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Labor lets down universities.

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Senator the Hon Brett Mason Shadow Parliamentary Secretary for Education

Universities already struggling in uncertain economic times are facing further funding shortfalls, as the Rudd Government is turning the Coalition’s Higher Education Endowment Fund (HEEF) into an all-purpose education slush fund, according to Shadow Parliamentary Secretary for Education, Senator Brett Mason.

“The Coalition’s HEEF was set up to secure funding for the infrastructure needs of universities well into the future. The way in which Labor’s Education Investment Fund (EIF) has been constructed undermines that important purpose,” Senator Mason said.

In the 2007/08 Budget the then Treasurer, Peter Costello, announced a $6 billion HEEF fund, the interest from which would fund infrastructure projects at Australia’s universities. In Wayne Swan’s first budget, Labor took that $6 billion and rolled it into an $11 billion Education Investment Fund.

“The issue however is that the new fund is available not only to the nation’s 38 universities but also to hundreds of vocational education facilities, research institutions and conceivably even schools. By making the EIF available to hundreds, even thousands of extra organisations it is more than likely that universities will be worse off under the new arrangement,” Senator Mason said.

The total number of organisations entitled to apply is still unclear, but already this new arrangement is creating confusion, most recently with medical researchers who are uncertain if they can access the EIF or whether they have to compete with hospitals for funding under the health and hospitals infrastructure fund.

“What’s even worse for the integrity of the fund is that the capital can also be drawn down to fund grant applications, unlike under the Coalition’s HEEF, where only the interest from the fund could be used to fund projects,” Senator Mason said.

“This defeats the whole concept of having a secure ongoing source of funding for universities. Instead, Labor turned the fund into an all-purpose slush fund that is no different from ordinary recurrent expenditure. Under the Coalition this money was truly a fund for the future, under Labor it will be used to make big, headline grabbing promises in an election campaign, without any concerns for good economic management and funding sustainability.

“In the first year of funding under the HEEF arrangements universities have access to $304 million to provide much needed infrastructure upgrades on their campuses. Whether those kinds of funds will be available to universities in the future remains to be seen.

“Universities have a right to feel cheated. They were expecting big things from Labor’s ‘Education Revolution,’ but now they are faced with the prospect of having access to less money for vital infrastructure projects.”