Senator Birmingham responded that he is confident the decision will make universities more sustainable in the long term.
“We believe they can absorb such an efficiency dividend without it having any detrimental impact on their bottom lines or teaching or learning,” Senator Birmingham told a conference room of university sector representatives on Monday night.
He is hopeful the federal opposition will support the package but has already started discussions with Senate crossbenchers just in case.
Universities Australia chief executive Belinda Robinson agreed with the Go8, that the run counter to the government’s innovation and skills agenda, which aims to keep highly-skilled jobs in Australia in a competitive global economy.
She pointed out the further cuts come on top of $3.9 billion slashed since 2011, and are in addition to a $3.7 billion proposed cut to university infrastructure funding.
Meanwhile, some students are unimpressed with the prospects of paying more and paying back their fees earlier.
About a dozen students rallied outside the Canberra hotel where the minister made the announcement, chanting “Birmingham go to hell, take your uni cuts there as well”.
National Union of Students president Sophie Johnston said the package was as to be expected — “a war on students and young people”.
“We’re quite concerned about the increase in student contributions,” she told AAP, adding there was no silver lining on university cuts.
Australian Industry Group chief executive Innes Willox told AAP there was a lot in the package to like, especially measures to make students more job-ready and extra engagement between institutions and employers.
Senator Birmingham framed last night’s announcement by pointing to a report by Deloitte Access Economics which showed universities receive enough funding, through government and student fees, to cover the costs of teaching most degrees.
The report shows the average cost of delivery per student grew 9.5 per cent between 2010 and 2015, while funding per student grew by 15 per cent.
Universities received $19,285 per student place in 2016.
Government figures show the average cost of an undergraduate place is $16,000 and for postgraduates $20,000.
The government acknowledges funding in some areas — such as dentistry and veterinary studies — didn’t cover the cost of delivery but says the vast majority of courses could be delivered cheaper than the level of funding provided.
Senator Birmingham says this showed the record level of funding for universities had grown beyond the cost of their operations.
“Universities have a vital role to play in Australia but many mums and dads are feeling the pinch of tighter budgets at home and want to know their tax dollars are being used effectively and efficiently,” he said on Monday. “Universities need to invest taxpayer money judiciously and with appropriate public scrutiny and accountability.”
Opposition leader Bill Shorten said the Turnbull Government should be finding money in the budget by not going ahead with corporate tax cuts rather than making university students pay more to go to university.
Shadow Education Minister Tanya Plibersek also slammed the proposed efficiency measures.
The government should not be “slashing” money from education to repair the budget, Ms Plibersek said.
She also questioned the Deloitte report’s credibility.
“Isn’t it surprising that when the government commissions a company to do a report to justify cuts to university funding and increases to student costs that the report comes out saying we should cut university funding and increase student costs,” she said.
Ms Plibersek also laughed off suggestions Labor had promised similar efficiency measures, saying funding for education had nearly doubled to $14 billion under the Rudd and Gillard governments.
Universities have tried to pre-empt any funding cuts with an analysis the sector says shows it has contributed $3.9 billion to the budget bottom line in recent years. The sector’s peak body says there is no capacity to absorb further cuts.