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The Senate hearings on university deregulation are over, and the sector is now in a state of anxious anticipation in advance of the committee’s report, due to be tabled on October 28. If deregulation does get through (and with most vice-chancellors now united in qualified support for change in the absence of greater government funding, it seems likely that it will), institutions cannot afford to be behind the eight-ball in their readiness to respond.
We asked several of the sector’s leading voices, all speakers at the Financial Review Higher Education Reform Summit in November, what they think are the most important strategic priorities on the cusp of deregulation.
1. Determine your overall market position. The first challenge for institutions, according to Queensland University of Technology VC Peter Coaldrake, will be to determine overarching principles for responding to fee deregulation. This will undoubtedly be a fraught process for many, as leaders struggle to define the essential mission of their institutions and balance economic imperatives with a commitment to access and equality. And it’s not just about fees.
“Institutions will also need to make decisions regarding the scale and scope of their activities in the new environment,” says Coaldrake, “for example, with regards to sub-degree programs.” Ultimately, it’s all about defining differentiated value propositions, and, as UWS Chancellor Peter Shergold advises, “Each institution should take pride in its unique identity.”
2. Know your competition. Make sure that you understand who your competitors are and what they offer – and don’t overlook private providers.
Claire Field, former CEO of ACPET and an expert in the private HE sector, points out that the non-university higher education sector already currently accounts for 8% of the undergraduate student market, and “with a more level playing field (the extension of government support to the non-university sector and removal of the 25% HELP loan administration fee) the non-university sector will thrive. It will increase its share of undergraduate places by encouraging new students into higher education – but it will also aim to take market share from the university sector.”
3. Don’t under-price. Hitting the sweet spot with regards to fees will be a dilemma for everyone. But Steven Schwartz, Executive Director of the Council for the Humanities & Social Sciences and a former VC, has a warning for institutions aiming to beat their competitors on price.
“Don’t under-price,” he says. “Income contingent loans reduce price sensitivity, and there is no market for cut-price universities.”
4. Don’t over-price. At the same time, however, our experts advise universities to also consider the bigger social and economic picture when setting their fees. Peter Shergold urges institutions to think about how they will ensure that higher education remains a pathway to social mobility and economic opportunity in the longer term, while Engineers Australia CEO Stephen Durkin warns that “decisions which affect today’s students affect Australia’s future capacity to grow.”
5. Figure out your costs. Developing the knowledge, processes and capabilities to consistently hit the right price points across the whole sweep of university offerings will be a major challenge, particularly when, as Steven Schwartz points out, many universities don’t actually know how much it costs them to mount a course. Getting accurate data and business intelligence is vital.
6. Find ways to improve the educational experience and better support students. “With higher fees come higher expectations,” says Claire Field, “and institutions need to be prepared to make significant improvements to areas of underperformance – particularly in relation to teaching – or lose students.”
Engineers Australia CEO Stephen Durkin agrees. “In a free market, the quality of educational programs and student experience will be a deciding factor for students who are deciding whether a university is delivering value worthy of the fees they charge,” he says, “so ensuring the standard of education is paramount.” In addition to improving teaching and learning, Peter Coaldrake advises that universities consider how they can better support student welfare.
“Institutions will need to develop processes and policies for extending student support,” he says, “both to minimise adverse impacts of higher student costs and to ensure that demonstrable value is provided for increased charges.”
7. Take greater responsibility for graduate employability. With students likely to enter into greater debt to pay for their education, employability – both in the short and long term – is likely to become a higher priority. Claire Field suggests reviewing graduate employment outcomes and developing policies to enhance employability, especially in faculties or disciplines where it lags below the average.
“As students pay more for higher education,” she says, “it is beholden on institutions to be more actively involved in ensuring their students do not struggle in the labour market immediately upon graduation.”
8. Communicate with current and prospective students. “Deregulation will take effort,” says Engineers Australia’s Stephen Durkin. “Undue haste and poor communication could create too much uncertainty for students as universities implement the reform – so we ask universities to take a sensible approach in keeping students engaged in the process.”
To learn more from the experts at the epicentre of the reform debate, including Minister for Education Christopher Pyne, Shadow Minister Kim Carr, policy guru Andrew Norton, numerous Australian Vice-Chancellors, and international keynote speakers from the US and UK, secure your ticket for the Financial Review Higher Education Reform Summit, 12-13 November at the Sofitel, Melbourne.
