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New government review to examine uncapped uni places

The government has appointed former Howard government education minister David Kemp and leading education academic Andrew…

A new review into how the government will fund university places will report early next year. AAP Image/Julian Smith

The government has appointed former Howard government education minister David Kemp and leading education academic Andrew Norton to review the demand driven funding system for higher education.

Announcing the inquiry, Education Minister Christopher Pyne said that as a matter of “good practice” policies should be monitored to ensure they were working as intended. The review will report in mid-February.

Pyne has previously been concerned that there was “some evidence …that quality is suffering to achieve quantity”.

Labor brought in the system in 2012 which removed the cap on the number of university places the government would fund. The government now funds Commonwealth-supported places for all domestic undergraduate students accepted into a bachelor degree course (excluding medicine) at a public university.

The number of Commonwealth supported places has expanded from 469,000 in 2009 to 577,000 in 2013. Some universities leaders have called on the review to consider fee deregulation to deal with the rising costs associated with more students.

Kemp’s long political career as an advisor, Liberal party official and member of parliament included serving as minister in the areas of education, employment, training, youth affairs, environment and heritage.

Norton is the higher education program director at the Grattan Institute, and a honorary fellow at the Centre for the Study of Higher Education at Melbourne University.

In Norton’s own article on The Conversation, he has previously praised the current system, saying:

“The demand-driven system is the big higher education achievement of Labor’s term in office. It would be a policy tragedy to start unwinding it now.”

Pyne said he had asked Kemp and Norton to recommend possible improvements “to ensure the system better meets its objectives, is efficient, is fiscally sustainable, and supports innovation and competition in education delivery”.

Opposition higher education minister, Kim Carr warned the review could become “a stalking horse for increasing student fees.”

“Let’s not forget this review is being conducted by the former Minister and his adviser who oversaw the introduction of measures while in government for domestic undergraduate students to be charged full fees,” he said.

Higher education expert Gavin Moodie said given Kemp and Norton were proponents of the demand driven system in government, the review would be very “sympathetic”. He also said the review would likely consider reform options rather than overhauling the entire system.

These could include extending the system to private providers of higher education, reducing government subsidies for programs like law, business and the creative arts and reducing the inconsistencies with postgraduate programs (some of which are full fee paying and some of which Commonwealth supported places).

Researcher at the National Centre for Student Equity in Higher Education, Tim Pitman said the review was premature.

“We have had only two years of a demand driven system so it is too early to provide definitive answers,” he said.

But there were some early indications that the uncapped system was improving access to higher education.

“Overall, Commonwealth supported places have increased by almost a quarter over the last five years. A significant proportion of those places – about 20% - have gone to students from socio-economically disadvantaged backgrounds.”

Andrew Dempster, higher education policy adviser at Swinburne University, said the review’s balanced terms of reference “make it clear that it’s to be a genuine inquiry”.

But he said the government would face pressure from Australia’s “sandstone universities” to reimpose capped places. He added that since the introduction of the demand driven system “universities have responded by offering new opportunities for students and embraced new modes of delivery”.

Under its terms of reference the review will examine:

  • the effectiveness of system’s implementation, including policies on the allocation of sub-bachelor and post graduate places.

  • early evidence on the extent to which it is increasing participation, improving access for students from low socio-economic status backgrounds and rural and regional communities, and meeting the economy’s skill needs.

  • the extent to which the reforms have encouraged innovation, competition, diversity, and greater responsiveness to student demand including development of new modes of delivery such as online learning.

  • whether there is evidence of any potential adverse impacts on the quality of teaching and of future graduates.

  • measures universities are taking to ensure quality teaching is maintained and enhanced.

  • whether less academically prepared students are receiving the support they need to complete their courses.

The inquiry will take submissions which can be sent to

— with Michelle Grattan, Professorial Fellow at the University of Canberra and Chief Political Correspondent with The Conversation.

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14 Comments sorted by

  1. Rene Oldenburger

    Haven't got one

    Definitely to many social scientist walking around these days

  2. Riddley Walker


    David Kemp? They really are draggin out the dinosaurs aren't they?

  3. Matthew Clarke

    logged in via email

    I don't understand how it is beneficial to have open ended demand driven funding for universities. They are already selling a commodity disguised as education. Students are herded into higher education with a combination of extraneous pressures such as from parents, narrow sighted high school aims, misguided conceptions on what certain degrees will deliver for them in terms of a career and more... Selling a commodity to people in such a circumstance is dangerous when it costs so much to be educated…

    Read more
    1. Paul Richards

      integral operating system

      In reply to Matthew Clarke

      Matthew Di Marco wrote; "... oversupply of highly skilled students" It's called unemployment and a university degree is a minimum requirement in today's market for many, that or years of specialised experience.
      History tells us during the Great Depression education boomed and produced more graduates than in any other era. The sad truth is today's unemployment numbers have been disguised preventing any easy comparison, really just clever spreadsheet column changes. We are living in the era of denial…

      Read more
    2. Paul Richards

      integral operating system

      In reply to Paul Richards

      Paul Richards wrote; "five hundred billions dollars" Hmmm... five hundred million.

    3. Ken Alderton

      PhD student, former CEO

      In reply to Matthew Clarke

      The account you heard in Perth that said there is a 'massive oversupply of enginerrs" in Australia is absolutely dead wrong. There is a large and persistent shortage of graduate engineers in this country. The number of permanent visas issued to engineers undertheskilled migration program went from 1,528 in 2000 to 8,585 in 2012. The annual increase over the past few years exceeds 16%.

    4. Matthew Clarke

      logged in via email

      In reply to Ken Alderton

      Maybe 'massive' was used to exaggerate to further my point. The accounts are not wrong though because they are first hand. Granted this year is a tough market, there is still an oversupply of graduates. Worse, a component to finishing your degree at the university of western australia is that you must do 3 months work experience- something students are struggling to get.

      I don't think a rise in the use of skilled engineering visas reflects a shortage in undergraduate engineers either, there would be a whole lot of other factors that are leading businesses to do this.

    5. Ken Alderton

      PhD student, former CEO

      In reply to Matthew Clarke

      These are permanent visas not 457s. The importation of engineers is not a short term thing it has been going on for two or more decades in response to the lack of numbers of engineering graduates being produced. Employers and the engineering professional organzations have been screaming out about it for years. No response has been forthcoming. I have been permanently retired from a position that was plugged into the engineering world and I still get phone calls desperately looking for engineering staff.

    6. Gavin Moodie
      Gavin Moodie is a Friend of The Conversation.

      Adjunct professor at RMIT University

      In reply to Ken Alderton

      Note that since the demand driven system universities have responded to student demand by increasing offers to students in engineering by 14% (and science by 33% and health by 27%), well above the increase for all other fields of 10% (Norton, 2013: 15).

      Norton, Andrew (2013) Keep the caps off, Grattan Institute, Carlton, retrieved 7 August 2013 from

    7. Matthew Clarke

      logged in via email

      In reply to Gavin Moodie

      Is there another paper that takes into account the other side of the coin besides student demand? I couldn't find anything in that paper relating to studies in job placements etc.

    8. Gavin Moodie
      Gavin Moodie is a Friend of The Conversation.

      Adjunct professor at RMIT University

      In reply to Matthew Clarke

      Australian graduates' employment rates are reported by Graduate Careers Australia (2012). This reports the results of an annual survey of graduates some 4 months after graduation. It is therefore somewhat dated but it is the best data available, in contrast to employers' reports which are unreliable.

      Some employment rates from the 2012 report: average 76%, business 75%, chemistry 63%, computer science 75%, education 75%, engineering civil 91%, engineering electrical 88%, engineering mechanical 88%, languages 66%, law 83%, mathematics 66%, nursing 75%, physical sciences 75%, psychology 63%.

      Graduate Careers Australia (2012) GradStats, employment and salary outcomes of recent higher education graduates, retrieved 15 December 2012 from

  4. John Kelmar

    Small Business Consultant

    I was hoping that David Kemp was long forgotten, instead he pops up to undertake a University review. When he was Minister I asked him to examine the University I was working for because there was a high percentage of students who had cheated their way through their course.

    His response was to direct my allegation to a section of his Department which was incapable and unwilling to conduct any investigation. As a result nothing was done, and now we have graduates who are working in industry and the public service with little knowledge of their chosen field, with the result that mistakes are increasing, money is being wasted, and people are dying unnecessarily.