A new Universities Australia lobbying document released today (The Australian‘s report is here) contains some not previously publicly released information on university costs, based on information from six universities. The data is presented in a slightly confusing way, as UA have made the assumption that 25% of Commonwealth subsidies paid on a per student basis is for research, creating separate funding ‘gaps’ for teaching and research.
However, what it shows (if you get your calculator out) is that teaching-driven Commonwealth funding of $16,068 per average EFTSL and teaching-driven expenses of $16,151 per average EFTSL are pretty much in alignment. This helps explain why so many universities are significantly ‘over-enrolled’ – once the demand-driven funding system is fully operational they expect to at least break-even by avoiding research costs.
The funding ‘gap’ varies significantly between fields of study:
Unfortunately the assumptions behind these numbers are not explained, especially on how they calculated ‘base’ research spending. Universities often talk about ‘unfunded’ research, by which they mean research that does not have a dedicated research funding source, rather than research that is not being paid for. Just because some universities can generate signficant cash from other sources, especially international students, that they then spend on research does not mean that there is any policy obligation on the government to support it.
On the other hand, the government does insist that research activity is a legal requirement of on-going status as a university, so this obviously raises the issue of how that research activity is financed. The draft guidelines on what research is required at least raise the possibility that research is expected across all faculties, and not just in the minimum three broad fields of study. As dedicated research funding is biased towards previous research excellence, the student funding system would be a way of distributing research support across the whole university.
However, this also seems to be a needlessly expensive way of running a mass, demand-driven, higher education system. I can’t see any strong policy reason why research dollars should automatically flow to whatever disciplines are most popular among undergraduates. Encouraging teaching-only institutions, and perhaps teaching-only faculties, would be a way of delivering higher education at lower cost.
Andrew Norton 
You’ve still yet to explain to me how you are going to get decent staff at research only institutions, unless you want to turn everything into a 4-year liberal Arts college and end up with the same problem as the US (i.e., everyone gets to do 6-7 years of uni to learn anything). It’s hard enough to get staff in many areas with the current conditions — many engineering graduates, for example, in their first year of work earn a similar amount as a Level B lecturer (and it’s not just engineering — that’s part of the reason universities now have the oldest staff profile of any major area). If you want a whole lot of happy-smile-at-you staff that don’t actually know anything, then teaching only places with staff teaching in areas where they have never worked in are the way to go.
Also the reason research is done in areas where students are abundant is obvious — because you have more staff in those areas and more post-graduate students also.
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Conrad – One of the issues I hope to address in my Grattan work. But my initial reaction is that we already have a large teaching-only workforce, in the academics who produce little or or no research, and the army of would-be academics employed on a casual or short-term contract basis. Plus we could offer better wages if we did not have to fund 5-6 months a year on activity that generates no income.
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“This helps explain why so many universities are significantly ‘over-enrolled’ – once the demand-driven funding system is fully operational they expect to at least break-even by avoiding research costs.”
Hi Andrew, can you explain this sentence? How do they avoid research costs?
Is it just me or is that first graph incredibly hard to interpret?
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Rob – By using casual staff. Teaching-only permanent staff also seem to be making a comeback.
Yes, the first graph is confusing. I probably shouldn’t have used it.
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