.

Distinctions in the cost structures for various elements of music education were recognised in the former VET classification structure which identified five different classifications, all of

15 Australian Bureau of Statistics (ABS). Australian Standard Classification of Education (ASCED 2001). p1 16 Australian Bureau of Statistics (ABS). Australian Standard Classification of Education (ASCED 2001). p2

Sydney Conservatorium of Music Submission to Base Funding Review Page 13 which were translated into just one classification in ASCED. That conversion is represented in the following table:

Discipline Group - VET ASCED Field of Education 0605101 Music – General 100101 Music 0605110 Orchestration 100101 Music 0605115 Instrument Work 100101 Music 0605120 Voice Work, Singing 100101 Music 0605125 Chamber Music 100101 Music 17

Broad Field of Education – 10 Creative Arts

This is the broad field of education into which the single detailed field for music (100101) is placed. The Department of Education, Employment and Workplace Relations document, Field of Education Types, includes the following descriptive elements:

“The theoretical content of Broad Field 10 Creative Arts includes”

“The main purpose of this broad field of education is to develop an understanding of composition, performance, ...”

[accents inserted]

It is clear from these descriptions that the broad field of education is limited to the academic study of these disciplines and does not capture performance and composing elements of the discipline.

Factors Contributing to Underfunding

There are six major factors which contribute to the underfunding of music education from Commonwealth funding sources. All of these are outside of or not accounted for in the funding for CSP:

The curriculum delivery methods essential for performance and composition music education.

It is well documented that music requires one to one teaching for instrumental and composition teaching. This is underpinned by national and international benchmarking and best practice for the discipline. The USA National Association of Schools of Music (NASM) states in its Handbook as part of its accreditation requirements for music institutions:

“4. At the undergraduate level all students in professional programs are normally required to have a minimum of one hour (60 minutes) of individual instruction per week, or a

17 Australian Bureau of Statistics (ABS). Australian Standard Classification of Education (ASCED 2001). p322

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comparable equivalent arrangement of individual and/or small group instruction, in the principal performing area(s)”.18

Peabody Institute of Music, one of the world‟s leading music institutions, in seeking support for the institution, states that that support will assist to “provide the one-to-one, artist-to- student teaching that is critical to musical development”.

In its Handbook on the Implementation and Use of Credit Points in Higher Music Education, the Association of European Conservatoires, Academies de Musique et Musikhochschulen (AEC) assumes instrumentalists will receive 1.5 to 2 hours per week of individual tuition. It also provides some examples eg the National University of Music (Bucharest) provides 1.5 hours per week of individual tuition and the Lithuanian Music Academy 2 hours per week.19

International benchmarking is important in informing decisions about Australian institutions given the information provided elsewhere in this submission about the positioning of music education within a world market and the importance of music to the Australian economy and society. The following table provides a comparison of one to one teaching in the Sydney Conservatorium of Music with two comparable institutions in the UK, four in Europe and three in the USA:

SCM Benchmarking Study Institution Number of Individual tuition hours per student per year Sydney Conservatorium of Music 28 Royal Northern College of Music, Manchester 45

Royal College of Music, London 45 Hochschule for Music, Wurzburg 51 Sibelius Academy, Helsinki 39 The Royal Danish Academy of Music, Copenhagen 39 Norwegian Academy of Music, Oslo 36 University of Colorado at Boulder 39 San Francisco Conservatory of Music 32 The Julliard School, New York 32

Beyond the one to one teaching requirement, much of the other teaching requires small group instruction. Eg aural and chamber music can each only be taught in small groups (<= 10). There is no discretion in these limits as they are determined by a combination of the music repertoire being studied and performed (the instrumentation is prescribed – eg string quartet), pedagogical imperatives and the nature of the teaching spaces required for the particular activity.

18 National Association of Schools of Music. Handbook. P63 [The National Association of Schools of Music has been designated by the United States Department of Education as the agency responsible for the accreditation throughout the United States of free-standing institutions, and units offering music and music- related programs (both degree- and non-degree-granting), including those offered via distance education. The Association has also been recognized by the Council on Higher Education Accreditation and is a member of the Association of Specialized and Professional Accreditors.] 19 Association of European Conservatories, Erasmus Mundus. Handbook on the Implementation and Use of Credit Points in Higher Music Education

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Requirement for Public Performances

The essence of a music education institution is public performances. In the case of students, performances are an essential part of their education and include a wide range of performance types; orchestral, opera, chamber music, jazz, recital. All of these are public concerts and essential in equipping them for the profession.

Academic staff of music institutions are in general required to be practicing performers as part of their contract of employment. The performances that they give are directed at producing creative outputs which are in turn recorded as such or as research as part of the Excellence in Research for Australia (ERA). This is an important element in music institutions earning research income (at present that component included in the HERDC). This is the inextricable link between research and teaching; it informs the teaching process and adds to the educational experience of students through their own participation with and beside their teaching mentors.

This activity is intense and has costs associated with it and is of a kind that is not found in the other disciplines in Funding Cluster 5. The cost elements involved in presenting concerts which are not funded under Funding Cluster 5 are:

 Concert management staff;  Music purchase and hire;  Performing rights;  Venue costs;  Publicity and marketing.

Specialised Nature of the Building and Performance Facilities Required for Music

Music buildings are specialised facilities which differ markedly from the kind of buildings and facilities required of other disciplines in Funding Cluster 5. Features which set music buildings apart include specialised acoustics, lighting, sound isolation, traffic (people) control, airconditioning and humidity control (essential for musical instruments). These extend to specialised performance spaces and facilities including concert and recital halls and theatres, individual teaching studios, small ensemble classes and large rehearsal spaces. Both the capital cost of such facilities and the infrastructure and services required to support and run them are more akin to the cost structures for the sciences and dentistry/medicine/veterinary science which are in Funding Clusters 7 and 8.

The cost elements involved in supporting the building and venues are beyond what is provided for under Funding Cluster 5:

 Venues management staff  Technical staff  Front and back of house staff  Ticketing  Energy consumption  Repairs & maintenance  Room management and scheduling  Security

Special Nature of IT and Audio-visual Requirements for Music Education

By its nature, music education has a requirement for specialised A/V needs beyond those required for other disciplines in Funding Cluster 5. These include high definition sound and video required to support teaching, live performance and the delivery of research and creative outputs. The other element of this technology is the IT interface with the HD A/V equipment.

The cost elements beyond those supported by funding under Funding Cluster 5 are:

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 Specialised and dedicated technical and IT staff  Equipment costs  Repairs and maintenance.

Instruments and Equipment

As with building facilities, the equipment needs for music education are more closely related to disciplines in the Funding Clusters 7 and 8. That specialised equipment relates particularly to pianos and other expensive musical instruments. A music institution can have upwards of 150 pianos which are needed in every studio, teaching space and performance venue.

The cost elements associated with these requirements beyond those supported by funding under Funding Cluster 5 are:

 Purchase/leasing costs;  Salaried piano technician;  Contract piano tuning (pianos can require anything from 2 to 600 tunings per annum depending on the nature and quantity of use);  Other instruments repairs & maintenance.

Other Specialised Administrative Needs

The student life cycle in a music institution involves individual attention at all points in that cycle; – eg

 audition and interview at admission stage (require individual scheduling of each applicant before a panel of staff);  enrolment;  placement and management in various ensembles (each student requires individual allocation to various orchestras, chamber music groups and other ensembles and the monitoring of those arrangements to ensure that course and assessment requirements are met);  individual assessment in recitals etc (each student has to be scheduled individually before panels of staff);  management of individual students to individual teachers;  management of performances for each student.

These cost elements beyond those supported by funding under Funding Cluster 5 are:

 Additional specialised administrative staffing;  Music specific systems.

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SUMMARY

It follows from the above that the financial provision for tertiary education in music is insufficient to support international competitiveness in Australia. We have clearly identified the levels of funding required to meet these requirements.

The following table shows all EFTSL in Music units of study (ASCED 100101) for 2008, the last official statistics to which we had access at the time of writing. The last column represents EFTSL in those institutions that have significant enrolments in performance courses. One of the problems of the single ASCED for music is that statistics are not available on enrolments and EFTSL in performance courses. It can be assumed that 2008 enrolments and EFTSL in performance courses is less than the total of 2364.5 shown in this table. In the Sydney Conservatorium of Music, EFTSL in performance courses is 76% of total EFTSL. That percentage applied to national total EFTSL in music units of study in institutions with significant enrolments in performance courses would represent approximately 1,796 EFTSL in 2008. However, we recognise that appropriate research with each institution into actual numbers would be needed to arrive at actual data.

2008 2008 Course – Higher Education Type Domestic Domestic Provider (Institutions with major performance program) Australian Catholic University Public 20.3 Central Queensland University Public 11.5 Charles Darwin University Public 14.3 14.3 Edith Cowan University Public 165.9 165.9 Griffith University Public 429.3 429.3 James Cook University Public 4.0 Macquarie University Public 6.1 Monash University Public 167.3 Queensland University of Technology Public 120.8 Southern Cross University Public 96.3 The Australian National University Public 137.6 137.6 The University of Adelaide Public 273.4 273.4 The University of Melbourne Public 489.1 489.1 The University of New England Public 33.0 The University of New South Wales Public 110.3 110.3 The University of Newcastle Public 101.9 The University of Queensland Public 105.0 The University of Sydney Public 430.3 430.3 The University of Western Australia Public 113.9 113.9 University of Ballarat Public 46.0 University of Southern Queensland Public 58.6 University of Tasmania Public 200.5 200.5 University of Western Sydney Public 134.9 University of Wollongong Public 0.8 Victoria University Public 73.9 Total 3344.6 2364.5

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This submission documents the cost structures in providing courses in music performance. Whatever funding mechanism is put in place, it needs to recognise those cost structures and provide funding for institutions to meet those funding needs.

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Our recommendations are:

1. That a long-term approach be taken to design a specifically targeted process for determining funding for music education which recognises the cost structures associated with the delivery of music education. This should be based on detailed and agreed international benchmarking.

The Sydney Conservatorium of Music has some experience in international benchmarking. Further, more than other music institutions in Australia, it has a broad spread of its academic staff with significant international experience. As well, the Sydney Conservatorium has forged many international partnerships and collaborations. Given these attributes, we would be willing to participate in an active way towards assisting with the research and development of such a new process of funding music education.

2. Given that recommendation 1 would take some time to be realised and the fact that music institutions have an immediate need for relief if long-term and irreversible damage is not to occur, we recommend a transition arrangement under a relative model based on ASCED, that moves funding for performance and composition courses in music from funding cluster 5 to funding cluster 8. This would place it with disciplines that have comparable cost structures.

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ATTACHMENT

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