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Higher education reform package enhanced .

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17 September, 2003 MIN 463/03

I am pleased to announce enhancements to the higher education reform package, Our Universities: Backing Australia’s Future, which will provide significant benefits to students and institutions.

A number of measures have been modified in the package to provide greater flexibility for institutions and a significant advantage to students, particularly those from low-income backgrounds.

As I have said previously, I am prepared to consider reasonable arguments for change that do not undermine the fundamental integrity of the package.

Universities and other stakeholders made a strong case on the following issues. The following changes will be of significant benefit to both students and institutions.

Including external students in the regional loading programme.

In the original policy, only on-campus students were included in the calculation for regional loading assistance. Universities have made a case that the provision of education for external students at regional campuses should also be acknowledged in the calculation.

The regional loading programme will now be calculated to take into account a proportion of an eligible institution’s regional external student population.

Significant beneficiaries of this enhancement will be the University of New England, Central Queensland University, the University of Southern Queensland and Charles Sturt University.

Extending the Student Learning Entitlement.

The announced Student Learning Entitlement provided students in a Commonwealth-supported place with five years of full-time study (extended where the duration of the course was longer). A five year limit provides those undertaking a three or four year

degree extra time to complete. However, where the course is longer than five years, students may need extra time to complete.

The Student Learning Entitlement will be extended to cover the duration of a student’s course plus one year where the course is five years or longer.

This will give students the flexibility to change their preference after commencing and allow for factors that may affect their progress, it will also help to improve retention in universities and reduce the number of students dropping out.

Lifting the current two per cent overenrolment limit to five per cent.

The reform package provided for a two per cent limit within which institutions could enrol above their target number of students. This initiative addressed concerns across the sector that overenrolled places, which attract a marginal funding rate, were putting pressure on quality and causing overcrowding. Institutions are currently overenrolled at around eight per cent across the sector.

Institutions strongly argued that the two per cent limit should be increased to give universities greater flexibility in planning their student numbers. Institutions argued that a higher limit would alleviate problems associated with accurately estimating acceptances, withdrawals and continuing students, a particular problem for smaller institutions.

The Government does not want a situation where large numbers of students are overenrolled and potentially compromising quality. However, it appreciates the planning challenges of institutions and has lifted the limit to five per cent. This will give institutions greater flexibility but will still keep overenrolments within a manageable range. A five per cent limit will provide for around 20,000 places across the sector.

As institutions’ overenrolled places are phased out to within a five per cent range over the next five years to 2008, approximately 25,000 new fully-funded places will be rolled out at a cost of $347.6 million.

Treatment of fee exempt scholarships for income support purposes.

Fee-exempt scholarships for low-income students, where the university determines that there is no fee for the course, will be excluded from the social security income test.

Currently around 2,000 of this type of scholarship are offered across the sector.

The Government will now allow institutions to provide fee-exempt places or fee-exempt scholarships to students whom they consider to be disadvantaged. This will not be counted as income for social security purposes. This mechanism will enable institutions to offer disadvantaged students access to courses without a fee and have no impact on their Youth Allowance, Austudy or ABSTUDY entitlements.

It is well-established policy under the Social Security Act, 1991 that receipt of financial assistance which is of immediate and discretionary benefit is to be counted as income for social security purposes. This approach maintains the integrity of the social security system while ensuring that students from low income backgrounds are treated in a fair and equitable manner.

Media contact:

Dr Nelson’s Office: Ross Hampton 0419 484 095