What does the Budget mean for Education?

The higher education sector is still facing unresolved issues following the Budget.

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 Key initiatives:

  •  An additional $1.2bn over four years, commencing 2017-18 for government and non-government schools. More broadly, total funding for schools is expected to grow by 3.6% per year, with adjustments for changes in enrolment.
  • In real (inflation-adjusted) terms, funding for public schools will increase by 11.1% between 2016-17 and 2019-20, and 7% for private schools.
  • An additional $118m is expected to be provided over 2016-17 and 2017-18 for school students with a disability.
  • Unlike schools, higher education faces funding cuts. In real terms, higher education expenses are expected to decline 2.4%, reflecting the Government’s decision to delay the full implementation of higher education reforms announced in the 2014-15 Budget and Mid-Year Economic and Fiscal Outlook (MYEFO) until January 2018. Expenses between 2016-17 and 2019-20 are expected to decrease 7.7% in real terms, due to the reduction of Commonwealth Grant subsidies from 2018.
  • The Government has decided not to proceed with the deregulation of university fees announced in the 2014-15 Budget. However, it has released a paper (Driving Innovation, Fairness and Excellence in Australian Higher Education), which considers a range of options including:

– A 20% cut for bachelor degrees.

– A lower income threshold for repaying Government debt.

– Raising the student payment burden from 40-50%.

– Flexibility around the deregulation of fees for courses considered ‘flagship’.

– Recovering income from deceased estates for those who die with unpaid HECS debt.

  • In nominal terms, the Government is expecting cuts of around $2bn stemming from this review, with the bulk of the cuts expected between 2018-19 and 2019-20.

For full analysis download the report (PDF, 923KB)