Higher education is at the core of the political challenges confronting the Albanese government, principally of boosting capital accumulation whilst safeguarding aspects of social reproduction. The Albanese government has prioritised skills training and an industry policy focusing on green energy, but this is at the expense of social reproduction including in areas of education.
The Accord is designed to support the production of ‘labour power’ via skill training and subsidisation of employers for job training but notably recognises that higher education is at the heart of the current social reproduction crises – evident in the shortages in trained employees in areas that are essential to ensure that labour is available for capital. Yet, at the same time, it shifts the cost of this to students – international and domestic- whilst remaining committed to fiscal austerity. The current student debt crisis speaks directly to this contradiction. By 2024 student debt is around $78 billion, ten times the figure of 2005, caused by governmental policies particularly three rounds of student contribution increases and the Coalition government’s student loan schemes, plus high inflation that is indexed into yearly HECS/HELP repayments, which has resulted in 3 million students in debt.
While the Albanese government speaks of higher education reform and building a new future, its approach is, according to Jayasuriya (2021) little different from the Morrison government market-driven higher agenda. The Albanese government’s education reform outlines in the Australian University Accord Final Report (2024) reads as more subtle as the government seek to train skilled workers and subside businesses through student placement, internship and work-integrated learning but is short on concrete proposals and financial details. However, the Accord process has been successful in incorporating business and the unions into the proposed reform agenda. For instance, the Business Council of Australia expresses support for a new higher education system that will be more ‘agile and responsive to industry’. The National Tertiary Education Union praised the review for recommending the removing ministerial vetoes from ARC grants and proposed university governance reforms.
The Australian higher education has become increasingly market oriented with the casualisation of employment, wage theft, the commercialisation of research and the systematic devaluing of education and universities’ public good. A brief snapshot of the privatisation of Australian higher education: 35% of tertiary education spending is publicly funded in Australia. That is, more than 55% of the total expenditure on tertiary education is privately sourced in Australia. Moreover, under neoliberal austerity, as outlined in the Accord (2024, 1) the proportion of university revenue sourced from Australian Government grants fell from 44.0% (or $7.1 billion) in 2000 to 36.1% (or $14.1 billion) in 2021. As a share of the sector’s total operating revenue, international student fees increased from 10.0% in 2000 to 27.3% in 2019 and in a range of universities international student fees outstrip government funding.
Minister Clare has promised to end the JRG scheme, however, the focus on skills is retained and amplified with the Accord recommending that labour market skill levels be raised. For example, the Accord (2024, 2) proposes the tertiary attainment rate of all working-age people rise from 60% currently to 80% by 2050 and increase the proportion of university-educated Australians aged 25 to 34 from 45% currently to 55%. The prediction is based on the Jobs and Skills Agency’s expansive guess that 90% of new jobs will require post-school qualifications to serve capital accumulation by the year 2050.
This sidesteps the history of skill formation in Australia, where businesses, especially large corporations develop their skilled workforce through sponsored immigration and the history of long-term labour market predictions that are more epic than precise. The Accord’s (2024,2) objective is to increase labour market skill training so that 57 per cent of the working-age population will hold a degree by 2050 and low-SES participation will rise to 20.2 per cent equal to their population component. The Accord (2024) recommends a variegated strategy adapting the Bradley (2008) review’s demand-driven model to the low-SES component and a Gonski-like needs-based funding for Indigenous and underrepresented cohorts, principally to increasing skills by segmenting universities into their capacities to serve sections of suitable sections of the labour market. It seeks to incorporate regional universities into the under-represented cohort recommendation, and it comes as little surprise that universities such as the University of the Sunshine Coast readily support the initiative. There is a gendered component of the skill training as most of the jobs in social reproduction are dominated by female employees such as nursing, childcare and aged care, where females comprise 80 per cent of the workforce.
Higher education and the labour market
The Accord (2024, 92) seeks to link higher education policy strategies to the production of a new post-industrial working class. It proposes seamless integration of Vocational Education and Training and the university system with what they call stackable and modular skills and even a skills passport. In practice, it will further ‘vocationalise’ the higher education system and more importantly create avenues for private and public-private partnerships. This is not remarkably different to the Morrison government’s skill focus, except now couched in the language of participation and inclusion. Notably, it is short-term thinking to fill the shortages in the service care (health, aged, child) industry, which was the same focus of the Morrison government’s JRGs approach, which reduced fees for nursing and teaching degrees.
Additionally, in term of actual students, most who work whilst studying, estimated at 86 per cent of university students work whilst studying there is the recommendation to guide students via ‘job brokers’ to link their part-time work to their career paths across a wide and differentiated labour market. The job agency idea aims to incorporate student-workers into designated jobs, aiming to fill the gap caused by the decline in employers’ conducting employee’ training. In part, it is a strategy to placate business complaints that there is a mismatch between student training and immediate productivity returns to employers. The job agency aims to function as a service for employers but at the expense of personal choice-making over careers and career changes by the students themselves. Again, it seeks to impose a conception of individual participation in the marketplace as against the idea of education as a mark of democratic citizenship that informed earlier social democratic arguments such as the Whitlam Government higher education policy.
Research and Development.
Minister Clare (2024) makes it clear that there are no extra funds for higher education and he would have to work within other government priorities. A major government priority is industry policy, especially green energy, but this confronts a systematic decline in public funding of R&D. For example, in 2008 Australian R&D expenditure was at 2.24 per cent of the OECD -GDP average but in 2022-23 it fell to 1.68 per cent. The main cause of the decline in R&D spending is falling government outlays on R&D, which were at their lowest level ever as a percentage of GDP at 0.49 per cent in 2022-23. In particular higher education expenditure on R&D, it was $12.7 billion, with only 30.1% funded via government research grants, the rest of the investment deriving from international student fees and discretionary funds, with eight universities amassing 60 per cent of the academic research budget. Given that government funding on R&D is declining it is hard to see how the Accord’s (2024) goal of 3% of GDP spent on R&D by 2035 and 2.5% by 2030, is achievable, especially as there was no clear mechanism outlined to reach the targets. Again, there is a larger R&D issue in Australia, as only three major industries (dominated by professional research centre) conduct substantial R&D, with the mining industry once leading the way but mining has high R&D in its startup phase but then declines.
This is evident in the following data Australia’s business R&D grew during the 1990s and peaked in years of the mining boom when it reached 1.38% of industry value-added and 1.28% of GDP. However, the rate then started to fall declining ever since. It is now at a meagre 0.93% – is at its lowest level in two decades. Furthermore, R&D is becoming tied to defence strategies and the US alliance. Morrison’s government-linked R&D to the US defence alliance and the AUKUS submarine agreement. This trend is now followed by the Albanese government. Australian universities are drawn into this defence funding which, since 2007, the US Defense Department has provided $394 million to Australian universities, with $60 million in 2022 alone, with American weapons corporations intertwined with universities. Similarly, universities will be further drawn into the US containment of China via these contracts but equally through the foreign interest security legislation with its focus on deterring Chinese research collaborations. This mililitarisation of the University system is brilliantly documented by Sian Troath.
Corporatism or financialization
The Accord’s (2024) proposed Tertiary Education Commission, which would have power over research, sectoral planning and university mission-based compacts bears the hallmark of past policies. It revives the failed commission model from the past which was abandoned for being too interventionist in university management and autonomy. In a similar vein, there is an interventionist approach in the proposed top-down funding model of a wealth tax on universities to fund the expanded enrolments. The Accord (2024) recommendations that the wealth tax from university surpluses be channelled by an overarching agency into a Future Fund of $10 billion.
The idea of taxing the universities that have surpluses is a form of legerdemain, as the original concept was to impose a levy on international students. In the new recommendation the surplus would come from universities with high international student enrolments. The reasoning behind the tax is made clear when Education Minister Clare said that ‘there’s no magic money tree here, and so we’ve got to look at how we do it, and this is just one of the ideas in that report’. It combines top-down intervention and financialization that reinforces the broader context of fiscal austerity, which governs university funding. If it is a financial fix for a political problem.
Higher education and the new activism
There is a crisis of social reproduction, including student debt, and casualisation of university employment in a society with broad social reproduction crises. The Albanese government caught between the contradictions of social reproduction and capital accumulation, has emphasized capital accumulation -, through a new industry policy with an energy focus. Prime Minister Albanese promised to spend at least $20 billion on the industry program to drive capital accumulation and investment in his Future Made in Australia program, with state intervention to bring government and businesses together to revive manufacturing. The ideas have been is influenced by Mariana Mazzucato’s Mission-Oriented Industrial Strategy with its inclusive green industrial approaches created by state intervention and an environmentally principled economy. Mazzucato is highly regarded by Treasurer Chalmers and met him and Albanese before the release of the industry policy. Not surpassing then that Mazzucato’s links to British Labour dovetails with policies proposed by Starmer. Albanese industry intervention and Starmer’s industry policy have at their centre an active state, trying to promote private investment- subsidised by the government – in defence, IT, and green technology – a new form of third-way militarised neoliberalism.
As we have argued higher education presents these contradictions starkly, the drive for increased enrolments and research to serve end users, however, without an increase in public funding. Rather, the higher education policy agenda is a rebadging of the Morrison government’s Job Ready program but given an equity tinge. The Accord fails to challenge the higher education contradictions of the marketisation of higher education, dependent on market solutions over public spending -outsourcing, commercialisation, casualisation, the reliance on international students’ revenue and growing student debt. Paradoxically the solutions to these contradictions in the Accord (2024) are for even more market-orientated solutions. Higher education offers a guide to the Albanese government’s overall policy agenda where reform is contained by public sector financial restraint, aiming to stymie inflationary pressure, but at the cost of genuine public reform of the deep-seated challenges of social reproduction, evident in growing student debt, housing and rental affordability and service sector shortfalls.
Time will tell if an interventionist state and austerity will prove effective for the Albanese government, nevertheless, what we do know is that the social reproduction crises are here to stay. It is symbolic of the new crisis of social democracy in an era shaped by deepening economic stagnation, growing ecological crisis, mounting problems of financing social reproduction, and intensified strategic competition in the Indo-Pacific. Given the narrowness of the policy agenda, policy proposals by governments, like the Accord, seem different but, in practice, the more it seems the same. It is a neoliberalism that is failing forwards.
Image: @JasonClareMP (X)
Author: Kanishka Jayasuriya
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