Commonwealth plots uni takeover

  Australian Financial Review     |   16 December 2013

The Commonwealth government is planning to end the historical role of state governments in the establishment and governance of universities.


Uni Syd picEducation minister ­Christopher Pyne is in talks with the NSW government about the Commonwealth assuming control over the governance of the state’s 10 universities, which would be the first stage of a national takeover.

Currently, all universities except the Australian National University were ­established as state institutions, although the Whitlam government took over direct funding in 1974 and the Commonwealth  has had an increasing regulatory role, particularly since the establishment of the Tertiary Education Quality and Standards Agency in 2012.

Under Pyne’s  plan, the “foundation” laws governing each NSW ­university would be taken over by the Commonwealth Parliament and replace state acts.

Pyne regards the division of responsibility as an anachronism, as have most of his predecessors over the past 20 years.  A NSW government spokesman confirmed the state is receptive to the idea if it reduced duplication and red tape for universities, although he described the talks with the Commonwealth government as “preliminary” .

The change would end the NSW ­government’s role as guarantor for ­university debt and the need for universities to seek NSW government approval for borrowing.

University of NSW vice-chancellor Fred Hilmer said he welcomes the Pyne plan because universities spend too much time and money on compliance and  he  would welcome coming under one government.

University of Sydney vice-chancellor Michael Spence said he would like a discussion about the proposal. He said if the move went ahead his university would want to continue its “positive and productive relationship” with the state of NSW regardless of any legislative arrangements.

The Abbott government is also poised to relieve NSW of the burden of $2 billion of unfunded obligations for superannuation schemes operated by NSW universities. The federal government will take responsibility for 80% of the unfunded obligations of the defined-benefit schemes.

Constitutional law expert George Williams said with the co-operation of the states, the Commonwealth could assume full responsibility for universities.

However, if a state government objected, things could prove very ­difficult, he said.

A state government could, for example, de-corporatise its universities, which would take them out of the remit of the federal Parliament altogether, because whatever power the Commonwealth government has over ­universities comes from the Corporations Act.

Williams said there was some precedent, with Queensland ­de-corporatising its local government bodies to prevent then prime minister John Howard imposing industrial relations requirements.

TEQSA loosens grips of states
The Australian 27 April 2011
In employing the constitutional sledgehammer that is the corporations power to establish TEQSA, the commonwealth is poised to crush the residual role of the states in higher education, leaving them as “dead parrots”.
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