Professor Alec Cameron

A current initiative of the Commonwealth Government is a Higher Education Base Funding Review.  The intent of this review is to inform university funding levels based on the (relative and absolute) costs of delivering courses in different disciplinary areas, such as medicine, engineering, science, law, business, arts, etc.  This supposes that the cost can be determined for delivering university courses.

We can, of course, measure the costs of what we currently do, notwithstanding that many university costs are fixed, and hence allocation on a per course, or per student, basis will always be contested.  What this reveals is the history of assumptions and compromises that underpin our current models of delivery of higher education.  Decisions around the number of contact hours per course, the number of students per class, and the teaching loads per academic, fundamentally determine the cost of course delivery.

Why is it the case that many business courses typically have three contact hours per week over a 12 week semester, comprising, for example, a two hour lecture each week in a class of up to 400 students, plus a one-hour tutorial with up to 30 students?  The simple answer is that this model is one to which we have evolved over time, driven, primarily, by budgetary considerations.  So the cost of delivering a course, is, quite simply, the funding which is provided.

If more budget was allocated to a course, the likely consequence is that the funding would be applied to more contact hours, smaller class sizes, or other support services, and, in turn, a richer educational experience.  Conversely, reduced funding would likely result in a reduction of student contact and support.

In looking at base funding for universities, the issue is not how much money is currently spent, as this is simply the money allocated, both to the university, and, via internal allocation models, within the university.  The issue is how does this compare with other systems with which we wish to compete.  If universities, or business schools, in North America, Asia or Europe receive higher funding per student for education, then, assuming they apply these funds well, they will be able to provide a better educational program.

The attempt of the government to determine the cost to deliver education by disciplinary area in Australia is a pointless exercise.  All it will do is reveal how funds have been allocated to date.  The more meaningful exercise would be to determine the funding levels of those international competitors with who we wish to compete, and ensure that we are funded at a comparable level.  Then we can ensure that we have the quality universities to which we aspire.

Alec Cameron is the dean of the Australian School of Business at the University of New South Wales.

A version of this opinion piece appeared in the Australian Financial Review Monday 18 July 2011.