Julia Gillard’s inside story on the demand driven system

In a strange kind of way, I have reason to be grateful to Julia Gillard. As education minister she did what I had argued for from the late 1990s, and largely ended the quota system of distributing student places between universities.

Debate about the ‘demand driven system’ she introduced has been good for my career, particularly via the demand driven review. I haven’t completely given up hope that the reforms recommended by the review might become policy.

So I was interested in what Gillard had to say about higher education in her book, My Story.

It seems that red tape annoyance may have had something to do with the demand driven system. She complains that she had to “sign off on a brief so that 20 or 30 [student] places could be moved from a university that wanted to surrender them to a university that wanted to take them up.”

I always said that this was absurd, although I was more worried about the consequences for universities and students than ministers. Gillard even uses the same language I did about unchaining universities.

Unsurprisingly, much of the argument within the government about the demand driven system was about money. It nearly didn’t get through the Expenditure Review Committee, saved by a “ministers-only discussion in Kevin’s office” (back in the day when it was Kevin’s office; see the rest of the book…).

Later on, when the demand driven system was costing even more than the sums that had nearly seen it rejected by the ERC in the first place, there was “internal pressure” to “revert to a more traditional, predictable capped approach to funding”. She says that if she had not been PM the system “probably would have been trimmed”.

She defends the alternative to capping, which was an “efficiency dividend” (revealingly copyedited to read “limited-efficiency dividend”). She wasn’t a fan of the National Tertiary Education Union’s response to this, which she dismisses as “hysterical and immature”.

Many tens of thousands of students are in universities today who would not have been if Gillard hadn’t been education minister and then PM. Many others have benefited from universities being more responsive to students. The demand driven system is a real policy achievement.

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