HIGHER EDUCATION BASE FUNDING REVIEW: RESPONSE TO ITS REPORT

 COMMENTS BY RICHARD LETTS December 29, 2011 The report has this structure:

• Executive summary
• Enduring principles to underpin base funding
• Recommendations  Then six chapters, each with concluding with a summary and recommendations.
• Chapter 1: The purpose of base funding
• Chapter 2: Strengthening Australian higher education
• Chapter 3: Meeting reasonable costs
• Chapter 4: Supporting quality teaching and learning
• Chapter 5: Sharing the investment
• Chapter 6: Ensuring access and equity
• Then various appendices.

Enduring Principles

By way of orientation, these are the Enduring Principles of most interest to the music sector in facing its current problems:

Principle 1

Base funding is provided for universities to fulfil their fundamental role of providing teaching in an environment informed by scholarship, and maintaining a base research capability, in order to contribute to Australia’s economic and social development.

Principle 2

The total quantum of base funding should support universities in the delivery of globally competitive teaching and learning in appropriately resourced facilities by adequately funding the direct and indirect costs of teaching, scholarship and base capability in research.

Principle 6

While the base funding model should uphold the principle of institutional autonomy, institutions should be accountable for how they allocate the funding.

Principle 7

The base funding model should reflect the relative costs for different disciplines or modes of teaching.

Principle 9

The Government should pursue targeted policy objectives through specific programs outside of base funding where the provision of supplementary funding is linked to transparent performance measures.

Principle 10

Base funding should enable institutions to pursue innovative methods of teaching and learning.

Principle 11

Base funding should be sourced from a balance of student and public contributions broadly consistent with the private and public benefits from higher education.

Principle 12

Base funding should be supplemented through targeted programs to support social inclusion and equity of access for eligible students.

Principle 13

The base funding model should be accompanied by appropriate measures so that student contributions are not a financial barrier to participation in higher education. The review is focused strongly upon university teaching activities rather than research. Base funding is assigned mainly to the support of teaching and ‘scholarship’ with, in the Review’s recommendations, only 6-10% committed to ‘base research’, a very small part of university research activity. Base funding accounts for only about 35% of total university sector income. Recommendation2 states that: The average level of base funding per place should be increased to improve the quality of higher education teaching and to maximise the sector’s potential to contribute to national productivity and economic growth. This is a very narrow view of the purpose of higher education and one which does not fit the music sector’s primary purpose. A more satisfactory view is put forward in section 1.2: The receipt of base funding strengthens universities’ institutional autonomy and academic freedom, thus enabling them to contribute to society on a range of levels. Activities such as leading public debate, enhancing civic and cultural life and pursuing the systematic expansion of knowledge are important outcomes of the provision of base funding. Following are issues of greatest relevance to the music sector as addressed by the Review.

Base funding should meet costs of delivering programs

This is the issue of highest priority for the music schools. Under imminent new Commonwealth arrangements, the number of student places will no longer be capped. In that context, says the Review, it is especially important that base funding matches the base costs: teaching, scholarship and base research. If funding does not match costs, institutions are likely to seek the greatest financial advantage at the cost of an appropriate provision and balance of programs. The report also argues against continuation of the practice of cross-subsidisation for underfunded programs, no longer necessary if base costs are already covered. Further, there are some necessary but special costs, such as education for an increased number of low SES students, that should be funded separately in order to achieve the objectives without distorting base support. The report argues for an increase of funding specifically to raise teaching standards to achieve greater international competitiveness. It seeks to avoid any changes in the division of available funds penalising any discipline and therefore proposes that such changes are met by the overall increase. [This should reduce in-fighting over the division of the pie.] It is concerned that increases in funding are not, as is usual, assigned to research. Among the temptations to assist research is the fact that international rankings of universities are more reflective of their research than their teaching activities.

Creative arts are underfunded

The Review concludes that a number of disciplines are underfunded. The study [of eight universities, commissioned from Deloitte Access Economics], together with additional data from other reports and submitted information, convinced the Panel that there are areas of underfunding in the current base funding model. This report identifies three groups of disciplines of concern:

• accounting, administration, economics and commerce
• medicine, dentistry, agriculture, veterinary science, and visual and performing arts
• law and humanities.

The Panel’s view is that the evidence supports the conclusion that the first two groups are underfunded and require additional funding, while the third group needs careful consideration for additional support (page Roman x). There is a proposal that funding decisions should be made on the basis of modes of teaching rather than grouping of disciplines. This probably would suit music very well. However, the Review concluded that at this time, the exercise would be too costly in time and effort and instead recommended that the government move towards such a basis in the future. This is the actual set of recommendations: The evidence from the commissioned research and submissions to the Panel indicated that some disciplines are underfunded in that they received insufficient base funding to support teaching and learning alone. The additional responsibility for base research capability was therefore unresourced from base funding. Cross-subsidisation from other disciplines should be reduced by increasing the funding for these disciplines.

Recommendation 4: Address areas of underfunding

The Australian Government should address the identified areas of underfunding in the disciplines of accounting, administration, economics, commerce, medicine, veterinary science, agriculture, dentistry, and visual and performing arts, and should consider increasing the funding level for humanities and law.¹

Adjust relativities to better reflect costs

The Panel concluded that some funding cluster amounts no longer reflected the cost of delivering courses. While there will always be debate about what is adequate or appropriate, the evidence confirms that although government investment in participation and access has recently been substantial, there is, on average, an insufficient resource across all disciplines at the individual student level to support the purposes for which base funding is given.

Recommendation 5: Adjust relativities to better reflect costs

The Australian Government should reduce the number of base funding clusters to reflect the convergence of costs of delivery between courses and adjust the relativities accordingly.

Maintain per student funding levels

There is no evidence that any clusters are systematically overfunded. To avoid further increases in student–staff ratios or adverse impacts on quality, the Panel recommends that its proposed changes should be introduced without cuts to any of the current cluster funding rates.

Recommendation 6: Maintain per student funding levels

In modifying the clusters and relativities, no discipline should experience a reduction in per student funding in real terms. The additional funds to the arts would follow from assignment to a higher funding cluster. The Review decided that eight funding clusters, as at present, is too many, and that the number should be reduced to five. From the Review:

Indicative new funding clusters Indicative relativities

‘Indicative relativities’ are the multiples of funding with the lowest cluster as base, to be assigned to each other cluster. The arts would receive 1.6 times the base funding received by law, accounting etc. This is unchanged from the current weighting (see Table 1.1). It appears to the writer from Chart 3.2 (Arts vs Accounting etc or Law or Humanities) that the arts are at present funded at 1.56 times the level of the lowest funding discipline. This reassignment would seem to give us new partners but no additional funding. The Review does state that in making these changes, no discipline should receive less funds that at present. I am not sure whether the intention is that no discipline on the bottom cluster should receive less (as I think is implied in one statement) or no discipline at all, regardless of its placement. In fact, ten disciplines receive lower weightings, and the greatest difference is a fall from to 1.2. So if those particular disciplines were to remain in their new cluster but receive the same funding, and the weightings for the whole system are to survive, funds for all disciplines would have to rise by a factor of 1.6/1.2 = 1.33. So any increase to the creative arts would come not from a new weighting but from an overall increase in base funding by the government. Whether the government will even contemplate a 33% rise in the overall base funding budget must be open to doubt, so strategically, it would be highly advisable that music seeks to move to a cluster with a higher rating. The Review makes this assertion: over the course of the Review, the Panel came to the conclusion that it is base research capability that appears to be the key driver in understanding whether base funding is sufficient to cover the costs of the activities it is intended to support in each discipline or field of education. For this writer, the statement is difficult to understand. The review notes that in disciplines with a high graduate activity in research and low staff teacher ratios, the costs are highest. This seems to suggest that in such circumstances research by students is in a sense counted in the teaching/learning purpose of base funding. But still, the claim is difficult to follow. A number of charts are included to illustrate the findings of the Deloitte study into costs. None seems to support the proposition that costs for the creative arts exceed income. But this, nevertheless, is the conclusion of the Review, perhaps on the basis of ‘additional data from other reports and submitted information’ (above). The Review notes with regret that some disciplines appear to have reduced their offerings to fit the available funding. Music is not mentioned as among them. But we know that it is the case: for instance, we have the statistics from the University of Melbourne showing a halving of contact hours since the Dawkins intervention. The Review thus finds the creative arts, including music, to be underfunded. We might then ask the question: Music is underfunded to achieve what? To offer its present programs, whittled away over many years by progressive underfunding? To offer something like the programs available before the funding cuts – pre-Dawkins, if you will? Or to offer an internationally competitive program? The MCA submission proposed two of these possibilities: funding to overcome the present operational deficit, or funding to achieve international competitiveness, which would be considerably more expensive. So on the face of it, the ‘indicative’ increase will not achieve the following outcomes sought by the Review:

• Enable music schools/departments to meet the costs of delivering their present programs within the base funds provided
• Remove the need for cross-subsidy
• Add to their programs to achieve pre-Dawkins standards or some other indication of minimum program adequacy
• Add to their programs to achieve internationally competitive standards
• Provide support to faculty to undertake research (see below)
• Increase student satisfaction and therefore retention and completions through more contact with faculty members.

One of the problems faced by music through the cluster model is that there is an assumption that base funding will cover delivery costs and delivery costs are the same for all art forms. However, studio instruction in the other art forms is given in classes or in groups whereas in music some of it is given in small groups and some one-to-one. What are the cost relativities? A dance student may have a 90-minute ‘studio’ five days a week, but in a class of 15 or 20 dancers. So far as I know, there is no one-to-one instruction outside of those classes. Indeed, the Review states: There appear to be cases of underfunding for some fields of education but in some cases, this appears to be caused by specific disciplines within an FOE [Field of Education]. Elsewhere, the Review notes submissions about ‘studio-based’ education in some creative arts and states: The disparity in costs for FOE 10 (creative arts) between institutions suggests that it may need to be split between funding clusters with visual and performing arts moved to a funding cluster with a higher rate.(p57) We even have this problem of difference of cost within music: the student/staff ratio is much lower for programs offering individual instruction. As a strategic issue, we could welcome a situation in which funding for all is calculated on the needs of programs offering individual instruction, but if funding is being calculated on the needs of programs that do not offer individual instruction, arguments may need to be advanced about the relativities and that might weaken music’s united front. We note in passing that almost all international comparisons in this Review cite facts and numbers from other English-speaking countries or occasionally the OECD as a whole. This is understandable but for a high level review such as this one, it is less than thorough and rather unenterprising. Certainly, for music, there would be advantage in considering the circumstances in European countries of similar means and culture but contrasting views of the roles of government in culture and education.

Faculty responsibilities

The Review proposes that all base funding should go to teaching except for 6-10% to be assigned to ‘base research’. More about that below. However, teachers each have a responsibility to ‘scholarship’. The Review states that it will make no stipulation about assigning funds to scholarship but that in some employment contracts for academics, there is provision that scholarship will account for 15% of their time. Scholarship is regarded as an aspect of teaching. “Scholarship” is not defined here, but we can assume that it means absorption and analysis of existing knowledge as opposed to the production of new knowledge through research. The review makes no stipulation about faculty responsibilities for administration, community service or research.

Research

The Review notes that most university research is funded under competitive research grants. These grants typically require that the grantee provides for administration of research projects from its own resources. These resources come from a category named ‘unfunded research’, for which the funds come from places other than the competitive grants. ‘Base research’ is part of this category of unfunded research, and as noted is supported from a suggested 6-10% of base funding where in present circumstances, base funding is not totally expended on teaching (costs exceed base funds). The Review is undecided about how to calculate or assign base research funding. It is suggested that funds could be simply distributed to disciplines on the same per student basis as the base teaching funds, or could be directed according to research achievements or objectives decided by the university administration or the individual school. So the prerogatives of a music school in deciding the use of base research funding seem not altogether clear. Nor are the responsibilities of individual faculty members. Presumably, a school could simply decide that base funding would be distributed in full among all faculty members who each would then have a responsibility to spend on research some agreed percentage of their time. Or a school might decide to allocate funds to competing projects involving some of the faculty members and not others. Or the base research funding might be retained by a school to pay for support to any competitive grants won by its faculty members. So it is not clear to the writer what responsibility each faculty member has to produce research and how that is funded. This is one of the concerns articulated in the MCA submission that appears not to have been addressed by the Review: viz. that there is an expectation on faculty members for significant research which is not, in effect, funded because the time they might give to research is taken up by additional teaching as a result of the underfunding of their programs. The submission suggested that the normal expectation is for 20% of time to go to research. However, it was not suggested that the submission include provision for scholarship and it does not.

Student fees

Student fees will continue to be capped. The Review anticipated that if they were not, the institutions would raise them as high as possible and believed that this would not serve the national interest. Fees will be set at 40% of the total base funding level for each of the clusters. Base funding therefore is comprised of contributions of 40% from students and 60% from government. This split is proposed by the Review after protracted discussion of history and alternatives. It probably helps that this is the current split. There will be no consideration of ability to repay student loans depending upon relativities of remuneration to the professions of the graduates. At present students entering a high paying field may be required to pay a higher student fee. The Review took the view that since the actual repayments are not required until an income threshold has been reached, are then a part of taxes paid and proportionate to income (and tax rates?), and may never be fully repaid in some cases of low income, that further accommodation is unnecessary. Where a change of cluster funding would increase the student fee, it is recommended that the change in fee should be phased in in small steps. Where the fee would otherwise decrease, it is recommended that it should be held constant in nominal terms, and that over time as base funding increases with inflation, achieve its new real dollar level. Existing students would be grandfathered in with no fee changes.

‘Performance’ funding

This is not about musical performances but rather, quality teaching outcomes. The Review recommends that quality and innovation should be rewarded but through financial measures additional to base funding. Base funding should not be conditional; withholding base funding from underperforming programs would handicap their ability to improve. A case is made for retention and completion rates as indicators of quality teaching. There is no specific proposal for how or by how much these outcomes should be rewarded. The one clear financial proposal in this area is through the creation of flagship courses.

Funding for ‘flagship’ courses

From the Review: Flagship courses could be provided at the undergraduate or postgraduate level and could, for example, include research-intensive undergraduate programs designed for high-achieving school leavers; courses involving a prestigious international experience; or clinically based forms of work-integrated learning (WIL) with especially low student–staff ratios. Providing institutions with the opportunity to develop flagship courses funded at up to 150 per cent of the regular rate is a significant departure from current arrangements. The Government would need to monitor and review this initiative closely for its effectiveness from its inception to safeguard the public interest. Given the high level of investment required, the Panel considered requiring approval for these courses, but felt that this was contrary to the view that universities should have autonomy in the use of base funding. However, the Government should work with the sector to develop the criteria and guidelines for this program.

Recommendation 13: Funding for flagship programs

The Australian Government should encourage institutions to develop outstanding programs that would be funded up to 50 per cent more than the standard base funding rate, by both government and student contributions according to the 40:60 ratio, to a limit of 5 per cent of each institution’s total Commonwealth supported load. Recommendation 14: Ongoing evaluation of flagships In cooperation with the higher education sector, the Australian Government should evaluate institutions’ flagship programs on a continuing basis to monitor their effectiveness in encouraging excellence and innovation as well as their impact on student participation and achievement. Note that student fees for participation in the programs would be up to 50% higher than normal. There are abundant possibilities for music departments and schools to design and propose flagship programs, justified on merit. Also, there is the possibility of using outstanding program outcomes to enhance a school’s value to a university and so strengthen its position and the support it can achieve.

Postgraduate programs should be funded at same level as undergraduate programs

This recommendation accords with the views expressed in both the MCA and NACTMUS submissions. Indeed, NACTMUS is quoted (p64). The Review did not find clear evidence of differences in costs and in any case believed that if postgraduate programs received higher funding, institutions would distort programs in its pursuit. It should be noted, however, that the Deloitte study found major differences in costs in some disciplines including the creative arts, where postgraduate courses cost around 40% more than undergraduate courses.

Work-integrated learning (WIL)

For music, the relevance appears to be mainly in the teacher practicums for specialist school music teachers. Institutions are complaining that there are extra costs that are not met from funding. For some industries, there is a prospect that corporations will assist, especially in situations where their funding support is applied to tailor-made courses to produce graduates to their specifications. The Review apparently regards the financial evidence of underfunding with scepticism and recommends additional funding of $1,000 a year per student. Could there be a possibility of government supported WIL for music performers, e.g. in organised experience with professional orchestras or opera companies?

Infrastructure

The Review addresses the need for infrastructure, notes the daunting backlog and the major changes in the ways that space is used. It is agreed that a portion of base funding is spent on infrastructure. It is noted also that there have been and are special funds to assist with capital expenditures but noted that these are drying up.

Developing contemporary learning spaces

The Review makes one specific proposal for new expenditure on infrastructure, in a proposal that the emphasis should be on refurbishment of existing facilities to create ‘contemporary learning spaces’ suited to new modes of teaching and learning. For this purpose, it proposes that the government should provide an additional annual amount equal to 2% of base funding. We support this proposal with the only reservation being about its adequacy. While the Review acknowledges the increasing use and cost of ICT, curiously it makes no recommendation about how it is to be supported other than implicitly through base funding or funding as an element of the new learning spaces.

Seeding fund to assist in the pursuit of philanthropic support

This would support schools and departments in establishing effective programs to pursue philanthropic support. Music has some natural advantages in attracting such support and initial funding to set up professionally directed programs could produce very good results.

Admission of low SES students

The government has set ambitious targets for an increase in the number of low SES students in university study. Universities warn that the cost of teaching low SES students is high because of the need for remedial education and other such measures. The Review finds that poor success in university does not correlate with low SES but with low Australian Tertiary Admissions Ranking (ATAR). Remedial work is advised with students with low ATAR, but an alternative is for tertiary institutions to form partnerships at the secondary school level and so attempt to remedy problems before students sit for final exams. It is perhaps a little far-fetched, but in music, intervention might come better at primary school level, were that practicable, because that is where the problems begin – especially in low SES areas where the provision of music education depends entirely on the educational authorities. The Review recommends a special payment of $1,000 per low SES students where used to fund special support measures. There are other measures to support education of those with special needs, which we support.

A PROPOSAL FOR AN ACCREDITATION PROGRAM

The report refers a number of times to external accreditation requirements in various industries and their influence on tertiary course requirements and standards (see, for instance, pages 65, 70, 88.) Example: ‘Industry bodies can set accreditation standards for a range of degrees and as a result of these standards, the requirements and components of courses are changed. For example, eligibility to practise as an architect requires a postgraduate qualification and hours of clinical supervision are prescribed in clinical psychology courses.’ (Page 101) There are no such industry standards in tertiary music in Australia, although there are elsewhere. In the USA, nearly 600 tertiary music schools are accredited by the National Association of Schools of Music, and accreditation is taken very seriously. The Association of European Conservatoires for some years has been developing accreditation standards under the Bologna Declaration Process. It is not difficult to argue against such an accreditation process for Australian tertiary music institutions. The prospect of more bureaucratisation or accountability is unappealing. However, in responding to the Base Funding Review, we had considerable difficulty in stating clearly what it is that should be funded.2 For instance, what is the appropriate duration of individual instruction per week in a conservatorium course? The answer on the ground in Australia is very much influenced, institution by institution, by what can be paid for. We were able to refer to an NASM statement that each student should receive at least one hour per week of individual instruction and to cite (enviously) the longer or multiple lessons in a rather random selection of European conservatoires, but we had no agreed Australian standard. ² The Base Funding Review addresses little detail of any discipline, as might be expected. The proposal for increased base funding to the creative arts is supported by reference to the high cost of studio teaching but the only explicit reference is to visual arts teaching which is delivered, as we understand it, to smallish groups. The only chart in the study showing student numbers per teacher has as the smallest number, 9 students. On the face of it, one-to-one teaching has not been considered. The Deloitte study commissioned by the Review examined the operation of eight universities but nowhere are they identified. We do not know whether they included representation of the higher cost music schools in which individual lessons are indispensable. As noted, there is a proposed increase in funding to the creative arts but the actual assignment to a funding cluster is such that the increase might be virtually indiscernible. It is not proposed that music should follow the architecture model and impose a further accreditation requirement on graduates. In music, that would be futile in any case. Musicians are hired because they can perform, not because they hold a qualification. (However, the Music Council, on the recommendation of its 2010 Classical Music Summit, is proposing industry accreditation of studio music teachers. But that is a separate issue.) Rather, it is proposed that the teaching institutions should be accredited. Why? Here is a line of argument.

• The sector would develop a well argued and supported set of standards.
• This set of standards could be developed with reference to international best practice.
  • The Commonwealth refers repeatedly to the need to be competitive internationally.
• To achieve the standards requires provision of the means.
  • This financial provision is in the hands of the government and the sector would have an authoritative basis for arguing to the government for adequate support.
  • The provision is also in the hands of individual universities, and so each music school or department would have an authoritative basis for argument to its university. It can also draw comparisons between the provision to its own program vs the provision to programs in other institutions, with reference to the standards.
• The standards would also be useful to institutions in reflecting on their own programs, asserting strengths, considering weaknesses.

There is an increasing programmatic differentiation among tertiary music institutions in Australia. This is desirable and welcome but it makes the task of defining standards more complex. They should somehow be framed in accordance with the purpose of each category of program. (What are the categories?) This may well require some pioneering work, but that makes the project even more interesting. One issue for consideration is how this ‘industry’ accreditation can best be used to influence action in the tertiary sector. What would be the effect of withholding accreditation from a university music school? How could that influence university decisions to give financial support to remedial action? It might be anticipated that tertiary music institutions falling outside the university sector would be very interested in achieving accreditation. It may be also that the system could extend to award- granting TAFE programs. In addition to accrediting music institutions, in some instances there would also be an argument for accrediting courses. At present, the decisions about what mandatory music education is required in university courses for primary school generalist teachers is taken by the Education Departments in each relevant university. In most cases, this has resulted in courses that are highly inadequate, with serious consequences for the entire sector. To this point, there has been no pressure for improvement. The accreditation system could withhold its endorsement of such courses and make this known. How to proceed? Development of the statement of standards

• This would require the services of a group of experts.
• They would probably need the assistance of a researcher, who might need funding
• This could be an unaffiliated ad hoc working group but probably, preferably, would work under the auspices of an organisation
• The logical choice of organisation is NACTMUS, should it be wiling.

Application of the standards

• The statement of standards could be published and then adopted by choice of any individual institution
  • This could have value as a point of reference in advocacy
  • However, if the music institutions cannot demonstrate that they will themselves meet the standards, the power of the argument is much diminished
  • How would they give serious demonstration of this commitment?
• The statement of standards could be the basis of an organised accreditation procedure
  • We can draw on overseas experience
  • Who would administer this procedure?
  • In theory it might be government but that seems undesirable and probably it would not be interested. It is more appropriate that it is administered by the ‘industry’
  • The logical choice is NACTMUS
    • There is some problem in that case, inasmuch as NACTMUS has to make assessments of its own members and there is a conflict of interest
    • Can unaccredited institutions be members of NACTMUS?
    • How do other industry bodies manage such conflict?
  • Alternative organisations or structures are not readily apparent
  • The procedure would require funding. Presumably, this could come from fees paid by the institution being accredited.
  • In the USA, institutions are reminded of standards and the program is sustained financially by a requirement for periodic review of accreditation.

Author

Richard Letts