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Transcript of interview with Laura Jayes: Sky News Lunchtime Agenda: 24 October 2012: The future of universities; new apprentice incentive program; baby bonus

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SENATOR THE HON CHRIS EVANS Leader of the Government in the Senate Minister for Tertiary Education, Skills, Science and Research


24 October 2012

The World Today Radio National

Subjects: The future of universities

ELEANOR HALL: An independent review of Australia's university sector has found that no Australian university will survive to 2025 on its current business model.

Business advisory group Ernst & Young spent six months interviewing vice-chancellors, the private sector and policy makers in the higher education sector and has declared that the sector is on borrowed time.

The study recommends that Australia's universities consider more online learning options for students and better linkages to industry.

David Mark has our report.

REPORTER: Australia has 39 universities. According to Ernst & Young none of them will be around in 10 to 15 years unless they change.

JUSTIN BOKOR: Look, what we found is university models, university business models are living borrowed time.

REPORTER: Justin Bokor from Ernst & Young is the author of a report called University of the Future. That university is a very different place from the sandstone institutions of today.

JUSTIN BOKOR: This is a time for universities to really think about how they might look 10 years from now and transition to a new model.

REPORTER: His fundamental argument is that today's universities are too inefficient.

JUSTIN BOKOR: Their teaching is done two semesters a year, 13 weeks, four days a week. That's about 100 days a year and it's used for the rest of the year but not that much so, you know, they need to get much leaner to survive the next sort of 10, 15 years and beyond.

REPORTER: Ernst & Young compared 15 Australian universities and found 14 of those had more support staff than academic staff.

JUSTIN BOKOR: All institutions, all organisations need a range of support staff but it's not really the question of whether they need staff, the question is what's the ratio and are there leaner and more efficient ways of doing business?

REPORTER: Ernst & Young predicts only a handful of universities will continue to operate as they do today, that is running teaching and research programs. Even so, these universities will have closer links with industry and use more online resources.

It's proposing two other models.

JUSTIN BOKOR: Second model is universities that become much more focused and run three or four or five programs only.

REPORTER: The third model sees universities forming a myriad of partnerships.

JUSTIN BOKOR: Carving up the education value chain and maybe specialising in generating the content for university degrees or specialising in distributing university education in developed markets or into emerging markets in rural and regional areas.

REPORTER: Money is tight. Just this week the federal Government cut and deferred hundreds of millions of dollars in research and other funding.

Perhaps that's an omen. Ernst & Young predicts government funding for universities will continue to decline as a proportion of total funding.

Senator Chris Evans is the Minister for Tertiary Education.

CHRIS EVANS: There is a debate, I think, around the question of continuing funding for universities but the Gillard Government has vastly increased funding for universities.

We actually see the growth and the widening of access to universities as being a key social objective as well as an economic objective. We think the future for universities is strong but it does require a strong commitment from Government to continue to fund it as it develops.

REPORTER: Many people will be surprised to hear you say that given that you cut hundreds of millions of dollars in research funding only this week.

CHRIS EVANS: That's not actually right. We re-phased a massive increase in one particular program to have the rate of growth be slightly slower than it would have been.

REPORTER: Ernst & Young has pointed out that they believe many universities are operating incredibly inefficiently with far more back room staff than there are academic staff. Is that a fair assessment? Are universities too fat?

CHRIS EVANS: Look, I think all universities are looking at issues like that and, in fact, I think the other big challenge is the question of technological change and its impact on the way students learn and universities teach.

Universities are facing challenges like every other business. Technology's a big part of that; and how they are more efficient is a big part of that.

But these are changes, as I say, that affect everybody as we respond to changed circumstances. I don't agree with any conclusion that says universities don't have a strong future.

Australia's future is in having a highly skilled, innovative workforce and that's why we're growing access to university - 150,000 more students as a result of the Gillard Government's policies - and more funding, because we've got to be smarter if we're going to compete in the increasingly competitive international market.

ELEANOR HALL: That’s the federal Minister for Tertiary Education, Senator, Chris Evans, ending David Mark's report.