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The Demand Driven University System: A mixed report card

Commission research paper

This research paper was released on 17 June 2019 and it documents what happened during the demand driven university system before it ceased in 2017.

The study explores what happened to young Australians during the demand driven system using administrative, population and longitudinal survey data. The study addresses two research questions:

  1. Who are the 'additional students' who enrolled in university under the demand driven system who would not have had the opportunity in earlier periods, and what are the academic and labour market outcomes they achieved?
  2. To what extent was the demand driven system more accessible to people from under-represented 'equity groups'? And what factors predict the under-representation of these groups?

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  • At a glance
  • Panel discussion
  • Contents

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Media release

Demand driven university system gets a mixed report card

The 'demand driven higher education system' drove a surge in domestic undergraduate enrolments between 2010 and 2017. This gave opportunities to a broader range of students, but with mixed success. Tens of thousands graduated and went on to well-paying jobs but many also dropped out.

"The chance of a university education has been transformative for many, setting them on a path to better economic prospects. But it is also costly — to students as well as taxpayers," said Productivity Commission Chair Michael Brennan.

The Productivity Commission report The demand driven university system: a mixed report card for the first time sheds light on the 'additional' students who went to university as a result of the demand driven system, and tracks their academic and employment outcomes.

More people from low socioeconomic backgrounds attended university following the expansion in the system — one of the policy's main aims.

But there was little improvement in participation for regional or remote and Indigenous young people, and significant participation gaps remain for all of these groups. And not all of the additional students succeeded: 21 per cent had dropped out of university by age 23 years, compared with 12 per cent for other students.

"But that isn't to say that a capped funding system is more effective," said Michael Brennan. "It can be too restrictive, discourage innovation and opportunity, and some people fail in that system too."

The additional students identified often entered university with poorer literacy and numeracy and lower ATAR scores on average than other students.

Literacy and numeracy skills of Australian school students are dropping across the board, with the average student falling behind a whole school year in maths since 2003.

Poor literacy and numeracy affects those from disadvantaged backgrounds the most, making them far less likely to go on to university and succeed academically.

"Our report doesn’t make specific policy recommendations, but it certainly points to areas where improvement is needed, regardless of whether or not funding is demand driven. Our school system needs to prepare larger numbers of young people for university, and many university students need greater academic support to succeed," said Chair Michael Brennan.

In its 2017 report Shifting the Dial, the Productivity Commission found that university incentives were not necessarily aligned with student needs, with teaching revenue being used to cross-subsidise research.

"The university sector needs to be motivated by informed choice much more than enrolling large numbers of students, bringing a stronger focus on student outcomes, quality teaching and support," said Chair Michael Brennan. "Government policy and university business models need to adapt to the ongoing shift to a mass participation model" said Michael Brennan.

The demand driven university system: a mixed report card can be found at www.pc.gov.au.

Media requests

Leonora Nicol (Media, Publications and Web) 02 6240 3239 / 0417 665 443

Key points

  • University education can be transformative. It is also costly in terms of forgone earnings, student debt and Commonwealth outlays, so it is important that students, taxpayers and the broader community benefit from the investment.
  • The ‘demand driven system’ in place between 2010 and 2017 was intended to increase domestic student numbers and give under-represented groups greater access. The results were mixed.
  • It was certainly effective in increasing numbers: the share of young people that attended university by age 22 years increased from 53 per cent in 2010 to an estimated 60 per cent in 2016, based on data from the Longitudinal Surveys of Australian Youth.
  • Multivariate regression analysis shows that the 'additional students' — those whose attendance can be ascribed to the expansion of the system — were drawn from many backgrounds. However, compared with other students, they typically had lower literacy and numeracy and a lower Australian Tertiary Admission Rank (most had an ATAR less than 70).
  • Many of the additional students succeeded. About half of the additional students graduated by age 23 years (with many still studying). About half of those graduates entered managerial or professional occupations, outcomes that are similar to those of other graduates.
  • However, people that enter university with lower literacy and numeracy and a lower ATAR drop out at higher rates. By age 23 years, 21 per cent of the additional students had left university without receiving a qualification compared with 12 per cent of other students.
  • University participation increased within some under-represented 'equity groups', but not others.
    • School students from a low socioeconomic background and 'first in family' students were more likely to participate in higher education following the expansion in university places.
    • However, the participation 'gaps' (compared to those not in the equity group) remain for Indigenous people and for people from regional or remote areas, and may have widened.
  • Despite the expansion, the level of participation among all these groups remains far lower than for people who do not come from disadvantaged backgrounds — a reflection of poorer average school performance and a range of cultural and environmental factors. In the latter respect, an equity group student with a given level of academic ability is still significantly less likely to attend university than their non-equity equivalents.
  • Overall, the demand driven system succeeded in increasing the number of students and made progress in improving equity of access. However, many are entering university ill-prepared and struggling academically. This study suggests some areas for further policy consideration:
    • The school system has arguably not adapted to the role needed of it to prepare more young people to succeed at university, or more broadly to meet the growing demand in the Australian economy for complex and adaptable skills. Average literacy and numeracy of school children needs to rise to fill this role, reversing the sharp falls since 2003.
    • Children growing up in regional or remote areas with the same academic ability as their metropolitan peers continue to be much less likely to attend university.
    • The growing risk of students dropping out of university requires attention. On average, the additional students need greater academic support to succeed. While universities had strong incentives to expand student numbers, the incentives for remedial support are weak.
    • University will not be the best option for many. Viable alternatives in employment and vocational education and training will ensure more young people succeed.

Video: The demand driven university system: a mixed report card

Transcript of video

[All Visual text - no spoken words]:

Between 2010 and 2017 universities could enrol as many students as they liked.

There was no cap on funding, this meant more students attended university.

We looked at the outcomes of this 'demand driven system'.

"The chance of a university education has been transformative for many, setting them on a path to better economic prospects. But it is also costly — to students as well as taxpayers."
Michael Brennan, Productivity Commission Chair

Our study defined two categories of students:

  • ADDITIONAL - attended uni because of demand driven system
  • OTHER - would have attended uni anyway.

We measured their outcomes and characteristics. By age 25:

  • 68% of Additional students graduated
  • 80% of Other students graduated
  • 20% of Additional students dropped out
  • 12% of Other students dropped out
  • 73% of Additional students had an ATAR below 70 or received no ATAR
  • 28% of Other students had an ATAR below 70 or received no ATAR

Additional students often enter university with poorer literacy and numeracy and lower ATAR scores than other students.

"The numeracy and literacy skills of Australian school students are dropping across the board, with the average student falling behind a whole school year in maths since 2003. This contributes to inequity. Our report shows that poor literacy and numeracy affects those from disadvantaged backgrounds the most, making it far less likely they go on to university and succeed academically."
Michael Brennan, Productivity Commission Chair
  • 32% of Additional students are from a low socio-economic background
  • 15% of Other students are from a low socio-economic background

More people from low socio-economic backgrounds attended university, one of the policy’s aims.

  • 65% of Additional students are first in family students
  • 45% of Other students are first in family students

"first in family" students, whose parents didn't attend university, were more likely to participate in higher education following the expansion in university places.

  • 18% of Additional students are from regional and remote areas
  • 25% of Other students are from regional and remote areas

Children growing up in regional or remote areas continue to be much less likely to attend university.

  • 60% of Additional students are from government schools
  • 47% of Other students are from government schools
  • 11% of Additional students attended a Group of Eight university
  • 29% of Other students attended a Group of Eight university
  • 30% of Additional students take vocational training prior to university
  • 10% of Other students take vocational training prior to university

Additional students are more likely to study:

  • Education
  • Information technology
  • Management and commerce.

Other students are more likely to study:

  • Engineering
  • Science.
"Our school system needs to prepare larger numbers of young people for university, and many university students need greater academic support to succeed."
Michael Brennan, Productivity Commission Chair

Read the full report.

Watch our panel discussion.

The Productivity Commission held a live streamed panel event to launch this report on 17 June 2019.

The Commission was joined by an expert panel to discuss higher education, school achievement, access and performance and potential policy solutions.

  • Michael Brennan - Chair, Productivity Commission
  • Megan O'Connell - Education policy consultant
  • Prof Sue Trinidad - National Centre for Student Equity in Higher Education
  • Andrew Norton - Grattan Institute

Transcript of video

Introduction

Ben Dolman: It's a great pleasure to welcome you all here to our offices here in Melbourne and for those watching on the livestream to join us for the launch of the latest research report The Demand Driven University System: A mixed report card and for a panel discussion of the broader questions around higher education access and outcomes.

Before we begin, I'd like to acknowledge that Wurundjeri people of the Kulin nation, the traditional custodians of the land on which we meet today and pay my respects to their elders both past and present.

We will have time for questions later in the event after each of our panelists is presented on their particular areas of research interest and I ask that you save up for your questions until that time.

So now to our panelists the seminar today brings together four experts in education policy and research. We have Michael Brennan, Chair of the Productivity Commission. Education consultant Megan O'Connell. Professor Sue Trinidad from Curtin University and Andrew Norton from the Grattan Institute.

And what we want to do with the session today is to explore different perspectives and different aspects of the challenges faced by people growing up in disadvantage and how universities can best work for them.

So by way of introduction our first speaker will be Michael Brennan. Michael is Chair of the Productivity Commission. He has previously been Deputy Secretary of the Fiscal group at the federal Treasury. In that role, he advised on budget policy, retirement incomes, Commonwealth-state relations, social policy and infrastructure financing.

Prior to that role he was Deputy Secretary in the Victorian Department of Treasury and Finance, so he has a long history of involvement in social policy design and funding at both Commonwealth and state levels.

Mike will be introducing our paper today, Michael.

The demand driven university system: a mixed report card

Michael Brennan: Thank you very much Ben. So when Ben said we had four education experts on the panel he was 75 percent right, we certainly have three.

I'd like to thank all of you for coming in today to the Melbourne offices of the Productivity Commission and also to thank you to those who've joined the livestream.

We wanted to bring together this group and this panel to put out some research that we think is important in respect of one of the most important reforms to the higher education system in the last three decades.

We start from the premise that the university education is a very valuable thing. It enriches lives and it helps us build the skills base that we need for future economic growth but it's also costly. It's costly to taxpayers and it's costly to students in terms of accumulated debt and forgone earnings.

So can you have too much of a good thing? How much is enough? And who ought to decide that? Because since we've had the demand driven system fully implemented since 2012 we've left that choice to universities to determine how many students they wish to enroll and whom, and to students themselves to work out whether university was right for them.

So what were the results? Well as always it turns out that answering that question is a lot less straightforward than it seems. So the first thing we know is that enrolments rose significantly under the demand driven system, up by around 36 percent between 2009 and 2017.

Enrollments have grown such that we now believe that 60% of 22 year olds have attended University and that's part of a long-run trend with or without the demand driven system we have seen over a 50-60 year period the movement of the higher education system away from what was a narrow elite province - to something more akin to a mass participation model and much of our current debate comes back to that question of how well our institutions, our universities, our school system and public policy in general has adapted to that broad trend.

The key thing is that until now very little has been known about the additional students. Those students who studied as a result of the demand-driven system but who would not have studied but for that system and the key thing is that identifying those students is not easy because if you think about all those students have enrolled who've enrolled in university since 2010 well obviously a large number, the majority, would have enrolled under the previous system.

It's the question of who were those additional ones who owe their university opportunity to the demand-driven system itself. So how did we do that?

Well we did it in part by looking at the longitudinal survey of Australian youth and looking at the characteristics of students who were most likely to study

under the previous capped system and comparing that to the students most likely to study under the demand driven system and to the extent that a student had a much higher propensity to study under the demand driven system to that extent they were counted as an additional student and what we wanted to know were three things: we wanted to know a bit about the characteristics of those students, their attributes, where did they come from?

Secondly, we wanted to know how did they fare at University and the third question that we wanted to ask was did those students fundamentally change the composition of the cohort that studies at University, did we broaden access as well as increasing access?

So the most obvious point to make is that students who came in under the demand driven system as additional students had lower ATARs so 73% of these students had an ATAR are below 70 or they came in with no ATAR at all. But some other interesting facts, perhaps surprisingly, these students were disproportionately from low socio-economic, the lowest socio-economic quartile. That's a very unusual thing in university education and sixty-five percent of them were the first in their family to study, that is they didn't have a parent who attended University.

They were also less likely to come from a rural or regional area. That bears repeating, so what other whatever other attributes and elements of diversity that this group brought they were overwhelmingly from metropolitan areas.

They're also more likely to go to a government school, they were less likely ultimately to end up at a group of eight University - group of eight university certainly expanded enrollments but typically they're expanding enrollments by taking in students who would otherwise be somewhere else in the system they didn't really touch this cohort and they tended to study courses like education IT and commerce.

Now because we had a longitudinal data set we were able to get in our time machine and go back to these students school days and look at their literacy and numeracy scores at age fifteen when they set the PISA test and what we found was perhaps not unexpectedly was in addition to having lower ATARs these students also had slightly lower literacy and numeracy at age fifteen, on average, and as you can see from the chart on the left we are talking about on average there is an overlapping distribution but on average it's true that the additional students came in with lower literacy and numeracy than the other students and that probably meant that they had naturally a more challenging task in adapting to university.

So how did the additional university students fare? Well one thing is they're less likely than other students to have completed their studies by age 23 many of them are still studying there was a higher tendency to study part-time but a significant number dropped out the dropout rate was around one in five compared to more like one in eight for the other students.

When we look at their transition to the labor market by age 23, of those who graduated, fewer were in full-time work at age 23, fewer were in professional occupations and more of them were unemployed and interestingly there was a higher unemployment rate among the additional students at age 23 then there is for students who never went to university or even for those who dropped out of university whether there were additional students or other students.

So it does appear that the transition to the labor market for this cohort of additional students was less smooth than it was for other students at university.

But now for the good news, I know you wanted some! By age 25 those outcomes were starting to converge such that most of the graduates had achieved were in full-time work and the gap in terms of those in a professional occupation had converged and the unemployment rate was considerably lower.

So a less smooth transition but a broadly similar end point for these additional students and that's part one of our mixed report card as we've called it, so a higher dropout rate among the additional students, a less smooth transition to the labor market by age 23 but by age 25 we see a situation where of that cohort of additional students two-thirds of them have graduated, the majority are in full-time work, many in professional jobs, earning a reasonable graduate salary.

Now did they do better than they would have done had they not gone to university?

That is a very difficult question to answer for two reasons: the first is that the earnings premium which a university graduate can expect emerges gradually over time and it continues to expand over a workers 20s, 30s, 40s and we just haven't had the time to see the full life path and expected earnings here but it would also require us to match these people up against those who studied in the VET system who had similar qualifications.

We're talking here about a cohort who might have been expected to do quite well in the VET system so this is an area potentially for future work.

Now to our next question: Did the demand-driven system fundamentally change who went to university?

The first point to remember here is that university attendance is overwhelmingly weighted in favor of relatively higher socio-economic, metropolitan, non-Indigenous and students (and those) who have a parent who went to university.

So we looked at four equity groups here, low socio-economic students, that's the bottom quartile, regional and remote students, Indigenous and first in family. And this chart shows the participation gap for each of those equity groups, it basically compares the university participation rate for each of them with the university with the participation rate for those not in the relevant equity group.

Now what we then tried to do is to put a bit of rigor around what it is that drives this participation gap, but broadly you can see is coming down to two things the first thing is that the students in the relevant equity groups have lower ATARs and when you go back to age 15 have lower literacy and numeracy than those who are not in the equity groups so that's an inequity in educational attainment that opens up during the school years and that remains a significant policy challenge.

But I guess what's more stark is even when you allow for that gap in educational attainment students in the lot in the equity groups are systematically less likely to attend university than their counterparts who aren't in those equity groups. So to illustrate that this chart groups students according to educational attainment as measured by literacy and numeracy at age 15 in the PISA test.

So what you can see is here if you rate relatively high in the top quartile for literacy and numeracy at age 15 you have a pretty high university participation rate and that is true whether or not you're in an equity group or a non-equity group. There is a participation gap but overall participation rates are high and that's true in 2010 before the demand-driven system and it's true in 2016 in the midst of the demand driven system.

But now look at the bottom half of the distribution, the lowest two quartiles.

So these are people with relatively low literacy and numeracy but for those who aren't members of an equity group they still participate in higher education in relatively high numbers whereas participation for the low SES (socio-economic) groups that the various equity groups, so the low SES, Indigenous, first in family or regional and remote, fall away and if anything between 2010 and 2016 that participation gap has actually expanded.

It closed a bit in the middle to high group. And of course I can't let the occasion pass without noting that PISA scores for literacy in numeracy since 2003 have been on the decline and they've been on the decline across the board. It's true for the equity groups and for the non-equity groups, it's true across government, independent and Catholic school sectors.

So it remains a significant challenge both overall but also in terms of correcting for some of those inequities. So here what we've tried to do is to isolate how much of that participation gap can be attributed to lower literacy and numeracy and how much of it is effectively due to all the other factors that might come in to an individual's decision whether or not to attend university.

So what this really illustrates is say for regional and remote students the gap in literacy and numeracy explains 18 percent, very little of the gap in participation. The rest, the other 82%, is all those other factors: the cultural, environmental, economic factors including cost that might mean somebody in a rural and regional area does not attend University.

So in other words a student in a regional or from a remote area, if you compare them to a student in a metropolitan area with the same level of educational attainment, they have a systematically lower likelihood of attending University and you can make a similar observation in respect of Indigenous students.

So overall the equity story is like the outcomes story, a bit mixed. Students from low socio-economic backgrounds increase their participation rate in the demand driven system, as did students who were the first in their family to study but for Indigenous and for regional and remote students there was no improvement in their overall participation rate as a proportion of the larger group, arguably there was a deterioration.

Now maybe that's to be expected because the sorts of barriers that such people face to studying and not the sorts of things that are easily removed or ameliorated by simply opening up greater access to the university system, they're more complex and they're more structural.

So what does this all mean?

Well firstly, we deliberately haven't made specific policy recommendations but we we do think there are four broad themes that it's worth thinking about in

terms of general policy implications.

The first is that the falling level of proficiency in literacy and numeracy in Australian schools remains an ongoing policy challenge both the absolute decline but also the inequities that emerge between higher and lower socio-economic students, for example the equity and the non equity groups.

The second broad conclusion is that universities arguably have incentives and business models which are more focused on enrolling additional students less focused necessarily on ensuring that there's the support and the help to ensure that students, particularly those coming from a more disadvantaged background, have the wherewithal to succeed at university.

Thirdly that Indigenous and regional and remote students face more significant structural barriers to participation in university and ones that aren't easily addressed simply by opening up access to the system. And finally that a demand driven system works best when the viable alternatives are strong. So when the labor market for school leavers is robust and when the VET system is working well then the demand-driven higher education system effectively can work more effectively but in the absence of those two things there is the risk that more students are going into the higher education system than perhaps would be desirable ideally.

With those things in place with all of those policy things solved, big big issue, that a demand driven system would probably work pretty well.

I'll just finish on two things before I hand over to the remainder of the panel.

The first is just to note that this work that we've done is consistent with what we try to do with the Commission - with our research program in general. We try and find areas where we can make a strong quantitative analytic contribution to a policy area which has significant policy implications.

I do just want to thank, note embarrass, the team who put this work together which was really led by Ben, our compere today, who provided the intellectual drive and leadership behind this work but also the team of Marco, Ishita and Max who did all the quantitative analytic and research work towards this.

The final thing is to understand what our work is not, as I've already said, it's not a menu of specific immediate concrete actionable policy items, it's more general than that, and nor is it a full-blown evaluation of the demand driven system, for that we would need to effectively tally up the costs and the benefits of the system.

What we've endeavoured to do is to simply provide a bit of evidence that we've put out to prompt a bit of further debate.

There are a lot of issues that remain unaddressed and a lot of questions that remain unanswered.

That's why we have the panel. So on that note I'll hand over.

Ben Dolman: His presentation had a lot there that I'm sure we'll come back to in the questions at the end of the session and indeed thank you for the kind words.

Start at the very beginning – improving outcomes for young people

Ben Dolman: Michael spoke a bit about the importance of literacy and numeracy in determining access to University and also the outcomes that students achieve. And with that in mind our next speaker is Megan O'Connell will be talking about how these inequities open up during childhood and what can be done about them.

Megan is a public policy expert with experience across early childhood, school and tertiary education sectors. She has a long history in developing research driven policy and effective programs targeting young people who are likely otherwise to make poor transitions from school to further education and employment.

Megan was previously director of the Mitchell Institute and she is now honorary senior fellow at the Melbourne Graduate School of Education.

Thank You Megan.

Megan O'Connell: Excellent, look thank you for the opportunity to talk today, I'd like to as the title of my presentation says start at the very beginning so talk you through the journey of some of these children and young people who may not make their way successfully through higher education.

So my presentation for all they will look at a child's journey from early years through to University and look at things like early and early disadvantage aspirations and pathways and some things that I think might help along the way.

So one thing we know about children is not all children have the same early chances as everybody else. We know about 60,000 children, about one in five children start school behind their peers.

Every year we have a census in Australia called the Australian Early Development Census and that's conducted every three years, every child in Prep, every three years, a teacher marks off this instrument and from that we get a national measure of how many children are on track so how many children are likely to go quite comfortably through school without any extra intervention needed and how many are behind.

And this census looks across five areas of vulnerability that we know make the biggest difference on a child's life course so it looks at physical health and well-being. Can kids hold a pen? Can they sit up straight for long enough? Social competence, so can a child manage their emotions as best to expect from or for a five-year-old? Emotional maturity, you know, are they able to also engage with the people next to them.

Language is a big one, do children actually come to school with enough words to be able to understand the teacher and to communicate what they want? Not quite big enough and what we find is that you can look through the AEDC at certain cohorts of young people what we find is from the very start certain cohorts of children are different to others.

We find that boys start school way behind girls, this does even up a bit over time.

We find our Indigenous students start school way behind their non-Indigenous counterparts.

Most and least disadvantaged areas, so if you happen to be born in a poorer suburb you are far more likely to start school behind your peers and if you're born in a more wealthy suburb and interestingly very remote and City in fact any sort of regionality places you behind your peers and that's tempered a little bit by socio-economic status but not entirely being away from the city does mean you're more likely to be more vulnerable.

And I had a bit of a play with this start, looking at one of the key academic domains, which is language.

We've heard a lot about how children have, you know, there's a million word gap or a thirty million word gap, it's a little contentious there but students who start school - children who start school with more words are more likely to achieve their NAPLAN benchmarks more likely to finish school to go on to higher education.

And we find by looking at the language domain is that certain children fare even worse than they do across the broad indicators so Indigenous students fare a lot worse than we would expect because it's not just down to language, our language background other than English students don't fare near as badly so there's something else going on there.

We find that there's a huge gap between our most our least disadvantaged areas and we find that that remoteness factor appears even more strongly here, that children in very remote areas aren't hearing the same number of words, aren't able to process information and to indeed make themselves known at school the same as other children are.

So I had a bit of a play then looking at some of our communities because the AEDC does fantastically you can actually you can dig into various communities across the country and what I did with this is I had a look at our most wealthier high socio-economic community and our lowest socio-economic community.

And what I found by looking at these communities is there's really stark differences, it's really tiny to see here, but our highest socio-economic community is Ku-ring-gai and it has vulnerability of about 13%.

So some kids are vulnerable some children are vulnerable in every single community across Australia but what we see looking at this data is that for the children of Ku-ring-gai they're likely to attend multiple types of early learning they almost universally attend preschool, most of them will attend long day care as well, quite a few of them also attend playgroup.

So they have lots of interactions with other adults that are able to provide parents with assistance. Give parents some guidance if the children might have special needs as they do across the whole of the country.

So we do find that you know a small proportion of kids in that suburb are referred because they have special needs.

There's not that many students that need further assessment upon starting school.

Then if you look at almost the opposite suburb of Murgon, so we've got a suburb that's in a regional area it's a heavily Indigenous place, about one in two children there start school behind their peers. They're far less likely to go to forms of early learning, most of them go to preschool, perhaps not for the full 15 hours a week, some of them go to some forms of playgroup or go to some long daycare as well but they have far less contact with other adults.

And about one in three of those children end up having special needs when they start school so they might have things and this comes back to the language slide before, they might have things like hearing disorders, which is why their language hasn't developed. They might have speech disorders, they may not be able to see properly, they might have some undiagnosed health conditions that are going to get in the way of their learning and need to be addressed.

The other thing I looked at in this data is what different starts most socio-economic make compared to regionality, so I had a look at Brimbank, which is a low socio-economic suburb/council area in Victoria. About one in four kids there are disadvantaged.

And then I had a look at Wellington, which is down out of south east of Melbourne here near Gippsland, a similar number students of there are disadvantaged even though it's a much higher socio-economic suburb than Brimbank is, because what appears to happen is that whether you're away from the city or if you have socio-economic issues you have troubles accessing the services that you might need to get your child started off on the right foot.

You also find that things like workforce issues in our early childhood centres be they are centres our low socio-economic areas or actually go further away from the city, our childhood centres struggle to get highly trained staff and this continues on when we start having a look at how this disadvantage goes on in schools because we know that most kids attend school most of the time but for a core number of students they're actually not there for a significant amount of time.

They're missing around about a month of school every year so if they make it through two years 10, 11 or 12, they've missed at least a year of schooling and this is particularly profound if you have a look at our remote and our very remote communities there but we find that our very remote students are more likely to not be in school at times then they're more likely to be in school.

So this adds up to a whole lot of learning that's lost. Across government primary schools about 350,000 students missed 10 percent of school about a month a year and then this rises as a proportion as we look at the further and further away from a city you go.

Now it's not just attendance that we need to think about though when we think about who's going to higher education. We need to think about aspirations and barriers to children actually living out those aspirations. We know from some studies that have been done, mainly overseas, on four and five and six year old kids, they all have fairly similar aspirations. They all want to be the things that they see in books, that their parents tell them about, you know, they want to be doctors, they want to be soccer players and footy players and policemen and firemen.

They look fairly similar when they're really little and then you get to eight or nine and the realities of life start to settle in for some of these kids and instead of wanting to be those things that may require them to stay at school for a long period of time they start to they start to narrow down and think about what might be realistic and that's based on what they can see around them.

If they don't have touch points with, still going to say touch point with industry, that sounds really grand but if they don't know people that work, if they don't get to hear about different sorts of jobs, if that isn't part of their daily reference, it is hard for them to think about where they might go next.

There's also a big gender bias in this, we know that young girls in particular start to narrow down their options when they're still in primary school. If they don't see particularly with STEM, if they don't see models of science and maths that make sense to them, they don't see engineers being caring or doing things that they'd like to do, they tend to start to exclude those options and potentially not focus as hard.

We know that children need multiple touch points with industry so they need to go out and do work experience, they need employers to come into the school, they need at least four different interactions throughout their primary and secondary school engagement to actually start to make more valid career choices that that might suit them down the track and this means that we need more dedicated career advice.

Career advice in Australia is patchy, it happens in some places and not in others, traditionally it happens at Year Ten. Career advice is about what subjects do you want to choose if you're going to go on for Year 11 and Year 12 that will inherently maximise your ATAR score. Now what we know is that some young people aren't that great at figuring out what they like and what they're good at.

We know this is a particular problem for our low socio-economic young people, the LSAY data that was used for this report and can also be sort of jumped into and had a look at as far as, how do young people recognize their skills like their enterprise skills, their critical thinking, their creativity, their collaboration.

What you find by looking at LSAY is that academically bright young people from low socio-economic areas don't recognize those skills that well. Some of them will think they have them some won't whereas if you look at your high socio-economic students they will think in droves and be able to talk about the fact they have these skills so we need to do a better job at encouraging our students, at showing our students, ensuring they can showcase the skills that they have and ensuring they can recognize them as they start to plan their futures.

We know there is a level of Uni-bias, University bias in our schools if schools are advising students on where to go it's generally a careers teacher that's been through university and that's her main or his main frame of reference with where students should go. So it's hard for students to see the whole range of options and this means there can be a big mismatch between a young person's aspirations if they know where they want to go and then the pathway that they undertake.

And this was just a small table from the latest VET review that was undertaken that shows how many young people actually want a job that will require vocational qualifications in particular but do end up undertaking a bachelor's degree. There is a small amount of mismatch in the other way as well but it's the bachelors one where nearly nearly half the students aside now I want to do something that requires me I need vocational education or they should know that they need vocational education maybe they want to be an engineer but more of an applied one maybe they want to be a web designer but they default to going to university. I do wonder how many of these students feature in the figures that we've heard today.

So what do I think would help? I definitely don't have all the answers here this is more a grab bag of ideas that I'm interested in.

Early education and parental support, one of the keys to getting more students, more students from equity groups through has to be starting early and trying to stop that early disadvantage. Career education models trying to figure out what actually works. It's all well and good to say we need to start having these conversations in primary school but we don't actually have any living proof of examples that that work out there.

They're happening in small centers and towns, often philanthropically funded, generally not evaluated, we don't really know, we need to build a better evidence base on this. We need to help all learners see their growth and progression so what are you good at? What do you want to develop over time?

We should be looking at alternative models potentially, how do we combine more work and study? If part-time study doesn't work for lots of people - there's such a high dropout rate - what else can we do about that? And is there a way we can help our students get credit for these part degrees if students are dropping out at those rates? What learnings can they actually gather for that? Is there a role for something like micro-credentialing in there?

Thank you.

Ben Dolman: Thanks Megan for that fantastic presentation, in particular emphasising some of the difficulties for young people from disadvantaged backgrounds in choosing pathways through education and into careers.

The Ripple Effect: Student stories and evidence-based research

Ben Dolman: Our third speaker is Professor Sue Trinidad and she'll be talking to us about what the demand driven system meant for individuals whereas there was a lot of focus in the Commission's report about what we see in the data in terms of changes in who attends University and how they fare. Sue's going to focus down and what it means very much at a personal level.

Professor Trinidad is Director of the National Centre for Student Equity and Higher Education funded by the Australian Government and hosted at Curtin University. This is a role that she's been in since June 2013.

She was previously Deputy Pro Vice-Chancellor and Dean of Teaching and Learning in the Faculty of Humanities at Curtin also. She has overseen extensive research including on the higher education participation and partnerships program on the outcomes for low SES Indigenous and regional students and in various other areas of higher education.

Thank you Sue.

Sue Trinidad: So congratulations to the Productivity Commission on their report launched today. This is an important report which makes a stronger case for more discussion around what needs to happen in schools and the whole educational life cycle when looking at University outcomes. By the time disadvantaged and marginalised students enter university they need extra supports in place to ameliorate the barriers to succeed.

The educational life cycle in this context shows that there are mixed results, as you've just heard, such as the risk of going to university if you are an equity student, financial burdens and distance from university and all of this plays a role in dampening access, particularly among regional and remote students in Australia.

So the Australian Government Department of Education under their access and participation program is working to ensure that all people with the desire and the capability to attend to university have the opportunity to do so and succeed in their studies regardless of their background and that's a key.

So the Higher Education Participation and Partnerships Program (or HEPPP) is one of these programs and I wanted to highlight the benefits of and a case for the need for the additional funding that's been spent on equity students in order to improve retention and completion rates.

There's also a strong case for bolstering support for regional students and a number of initiatives are underway such as the regional study hubs across Australia and the importance of university enabling and bridging programs which allows students to try to test university study before they're fully committed as not everyone is suited to University study.

So there is a ripple effect which I want to just briefly talk about and we all understand that education is transformative, therefore equity status is important and this effect is present among equity students to a greater degree. So as part of our brief at the National Centre, what we've been doing is building the evidence base.

We've produced a series of 'my student' voices where students across Australia have been able to share their individual life changing stories, of their triumphs to succeed in study at the higher education level. And I wanted to just give you a quick snapshot of some of those students coming through university supported HEPPP funded programs.

And these students all presented at the World Access Day to Higher Education last November in Australia where we ran that part of the conference joining with the UK and other countries to promote equity and access and participation in higher education.

So you can see here, Jonathan and he has overcome significant barriers to success. He was streamed out of ATAR but he's still aspired to go to university, so with the support of Canning College Flying Start Program and the Murdoch On Track Program, Jonathan has experienced significant personal growth both mentally and academically through higher education and would you believe he's currently completing his doctorate and he gained a first-class honors in psychology and philosophy at the undergraduate level.

Jed Fraser is one of our Aboriginal people coming through and he's studying a graduate diploma in public health at QUT and he is passionate about Indigenous education and works with Indigenous youth to inspire further post-school study. He's received a number of awards and his work in the Indigenous communities allows him to be an ambassador for the Explore the Uni Program helping others.

Tahlia she was first in family to complete school and attend university. And Tahlia has a unique perspective on higher education because she's actually spent the last five years working in school outreach programs for metropolitan and regional universities to ensure that other disadvantaged young Australians realized their real potential and just like Jed, Tahlia is giving back to the community and she is on a mission to tackle educational equality in Australia by supporting students from disadvantaged backgrounds to improve their access to and attainment in higher education.

And Arshya, she has grown up in a remote area of Western Australia and participated in the aspire UWA program that offers regional students in regional areas of view of University and making it an achievable goal. So benefits you often find with such students is that they'll go back to their communities and become contributing members in their regional towns and Arshya appreciates that university can be scary and unfamiliar but it is important that students understand their circumstances don't have to define what they can do.

And Helen is a mature aged student living in a country town in Queensland and born with a physical disability she competed in the workplace until an increasing loss of mobility ended her career in finance. Helen is continuing to work in the online world and without the Internet she could not achieve her goals, and she was quoted in saying the greatest benefit of my disability has given me the strength against adversity and the second is my love of creating and learning online. My next mountain may be my doctorate.

And Mitchell here's a Vietnamese Australian graduate of the University of Sydney and first year English high school teacher and it was through the financial and social support of the Smith family that Mitchell found inspiration and resilience with him within himself to overcome the barriers of poverty and achieve his goals and there's his very proud mother at his graduation.

So building the evidence base of research, we've been able to put together and fund often unique research projects such as this original piece of research that was conducted with Andrew Harvey at the La Trobe University. The impact of our original funding of the La Trobe care leavers research has led to a report that has inspired multiple Australian universities to develop programs for care leavers and has led to a large multi institutional national priority pool grant and then a Meyer foundation large grant as well as Victoria government funding.

So this has led onto five-fold increase in care leaver students across two universities being able to participate in university study and several other programs have followed on from there. So this is an example of the ripple effect that I want to highlight and you can see the student there Nicola-Jean Berry, her story is one where she grew up in northwest coast of Tasmania and from the ages of three to ten she spent time in and out of the foster care system becoming a ward of the state at at 11. Now at 24, Nicola-Jean is a first year student at La Trobe University in Melbourne studying social work and she wants to be able to support others. Give them the support that she did not have herself.

So we have a huge number of publications at our website and I have a card for those who are interested in coming and having a look at the research and the case studies that we're building. We have over a hundred and thirteen case studies in three publications of the HEPPP funded projects and the last of these looked at seven years on, and so I just wanted to give you a quick snapshot of some of those specific programs.

So this one here is the You See For Yourself breaking down barriers to higher education for students in year 7 to 10 from financially disadvantaged backgrounds. And I've just chosen... the next one is Bridges to Higher Education and that's a multiple university partnership that's been working in New South Wales and the final one is the children's University in Adelaide allowing young children to aspire to university and to understand what they need to get there.

So I've just shown you a quick snapshot of three but there's over another hundred and ten that you can have a look at, so there is some fabulous work that's happening across our universities. We've also been able to fund a lot of small grants and we have 47 research projects undertaken to place and it was pleasing to see some of that highlighted in the Productivity Commission report.

For instance, Buly Cardak and his colleagues where they were able to look at the study that actually assessed the home address and the residential address of our regional students and there was a need to change some of the way that we were counting our students within our universities because there are actually many more students leaving their regions and coming to the metro area to study.

We also have through the Australian Government six equity fellows that have been funded and there's another six equity fellows to come over the next two years and these people what they have done over the years is worked on a significant piece of work and they've also spent time within the Australian Government Department of Education in Canberra so it is an opportunity to really have the government department working with leaders within research.

And I just wanted to highlight a couple of these all of this is again on our website but for instance Kathy stones research on the support of online students which has resulted in a set of guidelines that's been widely taken up by universities across Australia. Erica Southgate's research on fair connection to professional careers and that actually supports the Productivity Commission's results that equity students are more likely to go into careers such as education and nursing and Louise Pollard's research on our remote students as such a special cohort.

We also have a report about to be released and this is looking at through Maria Rossetti's work how the perceived risks of going to university influenced the decision by people from low SES backgrounds to participate in higher education so people may choose not to attend university based on their assessment of the perceived read risks rather than a lack of aspiration or ability.

And so this research is showing you that students are thinking clearly about their vocational options never got navigating career pathways is often daunting and this is amplified for students from disadvantaged backgrounds and we have another large piece of work that's being done at the moment. Sara O'Shea. And she's looking at mind the gap exploring the postgraduate outcomes and employment mobility of individuals who are first in their family to complete an education degree.

So all of this information is on our website we also are able to highlight the mixed results and you may be interested in having a look at our data program that is an interactive resource as a part of the National Center project to promote public access to data about student equity outcomes and this allows users to come in and compare Australian universities and you will see that there are mixed results there so I've just given you two examples here from West Australian universities.

So my last two points, I could not finish up today without highlighting the regional study hubs, How many people have heard about the regional study hubs? Great! We've just held a conference in Geraldton and we really learned about the tyranny of distance because there are 16 hubs at 23 sites across regional Australia and so we're coming together forming a network and looking at how these not-for-profit groups that have just been funded by the Minister will provide infrastructure such as study spaces, video conferencing, computing facilities and internet access, as well as academic support for students across Australia. And so this is really a wonderful initiative that's going forward and finally the best chance for all.

So in June 2018 the National Center set out to develop a long term strategic vision for student equity in Australian higher education and through a national collaborative process under the banner of student equity 2030. The core outcome of this process is the best chance for all undertaken by our equity fellows Matt Britt and Nadine Zechariah. And again this work is on our website and it's proposed a national policy statement for student equity in Australian tertiary education.

So I'd like to sum up and and thank you for this opportunity to expand on why there is a mixed scorecard and I hope that you've been able to see some of the wonderful ripple effects happening to enable support access and participation to ensure that all people with the desire and capability to attend university have the opportunity to do so and succeed in their studies regardless of their background. Thank you.

Ben Dolman: Thank you Sue for those really quite moving stories of individual opportunity and success at university and also thank you for coming across from Perth today to join us for this session.

Demand-driven funding and the problems of mass higher education

Ben Dolman: Our final speaker is Andrew Norton. Andrew is higher education program director at the Grattan Institute. He's written extensively on higher education issues including publications such as: Taking university teaching seriously, Doubtful debts - the rising cost of student loans and The Cash Nexus - how teaching funds research in Australian universities.

In 2014, he co-authored with Dr David Kemp (the government appointed) he was appointed as the government reviewer of the demand-driven system. He is also an honorary fellow at the Centre for the Study of Higher Education at the University of Melbourne. Andrew.

Andrew Norton: Thanks Ben and thanks also for the great work you've done on this report.

So I've changed my title a little bit. As Michael said, there's a long history of increased enrollments in Australian universities and this is the long run participation rate increase at age 19.

So you can see we've gone from a relatively elite system about 15% participation in the the 1970s to over 40% at age 19 now. I think LSAY is getting a high number but at age 19 we're fairly confident that's about right.

So we have been in an era of mass higher education for a long time, so it raises the question of what kind of mass higher education system is demand driven funding? I think it's one characterised - compared to our typical Block Grant system where the government gives a fairly fixed sum of money to each university - relatively higher levels of institutional autonomy, relatively high levels of student choice and relatively low levels of government direction.

And what I think this produces is a smoother relationship between underlying demand - which is often driven by demography - and university participation.

And you can see in this is lots of bumps in ups and downs in the participation rate and sometimes for example in the late 1970's and early 1980s, the number of student places is still going up but because we have this baby boom moving through the system, the participation rate goes down. In my view with demand driven funding you won't get those same kinks where demography drives participation down. Now Australia is not unique in this, this is a global trend of increasing participation attainment.

This is just have a very short period of time you can see how it's going up. And so what's driving this? Now clearly there are labor market issues going on but I think it's beyond that. There are very deep social and cultural changes which are driving similar trends in different countries despite a very wide variety of funding systems.

You know some of these countries have free education, some have quite expensive, some have loan system, some don't. What's striking is the trends are so similar.

Here in Australia, at least since the early 1990s, well over half of senior secondary students have expressed a preference for university education.

They're going back about 30 years. And we can see that this includes many people who are actually quite uncertain about what they want to do after school. And so increasingly, in my view, higher education, as I said this, is becoming a default option. Not just for those who were clear about what they want to do but for those who are not.

And I think in the upper-middle class at least and in some ethnic communities, you would need a very good reason about why you're not going to go to university even if you don't have concrete ideas about what you want to do next.

I think these preferences over time are morphing into expectations - personal, parental, school, broader social and in my view, it's the pressure this creates in the political system that actually means that whether you've got demand-driven funding or some other system, you will over time see increased participation regardless of the funding system.

And so for me, many of the issues are identified in the report, are general issues of mass higher education. I don't believe we could go back to another low participation system and I don't think it's desirable, I don't think it's politically possible but I do believe at the margins we can do a better job to reduce some of the risk that students are taking and help them get better outcomes.

You've already seen this slide, striking that there's still expected under education as well as over education and I think behind this there's also a bit of there's some unrealistic aspirations around jobs.

So if you look at those same senior secondary school students surveys, about 60% will say that they want a professional managerial job. Look at the more recent cohorts are probably looking at 40-something percent and I've already got this issue with probably 25 to 30% of people who do have a degree are in jobs that wouldn't typically require one.

So as as we've already been said we can do more to advise about careers. Now in all higher education systems, particularly mass ones, there is some balance to be struck between opportunity and risk and the report really highlights this - that the students that we have taken in in the last wave of expansion - while the majority of them are going to complete and a majority will get decent jobs, there are a substantial number who will not do that and therefore they're at higher risk than the other students in the analysis.

Now if you look around the university websites as to their criteria for admitting students, every single one says that the prospects of success are one of the criteria they use or words to that effect. But as far as we could find not a single one states what is a reasonable prospect of success. So it's left completely to the universities or the students in their decision to apply what is an acceptable prospect of success. My view and this is based on work done by my colleague Ittima (at the back) has done - it's in our report on dropping out last year - probably about one in five students, commencing students, is more likely to drop out than to complete.

So we're actually exposing for some students to quite substantial risk. Perhaps at the extreme ends are you probably should not admit them in the first place but in my view people have different appetites for risk and if you're told that you're a 50/50 chance of completing some people would say okay I'll try others would say no that risk is too high for me. So we probably should do more to inform people of the risks they're taking.

If they do decide to take them, we need to advise them about how they can reduce them. In our research, the single biggest risk factor is not low ATAR, it's part-time study and all those who continuously study part-time, less than 30 percent are likely to finish their degree so it's very high risk and it's usually because the people who study part-time have other things going on in their lives that make study hard from a practical point of view.

A lot of them can't do anything about these other requirements but we can see in the enrollment data that many people do shift from part-time to full-time and so sensible advice about that early on could probably improve situations.

Our system already has what I think is globally quite an interesting way of managing risk, even though I don't think it was set up to do this, the effect of it is that it does. And that is that we have through our census date system, effectively particularly a four-week try before you buy system before you become liable to pay your student contribution.

Most other countries will only give you one or two weeks of teaching time before you are liable to pay your fees so that our system basically gives you the chance often to do some assessment work, see whether it's right for you and leave without cost. So I think this is in principle a great system and many people do in fact use it.

However, work we've done at the Grattan Institute shows that there is substantial ignorance around the census date, so some students have never heard of it, some students confuse it with some other important date at the university or others might know it exists but not know when it is. So there are people who sail past the census date, acquire a student debt even though they don't intend to complete the subject.

What we've got here so it's hard to quantify this group but you can see there that substantial numbers of people fail all subjects that they enroll in in their first semester and another non-trivial group goes on and fails everything in second semester as well. Now some of these people are genuinely trying and not succeeding but our view and this is backed up by talking to some universities is that others the reason they're failing is they haven't done any assessment work, they're not there, they've left the university but haven't officially unenrolled and as a result probably substantial numbers are completely, needlessly incurring HELP debt.

So what can we do about this? Well some universities are already quite good on this in the sense that they are keeping track of what students are doing and encouraging them to either get engaged or to leave before they incur a debt. But this could be a mandatory requirement as it already is for the non-university higher education providers.

And we can also do something pretty simple which is this census date, this name goes back decades, it's from the point of view administrators - how many students do we have? Change the name to something like payment date or debt incurrence date and I think that will focus students minds on what this date really means. So it's actually a financially very important date.

So just in summary, to me the case for the demand driven system is not that it's perfect, it clearly isn't, but in its capacity compared to other systems to quickly adapt to underlying needs. But like any mass higher education system this does mean substantial numbers of new students are at higher risk of not getting positive outcomes compared to a more elite system.

And I think this is something we need to work on regardless of whether we stick to the current system of captive government funding or go back to our demand driven system sometime in the future. Thank you.

Ben Dolman: Thanks very much Andrew. So you've heard from all our panelists now about what's happened under the demand driven system, about early childhood and what it means for people's prospects of success, about some of the stories that people that have overcome disadvantage and succeeded at university and also from Andrew about some of the financial issues in particular around mass higher education systems.

Panel discussion

Ben Dolman: We've got time for some questions. We have about twenty minutes, we'll have a roving mic on the floor so if you want identify yourself and also who on the panel you want to direct your question to. Down the front.

Conor King: Hi, I'm Conor King, I come from the Innovative Research University group and just make a couple of contextual comments to go to the Commission.

So first as a group, I argue you have strongly advocated that people ought to be finishing school and then going on to some tertiary qualification whether VET or higher ed with that we need both systems working well.

The bit about the report that is perhaps novel and really welcome is trying to go back to the school link about how well prepared people are for either of those futures and the interesting thing which we put in a comment to the Melbourne declaration last week is NAPLAN gets through to year nine you know an actual skill level there's nothing in year twelve except in New South Wales that actually tells you what those students have achieved.

Everything else, every Year 12 system otherwise normalizes so they force an average force so from year to year you've got no idea whether anyone's better or worse. Indeed what people do know now that were perhaps clearer it might actually have some interesting implications for how people transit on to whatever goes beyond that so that's really welcomed and I think something we need to work through.

Using LSAY is great, we've also tried to use that now own analyses but not try to split between the kind of (who extra) who would have been there. The problem - weakness - which there is as with many analyses that's a very school leaver driven focus so some universities will may only have ten percent of people who are mature age coming in.

My members are more like twenty or thirty on the just doing this from memory and guess, but Charles Darwin's probably well over half, so that's set were there before and may have changed or may not - so that's the only risk about saying this is a pure analysis demand-driven does miss that one group.

Then in terms of some of the things in there the low SES analysis we did using LSAY just on one cohort is that the VET take-up is much higher in the lower SES areas and the sort of inversion there so if actually people worried about people over consuming higher ed there's people in the eastern suburbs or the northern suburbs of Sydney etc but no one advocating a policy yet that I've heard of to constrain their access to higher education but it's the logical answer if you will you're worried about that. I just throw that around occasionally because it gets people a bit provoked.

So the thing is did you or did you not look at - one thing that my group has constantly done in our analyses is look at discipline change and of it's just the whole 100 percent group - so just interested whether it'll cost your difference you pick up that because where the growth happened was in sciences and health and medical health courses.

And this important because the throwaway line from people is there's a lot of lawyers, we don't need extra lawyers and that lawyers have not been the growth area, the funding system didn't did not encourage it - the old one used to and the current one does. So if you don't want lawyers you don't have the current funding system. But I was wondering whether you did look at that point at a guess, I wonder whether the the new set maybe went more for the health courses has been practical and leading somewhere (to just a guess).

Interesting you didn't do gender and the low ATAR people going into university tend to be women and my hypothesis is because they see that it's much more useful for them compared with the young men who either recommend get away with their brawn or just simply don't care. So there was a difference that shows up in most other analyses and whether it showed up anything you did? So they're my two particular points to you.

Michael Brennan: Thanks Conor. So firstly on the point about I was going to say mature aged but really just older aged units it is a point well made and as a point Universities Australia has made this morning particularly in relation to Indigenous students where as we noted in the report a higher proportion of Indigenous students are enrolling at an older age group and the LSAY by its nature wouldn't necessarily pick that up - so that's a limitation. on the two things you mentioned.

On the two things you mentioned, so firstly on gender. Gender is interesting, so my recollection, which Marco can probably correct, is that we found among the additional students that it was more balanced in terms of gender than the other students so the other students were heavily weighted in favor of females as the general university population is but the gender balance of the additional students was closer to 50/50 but I would have to take the precise take the precise ratio on notice.

And on the the disciplines, we did try to have a bit of a look and I might get Ben to expand on this but we did try to take a look at what evidence can we bring to bear on the question of whether or not the demand mix, the course mix is reflecting underlying demand out there in the economy and it'll shock you to know it was a mixed report card.

So there has been a significant rise in health and that's using more the aggregate data than it is looking at the additional students per se. The additional students as I said more likely to study education, more likely to study IT and more likely to study the management/commerce type degrees but it's arguably something better looked at in terms of the aggregate data and the aggregate data reflect there's been a significant rise in health and that does reflect an underlying skill need in the economy but then there are other other areas where it's harder to drive or identify the correlation between what's gone up in terms of study and where the demand might be.

Is there anything Ben that you want to add to that?

Ben Dolman: Nothing from me Michael. Then I was wondering Andrew, whether you've got a perspective on growth in the system and and how it relates to demand in the economy?

Andrew Norton: So clearly health was a major or single largest increase in the demand driven era. There was one which those of you who have followed me over time will realise particularly annoys me which is the growth in science which has turned middling graduate outcomes to terrible graduate outcomes. On the other hand, we've never been able to properly quantifiy this but at least some of these people are gambling that if they do biological sciences they later get into one of the high end health courses. And so you could argue that even though that gamble clearly failed and they're not getting into health, look any kind of good job, it wasn't totally irrational on day one.

I've also seen huge boom in psychology, again, not with very good outcomes. I think this is partly a consequence of what kind of information people are getting about the world. So what we see is that in areas where there are clear skill shortages going on in the economy, somehow this filters through even though there is no organised way of doing it, to the applications data and a demand driven, once the applications move, usually supply does as well, so that's one strength of the demand driven system but you do have I think weaknesses in this information flow and particularly when you've got government out there saying 'Do STEM, do STEM, do STEM' - people pick up this message and do STEM when in fact electing STEM is not a unified field.

They are in fact the S, the T, the E and the M are all quite distinct in in their outcomes and to my mind there has been some very bad advice out there over a long period of time and it's still going on encouraging women to do STEM. The last thing we need is more young women with Biological Sciences degrees, yeah they're already doing very badly.

So we can improve on information, I think the difficulty is in not so much in matching the skill shortages but in picking up where there is oversupply and telling people there is oversupply. I think part of that is the department being much better at letting the enrollment data flow more quickly, at the moment it's all happened a year or 18 months ago before you even know there's a problem and then some kind of more organized way of actually saying across the system we can see that there are way too many students, particularly the vocational fields, are relative to the likely demand for them.

Ben Dolman: Thanks Andrew, we'll take another question from the floor.

Online facilitator: Hi, I've actually got a question from someone who's watching from our live stream - from Jack Goodman - and I think I might direct this one to you Sue.

Given the reports evidence that disadvantaged students who enroll at University are at substantially greater risk of attrition, should the government consider providing more economic support via HECS/HELP to these students and less to students who aren't disadvantaged and then measuring universities regarding the extra support they are delivering to ensure these students succeed at the same rate as their more privileged peers?

Sue Trinidad: Great question, yes, these students definitely need extra support but politically I'm not quite sure what we can do but I do know at the moment there are recommendations coming from the national regional education strategy.

So particularly a lot of these students are from regional areas so there'll be recommendations coming out in the June the 30th report and I would imagine that they will be some policy directions that the minister will look at and take on board but definitely these students do need additional help.

How we actually work that through the system is something that needs to be driven by the minister in the policies through the Australian Government Department of Education.

Ben Dolman: Thanks Sue. Another question here in the room? Yes, Stephen King from the Productivity Commission.

Stephen King: So I want to follow up on that question, how - and for anyone to jump in - the question was how much should the government be doing through things like fee help to assist students who need more assistance to successfully complete to a tertiary education? How much should the onus actually not be the government's responsibility but the institution's responsibility? So to what degree should the universities themselves be accountable for the outcomes for their students?

They are in an excellent position to make judgments about students on the way in, they are in the best position to provide supports on the way through and the success of their students, you would hope, as a metric that the universities care about - so should we actually be moving with the demand driven system to a system that also rewards universities or at least bases some of their funding on the outcomes of their students receive?

Andrew Norton: While having agreed with the Commission on their main report, I don't usually agree with them on the performance funding idea. I think there are a lot of problems here about whether the universities will game this in various ways (and they will) and to what extent they can control some of the outcomes and then a further one to what extent can you measure some of the outcomes because some of these are sample surveys and I think that when the performance funding is announced fairly soon, you know, some of them were rewarded for or penalised for simply within the margin of error on the survey. And so you know is that a kind of sensible policy.

There are some things I think we can do, for example, attrition is one reasonably good indicator. And this is something that the regulator TEQSA which is in this very building, does look at but what they do is they look at all students. And particularly when you've got, you know, the universities mostly other students who would have gone anyway who are doing okay, some pretty terrible results for the additional students can be hidden in that number.

And one of the things we recommended in our dropping out report last year was to actually break down the attrition numbers by the groups we know have a history of vulnerability and so that if a university is doing bad on one of these vulnerable groups, they are in trouble with the regulator. That they either need to show how they're going to improve these numbers or they need to scale back the enrollments of that group.

Ben Dolman: Sue, I wonder if you've got observations on that topic, as well from your work with the HEPPP, about what universities can control in terms of influencing student success.

Sue Trinidad: Definitely. Through scholarships, so I know that the scholarships are use to help equity students that's financial help and support so that's been one way that universities have been looking at helping equity students. Also a lot of the HEPPP funding has gone into mentoring or ambassador type programs which can help students who need that extra support so that that's an opportunity.

Ben Dolman: Thanks Sue. And one more question here in the room.

We need to work on coordination. [laughter]

Tania Broadley: It's like a relay. Tania Broadley - Deputy Pro-Vice-Chancellor (Learning and Teaching) at RMIT University.

I've worked in three universities, in three different states and I think I guess what I'd like to pick up on is Sue's comment about what universities can control and there is a lot we can control, there's also some other things that we can't control and probably hasn't been reflected in the statistical analysis of data.

I guess what Sue did was really important in terms of the narrative around the students and each individual student having the story to bring to the situation but I just want to pick up on the the at-risk students that you showed.

Andrew, through the slide that had failed all units first semester, failed all unit second semester and at universities we have a lot of policies and practices in place that actually supports students to be able to have second chances. I guess and those that come in and treat their studies differently to others. And what the what the data doesn't show are those narratives around students who are making decisions so sometimes the policies and practices that we have in place to actually support those students failing can also be used against us through other students who are playing the system.

So I've got a number of stories I could talk to you about in terms of students who are, you know, on government support for studying and so they don't withdraw because they stay connected to the university. It puts us in a position of how do we manage those students without disadvantaging the students who are truly failing.

So I think there's a lot of complexities behind the data and I'm sure you appreciate that but would you like to comment on other issues that you know about that type of data from a more of a qualitative perspective?

Andrew Norton: I guess our policy recommendations around this is to take account of the complexity of it, yeah for example, it's a requirement that the university try and ensure the student is engaged but it's not actually specifying that you have to bounce them out if they're not and you know that change the name of the census date is that is the students decision whether they want to proceed or not.

And the reason for this is that we kind of like when we started that project, we thought we could do much more at the point of admission in deciding who should be admitted and who can't.

Oh sure, who should not be admitted? I think the growing realisation was that you just can't dot hat, that there is sort of too much information which nobody knows on the day of admission the university can't tell and the student is yet to really experience what university is like. They might do fantastically, they might not but on that day they enroll, they don't know which category they're in and so this has to be a process of trial and error.

This is why I like the sort of the four weeks in thing so much compared to one or two weeks. That four weeks probably is enough to get a sense of whether or not this is for you and basically at the risk of it not working out in this case is really pushed back on the university because you don't get your money if they don't stay past the census date. And that kind of gets your incentives I think more aligned with those of the student.

Ben Dolman: We got time for one more question here in the room.

[Indistinctive voice]

Ben Dolman: Sure.

Conor King: Craig Robertson who heads TAFE Directors Australia for some reason decide to ask this question via me. So he and I'm sure everyone asked his question. Well he wants to know what you, Michael, you think should be done with the VET sector to, in his terms, equalise with the status Higher Ed has?

Michael Brennan: So I think it's still an open question, as to whether equalisation is the right goal. I know the Joyce Review has talked about that there's a potential long-term goal, I think it would be good to gather the evidence. I mean in one sense, the VET fee-help approach was an attempt to get greater neutrality between the associate diploma type level and degree levels and it didn't work well, arguably for other reasons but whether equalisation's the right thing.

I mean I said elsewhere earlier last week that I feel that part of the challenge for the VET system has been the the way that policy has effectively worked in that sector has been to result in a situation where significant changes have been made with very little notice that make a big difference to business models very suddenly.

And that has been problematic, both for the public providers and the private providers and there's been an overall kind of reputational damage partly by virtue of low quality standards in the sector. So I think for VET, I would have thought the real medium-term challenge is to get a well understood, well-functioning market that has rigorously set subsidies agreed for the various courses and provides a degree of stability.

So that a high degree of quality regulation but a degree of stability that the participants in the sector have that degree of certainty about operating there and we get a good high-quality form of contestability between the public and the private providers.

Ben Dolman: Okay so we are coming up against time constraints and just before we finish up I'd like to pose one question to all of the panelists.

My question is: Is there one burning issue that you'd like to see in higher education receive more attention or one change that you'd like to see in terms of higher education policy?

Perhaps starting with you Andrew?

Andrew Norton: Despite the mixed report card that demand-driven funding has been given, my number one policy item is to bring it back.

One of the reasons for that is that we're about to hit the Costello era baby boom, sort of one for Mum, one of the country - lots of one for the country's - and as a result we're going to get a huge increase, particularly in the state of Victoria, in the numbers of students and unless there is some kind of system that both gives the capacity to increase the number of student places and encourage universities do so there'll be a big drop in the participation rate.

Also I believe that its far more flexible in dealing with future labor market issues than sticking with the current system which is really going to freeze 2017 in time and that's not a way to run our education system.

Ben Dolman: Sue?

Sue Trinidad: Mine's is not a burning issue but I just like to and I hope that people acknowledge the power of the HEPPP funded program which has enabled a lot of people to have support and it would be great to see that continued into the future so that equity students, disadvantaged, marginalized students are fully supported to have an opportunity to study.

Ben Dolman: Megan?

Megan O'Connell: I'm interested in seeing if we can broaden our mechanisms for entry to higher education so we have the ATAR at the moment and for good or for evil but it does have significant weight on what happens senior secondary so can we have broader measures that we actually measure success in Year 12 by.

Ben Dolman: Michael you get the final word.

Michael Brennan: So I'd love to say PISA scores at school but it's a big challenge and it's not amenable to immediate policy levers that necessarily bear obvious fruit so I think the more tractable and and perhaps implementable change in the short term would be perhaps in relation to the HEPPP program.

I'm kind of very taken and persuaded by the points that Sue is made about its successes. I'm just not sure that there's been a strong culture of evaluation or indeed transparency about the way the HEPPP money which has been rolled out to universities on the basis of enrollments of low SES students, how well that's really been tracked and how much surety we've got about how well it's delivered outcomes.

Ben Dolman: Thanks Michael. Well that brings us to the end of the session today. It's been a really, for me, a very fascinating discussions and really complex policy issues raised today. I'd like particularly to thank our whole panel and particularly thank our guests - Sue, Megan and Andrew - for coming in and sharing your time and your expertise today and you certainly contributed fantastic perspectives on the range of issues that affect higher education access and outcomes.

So I would ask the audience to join with me in thanking the panel in the usual way. [clapping]

  • Cover, Copyright and publication details, Contents, Acknowledgements and Abbreviations
  • Overview
    • Key points
    • The Commission's approach
    • New opportunities for many, though some 'additional students' fared poorly
    • There was some progress in improving equity
    • Implications for policy
  • Chapter 1 Introduction
    • 1.1 Why this study?
    • 1.2 Setting the scene — the evolution of Australian higher education policy
    • 1.3 What this study does
    • 1.4 Terminology
    • 1.5 Caveats to the findings
  • Chapter 2 Growth in the higher education system
    • 2.1 Evolving admissions processes under the demand driven system
    • 2.2 Who are the additional students?
    • 2.3 How do the additional students perform at university and in the labour market?
    • 2.4 Summing up
  • Chapter 3 Equity of access and outcomes during the demand driven system
    • 3.1 University access
    • 3.2 What explains the remaining gaps in equity group access?
    • 3.3 Academic outcomes
    • 3.4 Labour market transitions
    • 3.5 Summing up
  • Appendix A A snapshot from aggregate data
  • Appendix B Data and methodology
  • References

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