Crikey

No group in the community greeted the election of the Rudd government with more enthusiasm and more relief than the higher education and research sector. The Howard government had treated the sector to a decade of ideologically motivated cutbacks combined with a tribal history which reflected, in large measure, the defeats and slights its members had endured as student politicians in the 1970s and 1980s. The number of places for domestic students was effectively frozen for most of the Howard era, reflecting both a desire to pressure the universities into offering full-fee places and a belief that Australia did not really need a more educated workforce.

Rudd’s election on the platform of an Education Revolution offered not only the end of the long-running culture war between the government and the universities but a substantial, and much-needed, increase in funding. Even when the government’s budget delivered little in the way of extra money, most in the sector were willing to wait their turn.

Then came the financial crisis. Having spent billions on physical infrastructure, the government began sending signals that the Education Revolution would have to be postponed again. There was money for new buildings but, it seemed, there might be little left to pay for teachers and researchers to work in them. How did it all turn out on Budget night.

The backdrop to Wayne Swan’s press conference, a banner emblazoned with the slogan ‘Nation Building: Road, Rail, Ports — Jobs’ was far from promising. In its exclusive focus on concrete it summoned up memories of the failed Japanese response to the economic crisis of the 1990s.

But the picture brightened with Swan’s speech. Each time he talked about infrastructure he was careful to add ‘unis and hospitals’ to the concrete-intensive list on his backdrop. Presumably the government’s message controls were trying to give one signal to TV viewers looking at the visuals, and another, more sophisticated version to those who were listening to, or reading, the words.

Looking at the actual measures in the Budget, the government has promised to make university places available to all qualified students by 2012, meeting a key recommendation of the Bradley Review. And the COAG goal of 90 per cent school completion remains, though the aspirational date of 2015 offers plenty of room for slippage.

There is particularly promising news on innovation, where the recommendations of the Cutler review (and to some extent the 2020 Summit) have been influential. There a 25 per cent increase in this year’s budget, compared to 5 per cent in 2008-09.

And the CPI-based indexation imposed under Howard, which inevitably fell short of the actual rate of increase in the labour costs of research is to be replaced by a wage-based system of indexation. If it sticks, this reform will end the routine erosion in the effective value of research grants over time. On the other hand, it is hard to see how this (and many similar measures) will be consistent with the government’s desire to hold real increases in expenditure to 2 per cent a year after 2010-11.

Overall, the outcome is far better than might have been feared in the light of pre-Budget softening up, even if a fair way short of what might have been hoped for when the government was elected.