Managing Cultural Difference in defence of the public interest:
Universities and Business – a new partnership?

Carolyn Allport
National Tertiary Education Union

Paper prepared for conference “The Higher Education
Enterprise: Partners, Profits and Politics”, National Education
Association, Higher Education Conference
San Diego March 2-4, 2001

As the service economy and service industries have become more important
to the economic health of first world countries, education and higher education
in particular, have come under the gaze of business leaders as well as policy
makers. In Australia, this gaze intensified as the international student market
expanded, and higher education institutions vied with wheat producers as key
export industries in a new global economy. Constituting universities as key
economic agents, at the same time as growth in tertiary participation has
placed pressure on public funding, has brought cultural changes to our
universities – and not necessarily all for the good.

When university leaders speak of the need to modernise and globalise
universities, they mean recreating the university as a business. When industry
leaders speak of the need for universities and industry to co-operate in
research, it can often mean restricting research to the immediate needs of the
firm. It is not surprising that there have been cultural clashes within
universities where such developments are seen to threaten the identity of
universities as sites of independent and critical inquiry. Recently, the most
public of these clashes has been here, on the west coast of the US, at the
University of California. The issue – the deal with Novartis. Reviewing these
developments, the prestigious international journal Nature, in its January issue
of this year asked “Is the university-industrial complex out of control?

Some of the territory on which we fight is political, in the sense that university
managements are remaking our institutions to operate as businesses with
little concern for the public interest. In other areas cultural change is occurring
which has seen academics and business researchers working to enhance
both public interest, and provide opportunities for private sector profitability in
the long run. Certainly it is important to contest the broad thrust of
corporatisation in higher education, but it should be done not just from self-
interest. Rather our strategy must be to engage politically, speaking for the
public interest and public accountability.

Universities in Australia have seen similar falls in public investment to that
experienced in Canada. As we strive to lift participation rates in recognition
that at least 4 out of 10 new jobs will require a degree, more and more of the
costs for higher education are being borne by the student. (See Appendix 1)
Unlike the system in the US, Australian universities find it extremely difficult to
generate substantial external income. An historically strong public system and
a small population mean that there is little demand for fee-paying
undergraduate places, and we don’t have the industry or philanthropic base to
generate large sums of external funding. For over a decade Australian
students have paid fees through the HECS scheme – an income contingent
loan for fees that has no market rate of interest, where students repay through
the tax system once their income has reached around 55% of average weekly
earnings. Differential fees are charged depending upon the type of course. At
the postgraduate level, and for overseas students however, fees are charged
without the benefit of a HECS scheme, and at higher rates than


undergraduate fees. (See Appendix 2.) In an environment where HECS
covers around 82% of students, there are limits on the degree to which fee
increases can replace falling government investment. The funding squeeze
has been amplified over the last six years with the failure of government to
provide substantive financial support for collective bargaining salary
increases, leaving some institutions financially vulnerable. The degree to
which increases in costs have outstripped increases in revenue is
demonstrated by the sharp decline in the Safety Margin – the surplus relative
to income. In 1995 it stood at 6.9%. It has fallen in 3 of the 4 years since to a
low of 3.3% in 1999. (See Appendix 3.) The current shortfall is near $A150m
every year.

The financial crisis is being borne not just by our students, through fee
increases, but also by staff. The student/staff ratio continues to increase
(from 14.8 in 1995 to 18.3 in 1999) while staff employment has fallen by 3%.
Working hours are rising (near 90% of academic staff work above 40 hours a
week, with 40% working more than 50 hours a week). Job satisfaction is
falling to near 50%, while over 80% of academics reported that their jobs had
become more stressful since 1996. Institutions are spending proportionately
less on salaries, now at a historic low of 59% of income and more on activities
such as advertising and marketing to earn valuable non-government income.

Debate about higher education in Australia today is characterised by two
polarised positions – whether to restore and increase public investment, or
allow a wholesale deregulation of our higher education system in the name of
generating external income. Whether some middle ground can be found
remains to be seen. Government remains committed to further deregulating
the student fee market, proportionally reducing Government investment, and
encouraging increased industry investment and influence in research. Our
Government is also a strong supporter of the GATS, and for opening up
Australia to foreign investors in the higher education sector. Such policies go
hand in hand with a voucher scheme – student portability avoids those
“difficulties” that come with balancing government subsidies across a global
world. The fact that we have not yet gone down the voucher path is only due
to the fact that such plans are politically un–saleable and there are active staff
and student campaigns in opposition.

Public campaigning by staff and students has tapped a broader concern
among communities, as well as opposition political parties. This concern is
driven by a realisation that education, and increasingly higher education, is
critical in building a nation’s comparative advantage in knowledge, and
therefore access to new global markets – both in people and in products.
Governments also see sustaining development in new knowledge industries
as central in overcoming regional disparities within our country, and the
politics of exclusion that drives a rising right-wing politics. There are,
therefore, strong public interest arguments for increasing investment, as
community dissatisfaction with globalisation continues to build. A high public
interest function for governments sits uneasily with a corporate view that sees
the spread of new communication and information technologies as providing
opportunities for education to be the newest for-profit growth industry.


These issues have created pressure points in teaching, learning and research
where public interest and private benefit intersect. It is at those points where
the argument for the public interest must be put, and put powerfully since
public support for higher education rests on our institutions being
independent, offering high quality courses sustained by academic standards,
and undertaking research with a high degree of public interest, without fear or
favour. Key sites of tension are governance structures, intellectual freedom in
research, employment relationships, intellectual property rights and academic

The stakes are high - as representative organisations we must develop
engaged and positive responses that place our organisations at the centre in
contesting the public benefits and costs of the growing corporatism in
education. Such strategies must be both local and global, and they should
include public campaigning, industrial and organising strategies, and isolation
of best practice models for universities and colleges to build partnerships with
communities, including business. In this way our organisations will be best
placed both to defend local issues and engage with the new global cartels.

In this section I want to talk about a number of specific examples from
Australia that illuminate these tensions, and speak with you about the
strategies we have developed to raise the central issues of public benefit and
public accountability.
The issues chosen are not exclusive to Australia, and will no doubt have some
resonance with your own experiences. These are:

     Teaching and Learning as business

     Taking governance out of the academy

     Seeking global partnerships with for-profit corporations

     The Co-operative Research Centre Program – a new model for
      collaborative research between industry and the academy


Teaching and Learning as Business – the issue of standards
For the first two months of this year, there has been a sustained public debate
in Australia about emerging problems of ensuring independence and quality of
assessment in our universities. The pressure on assessment standards for
fee-paying students in Australia is not a new issue. There have been a
number of reported cases where staff have not had their contracts renewed,
or not been given support for promotion, once they have “blown the whistle”
on supervisors who have suggested adjusting pass levels in fee-paying areas.
Perhaps more importantly, the introduction of devolved budgeting down to
department level has meant that academic units are expected to “earn
income” to cover all departmental expenditure, including their own salaries.
Fear of retribution then blends with concern to maintain job security.
Academic staff employed in continuing positions can still be made redundant
in Australian institutions, albeit by a complicated process of accountability
encoded in the collective bargaining agreements.

A leaked report from an academic survey “broke” in the quiet summer holiday
time of January, and the story continues to reverberate in the press. Some of
the flavour of the debate is illustrated by the newspaper headlines – often on
the front page, or editorial page.

Newspaper headlines – the standards debate 2001

     Student offered $2m to uni for marks upgrade

     University lectured over inaction on money-for-marks affair

     Universities cannot afford a cover-up

     Unis reject claims of bribe-taking

     Accountants want uni exam inquiry

     Uni cheat to get a degree

     Sackings call over uni exam upgrade

     Why academic freedom is on the line

     A watchdog needed for ivory towers

     We need an inquiry into uni rorts claims

The high media profile of our organisation enabled us to engage quickly with
the issue and collect evidence of particular practices from our members via
email. Members spoke of differential treatment for fee-paying students,
adjustment to normal pass rates, and strong pressure on staff to redistribute


scarce resources towards fee payers in an attempt to maintain enrolments.
Overseas student enrolments, the vast majority of which are fee-paying, are
projected to total 117,000 in 2003, up 200% since 1995. Revenue from
overseas student fees has also increased – up by 50% since 1996, and now
representing about 9% of all sectoral revenue. Time and again staff were
being asked to cut corners or turn a blind eye in order to generate this income,
income needed to keep their course or department running. Market forces
were driving a lowering of academic standards, and for most of the debate the
institutions were denying that such practices existed.

After the story had been running for some two months, the Australian Vice-
Chancellors’ Committee finally admitted that there was a need for their
organisation to conduct a survey of all institutions and review their codes of

The standards debate attracted considerable community interest with media
shows, interviews, editorials and letters in all major papers. Our agenda was
to shape the debate, shifting the focus from individual academics to the
broader issues of commercialisation, institutional pressures arising from falling
public funding, and the reluctance of institutions to support “whistleblowers”. In
the context of a federal election year, with university funding beginning to
resonate in party polling, debate was also critical of simplistic notions that
students are consumers, and higher education is simply about private benefit.
Community voices demanded that action be taken. Professional bodies, such
as the Institute of Chartered Accountants, weighed into the argument, and
called for an inquiry. The public had a right to expect Government to ensure
full confidence in the academic activities and standards of its public
universities. Yet the new quality agency is specifically debarred in its
constitution from investigating individual complaints about an institution. As it
is, concerns will need to go to a national Senate Inquiry into Higher Education
that begins taking evidence this month, and NTEU is encouraging members to
appear and speak clearly and openly about the ways in which commercial
considerations are compromising academic standards.

Such community debates are important because they enable community
concerns, in this case about standards, to be linked with government funding
policies, and are helpful in building up a “wall of noise” as a prelude to the
election later this year. At the heart of this debate was the public interest
question, and ultimately staff were seen to be the ones speaking for that
interest, while institutional leaders lacked public credibility.

Taking governance out of the academy
From the early 1990s, universities began to create “associated entities”
outside of traditional governance structures. In the main these were wholly
owned subsidiaries of the university, and the first area where universities were
active was in establishing companies to link with industry in the new research
and development parks, or to commercialise university research from


invention through innovation to product launch. Increasingly, such companies
have also been used to collect non-government income, usually student fees
and consultancy payments. While these companies report to the university,
and their financial statements are part of the consolidated income and
expenditure of the institution, university governing bodies do not pay
significant attention to their activities.

One high-level research institution, the University of Melbourne, actually
moved to recreate itself entirely as a company, establishing a “mirror image”
of itself in a fully incorporated entity, Melbourne University Private. University
management undertook this venture in part to escape not just the broad
regulatory environment, with its prescribed public accountability, but also the
industrial framework of collective bargaining. The governing board of
Melbourne University Private comprises key management officials from the
public university and business leaders. It has none of the broader governance
structures of the public university, and there is no representation from staff or
students. It draws its staff resources from the existing public university,
utilising the intellectual property developed with public money. In effect, the
long-term aim was to make the public university the “shell” company, with all
activities taking place in the private for profit venture. In reality, this has
proved harder to establish than originally envisaged, concentrating largely on
the provision of postgraduate short courses tailored for clients – such as an
Ethics course for defence personnel. In the last month the Vice-Chancellor
has admitted that Melbourne University Private would not be commercially
successful, although “it seemed like a good idea at the time”.

The decision to form such companies is based on shifting elements of
university operations away from any regulatory framework, be it collegial
governance structures or government regulations. Existing public universities
have been rebuked by state government auditors, to whom they owe a duty of
financial disclosure, for failing to adequately specify the operations of any fully
owned companies. NTEU has encouraged State Governments, as the
regulatory authority, to argue for greater transparency and accountability in
the presentation of universities’ financial accounts in the public interest. This
too has been the subject of media interest – inviting letters and editorials.

Important issues remain unresolved, most particularly whether decision-
making bodies of the public university have any real say in the decisions and
operations of the corporate arm, and the difficulties arising from lack of
transparency in financial reporting. University budgets and other financial
documents, prepared as part of accountability provisions, vary from year to
year, with little consistency in the detail provided about controlled entities.
NTEU, along with other community voices, questioned whether the public
university, and public funding, was underwriting the risk-taking activities of
corporate arms with little public accountability.

Company structures not only raise the broader issue of public interest, but
also of conflicts of interest between individuals involved in both the public
university and the associated company. This was brought into sharp relief with
the sale in late 1999 of a company called Melbourne IT, itself a subsidiary of


Melbourne Enterprises International, a wholly owned company of the public
university, The University of Melbourne.

Melbourne IT’s core business was the supply of domain names. This business
originated from a licence held by a computer systems administrator employed
by the University, but working in a voluntary capacity to register domain
names. As business expanded, the employee delegated his licence, on a non-
exclusive basis to Melbourne IT. The company developed new software that
allowed registrations to be done quickly, becoming one of five successful firms
in the world able to issue global domain names under authority from the
International Corporation for Assigned Named and Numbers (ICANN). When
the decision was taken by Melbourne IT to recommend publicly floating the
company on the stock exchange, only $5m was stated as being necessary for
the company to sustain its new international business.

Public debate about the future of Melbourne IT was confined to the
management boards of Melbourne IT and its parent company, Melbourne
Enterprises International (MEI). The process for developing the public float,
determining the initial share price, the number of shares that would be held
back by the parent company, as well as the process to ensure due diligence
were all undertaken “at arms length” from the University of Melbourne, the
organisation that had originally given support to the initiative of the staff
member as a public university.

The University itself benefited less than the big end of town. The float was
marketed to the public as essential to raise money for the public university.
Instead the profits from the float were allocated as working capital to the
parent company and as seed money for a new Bio-tech consortium.
Interestingly a number of individuals associated with the university and its
companies received shares in the float. This included members of the
University Council, Directors and employees of the University and MEI, as
well as employees of Melbourne IT and individuals associated with the Bio-
tech consortium. Not one person on the University Council, who benefited
from the float, indicated a potential conflict of interest. These were the people
charged with approving the float and protecting the interests of the public

Little here for the on-going teaching and research of the public university,
apart from a promise that interest received on the working capital given to MEI
would be spent on staff salary increases. It is no wonder that faculty are
cynical about the extent to which the public university can bank on returns
from the corporatisation of different aspects of university activity, especially as
there is little information provided in any of the University’s public documents
about the nature of the transactions between the public entity and its
commercial operations. The float has been formally investigated by the
Victorian Auditor General, as part of accountability provisions under the
University of Melbourne Act, and found to be wanting in several important
ways. In particular, the report raised questions about the lack of protection of
the investment of the public university, the failure of the University to seek
guidance from the Department of Treasury and Finance and seek an


independent valuation of its asset, and the dissonance between acceptable
corporate behaviour and the accountability standards expected of a public

NTEU initiated its own investigations on the float quite soon after the share
price rose from the initial float price of $2.20 to a peak of $17.00. In fact, the
float recorded the second largest first day percentage gain ever recorded on
the Australian Stock Exchange. This led the Union to believe that the interests
of the public university, the owner of the venture, had been overshadowed by
the gains made by corporate players. Beginning with a number of members
meetings, our strategy moved to issuing Freedom of Information requests for
the taped recording of the Council meeting where the decision to float was
taken, perusing share registers to ascertain who benefited; and finally raising
our concerns with the Australian Securities and Investment Commission in
order to clarify whether any impropriety had taken place. We have requested
that an investigation take place in the public interest.

Such commercial ventures are a matter of public interest for two reasons:

     The public has an interest because of the investment of over $300m in
      Federal funds each year in the public university.

     The public community of staff and students has a direct interest in open
      and transparent decision-making by the University’s governing bodies.
      Such an interest had been compromised by the events surrounding the
      float, and possible conflicts of interest arising from the process.

Insistence by the University of Melbourne that all of its Council meetings were,
in fact, secret, led the Tribunal hearing the FOI request to ask whether the
public university was a “secret society”. The Tribunal is still to comment on the
public interest questions, and we are awaiting a decision.

Seeking global partnerships with for-profit corporations
Higher education has long been internationalised – faculty links across the
globe, often on a discipline basis, have nurtured intellectual work, fostered the
broad public interest in research and sponsored staff and student exchanges.
More recently institutions have joined together to offer students across the
world an opportunity to study on-line, choosing courses from among the many
offered by a variety of consortia. Partnerships are formed with private IT
companies to provide the necessary platform to deliver courses to students.
From this perspective, such developments may have many positive
advantages. However not all such partnerships are in the public interest –
rather the motive for some ventures seems to be to maximise profits, for both
the universities involved and the private companies.

One such venture capturing the attention of our organisations has been
Universitas 21 (U21), a consortium of 18 universities which sought
partnerships with News Limited and Microsoft, and are currently finalising a


deal with North American media giant Thomson Corporation. The universities
involved in the venture include:

McGill University
University of British Columbia
University of Toronto
University of Michigan

National University of Singapore
University of Hong Kong
University of Peking
Fudan University

University of Birmingham
University of Edinburgh
University of Glasgow
University of Nottingham
Albert Ludwigs University Freiburg

University of Melbourne
University of New South Wales
University of Queensland
University of Auckland

Three additional US universities were invited to a recent meeting, and may
also join U21 – New York University, Georgia Tech University and the
University of Virginia.

The U21 venture raises important issues about the new models of global
delivery, and brings into focus the sharp end of the corporatisation of higher
education. Under the proposed deal Thomson Corporation will be responsible
for course design, content development, testing and assessment and student
database management and translation. The universities will licence their
“brand names”, receiving money for allowing the crests of their institutions to
be used by the new international institution. The universities are not selling
their courses; rather it is their reputation that seems up for sale. As part of
establishing U21, “brand name” valuations were commissioned to measure
the universities’ respective contribution to any joint venture, and university
leaders at one prominent U21 site speak about their work as “brand equity
A Thomson spokesperson stated that U21’s structure “enabled it to take a
powerful international brand, credible quality assurance and multi-jurisdictional
certification, and add Thomson Learning’s expansive content and course
development experience”. It predicts a market of 97m students by 2010.
Thomson has been shifting its resources from its newspaper holdings to
education, purchasing recently Prometric, an IT assessment company for
$US4.2b, Petersons, a student admissions company for $US2b, and acquiring
the higher education area of Harcourt Publishing for another $US2b.


Initially little information was available – most of what we knew came through
the mass media, or via press release. There was little discussion at the
participating institutions – conversations about such an important venture
seemed to be taking place only in the inner sanctum of university Presidents.

The Vice-Chancellor at the University of Melbourne took the lead in this
consortium, and it is this university that has underwritten the costs of
negotiating the deal. Having already experienced the corporate dreams of this
Vice-Chancellor, it was not surprising that it was our own organisation, along
with student groups, that first began to express concern as to the nature of
this venture. Along with our colleagues from our sister organisation in New
Zealand, we began to investigate the nature of this new global venture.
Together we formed email networks with other staff and student organisations
in many of the U21 institutions, finally having a strategy discussion at our
recent international meeting in Europe. At this early stage, staff and students
were extremely concerned at the failure of the university to discuss the
proposed venture openly at the governing board, and more broadly with staff
and students. Using staff and student representatives on such boards, we
developed a common set of questions to assist network participants to
question their own institutions in the public interest. The relative dearth of
information suggests that university governance structures are seen as an
impediment to the kind of commercial venture envisaged by the U21/Thomson

In an environment where we are seeing a shift in universities’ assets from the
public institution into commercial ventures, the questions being asked go to
corporate and financial arrangements including methods for staff
appointments and under which jurisdiction those employment arrangements
are made. Financial due diligence is an important feature of the transfer from
public to private identity, and full disclosure under such processes is essential.
Staff and student representatives on governing boards are also being asked
to raise issues associated with academic due diligence and governance. In
particular how are quality assurance and accreditation to operate in the
consortium, and how are the activities of the consortium to be reported back
to the governing boards of the public institutions? These questions then
became the basis of a joint letter to the U21 Secretariat from faculty unions
from Australia, New Zealand, UK, Europe and North America. Our letter was
written from the perspective of public responsibility – as university unions and
staff associations we held it to be important to protect the interests of our
members and defend the integrity and reputation of our institutions, and the
educational programs offered through partnership arrangements with other

Utilising the UNESCO Recommendation on the Status of Higher Education
Teaching Personnel, signed by our national governments, the signatories of
the letter drew attention to the key issues of accountability of universities,
duties and responsibility of teaching personnel, intellectual property, quality
assurance, academic freedom, governance, representation and employment
protection established under the normative instrument. We also informed U21


that we would forward to the consortium a log of claims in respect of the
Thomson Learning arrangement, and Universitas21 activities more generally.

We now have quite a clear picture of the way U21 is to operate. Like
Melbourne University Private, the venture uses a complicated companies
structure to insulate the various activities of U21. (See Appendix 4)

The key operating company will be U21 Global – jointly owned by U21
(through U21 Equity) and Thomson. It will appoint staff and operate the
business. Academics are to be renamed as course developers, instructors
and assessors and will be contracted by U21 Global through a tender
process. U21 will be registered in Singapore where activities of trade unions
are highly circumscribed.

Profits will be shared according to capital raised, although it has been
reported that Thomson would contribute more capital than the U21
participating institutions, at least initially. Control will be vested in a board – 3
U21 Presidents, 3 Thomson Learning, the CEO of U21 Global and an
independent chair. Another associated company U21 Pedagogica, owned by
U21 institutions, will manage quality assurance. As a separate company,
Pedagogica may also do business with other institutions, particularly in
benchmarking. Courses on offer in the early stages are postgraduate
programs in e-commerce, business administration and information systems.

Little is known of the way intellectual property will be protected, nor can we be
guaranteed that information as to the activities of U21 Global will be reported
back to the university communities that are subsidising this for-profit venture.

The participating institutions derive money from the sale of their brand name
and any profits that accrue as an equity partner, while faculty will experience
an unbundling of their work – separating course design and curriculum
development from the learning and assessment processes creates
educational difficulties, as well as encouraging increases in contingent labour,
and there are no guarantees that those employed will be from the participating

There has been an acceptance of the need for student representation within
the U21 governance structures (which the student network has taken over and
is reshaping). There are no plans to include staff in any of the governance
structures of the new global university.

The University of Melbourne has stated that it wants to invest $US5m. Given
the acknowledged difficulties associated with Melbourne University Private,
there is a clear case of public interest to be protected.

The Co-operative Research Centre Program – a new model for
collaborative research between industry and the academy


Many universities have developed research relationships with industry,
benefiting from an injection of funds for applied research, with individual
academic staff also receiving royalties, as well as opportunities to follow
through their research to product development. The community as a whole
has benefited both from such applied research, but more importantly from the
basic research undertaken in universities that has been the backbone of
innovation. Such relationships have also driven economic and employment
growth – this has been important here on the west coast, where one third of
all the world’s biotechnology companies were founded by faculty members of
the University of California.

The report in Nature (11 January 2001) acknowledges that there have been
real benefits to researchers including:

     Access to industry facilities and databases

     Financial support for projects

     Opportunities for faculty to tap into market expertise

     Building up of long term networks

But there have been considerable problems:

        Researchers sponsored by companies are submitting work to
         international journals that is “biased in favour of reporting positive
         results relating to company products” (Nature, Vol 409, Issue no. 6817, 2001, (p.119)
     Restrictions on academic freedom via exclusive contracts – data
      collected often becomes the property of the company and the right of
      disclosure of research results became enmeshed within “commercial in
      confidence”. Some contracts limit discussion between faculty signed up
      to the contract and other faculty working on similar developments, in
      the department as well as elsewhere.

     Large industry funding contracts, such as the one between the
      University of California and Novartis, can also “buy” seats within
      university governance structures.

     These disadvantages are magnified when the research is in a highly
      contentious area, such as genetically modified crops, weapons
      development or human cloning. These are issues essential to debate,
      and the community has a right to such information in order to inform
      such a debate.

In developing our response, there are some hard questions to answer


     Whether faculty, in the interest of accountability, should hold shares in
      companies that provide research funding?

     What should the balance of benefit be between the creator, the
      university, the technology transfer organisation and the firm that
      markets the innovation?

     Where industry funds research, how is the balance to be struck
      between “commercial in confidence” and the “free exchange of ideas”
      in publishing research results?

     Where universities hold patents or strongly protect their own intellectual
      property, how are other researchers to have access to key information
      necessary for research that may or may not be related?

     If industry money becomes the main driver for research, are we in
      danger of losing diversity across research areas, and across

We have had some experience in dealing with these issues in Australia. For
over a decade the Federal Government has funded the establishment of Co-
operative Research Centres – these are centres that bring together
universities, other public sector research organisations, and industry partners.
There is a strong commitment towards the public interest, underscored by the
funding balance. As a small economy, many of the industry partners are small
to medium enterprises without the capital of US companies such as Novartis.
Government has historically played a central role in industry development and
industry assistance, and it is this tradition that helps explain their role in
sustaining the CRC Program.

Currently there are some 70 CRCs, with about 6 incorporated as companies.
Each has their own governing board where all parties are represented. The
CRCs undertake basic and applied research, and research training. Some
CRCs are co-located at a university campus, while others have their own
separate premises, often at a technology research park. The funding for
CRCs is primarily public funding – through universities and other public sector
agencies, as well as core funding distributed to CRCs from the government.

The balance is detailed below.




Universities                                                      33%
CSIRO                                                             20%


Federal                                                            6%
States                                                            13%

INDUSTRY                                                          24%

OTHERS                                                            4%
(Mainly Medical Research Institutes)

The public interest is also reflected in a set of broad objectives for the
program that encompass commercial concerns alongside public benefit
research and educational outcomes. These include:

     Collaboration between researchers

     Improving graduate outcomes

     Enhancing the contribution of long-term scientific and technological
      research to Australia’s sustainable economic and social development

     Transferring research into outcomes that are of commercial benefit

     Transferring research into outcomes for the social, economic and
      environmental benefit of Australia

CRC’s are regularly evaluated against their achievements of these objectives
in order to qualify for on-going program funding. They report directly to
Government, are reviewed on a 3-5 year basis, and public accountability for
both public interest, as well as the interests of the partners is a central part of
the program. Initially there was nervousness among our members about the
CRC program. Issues at the heart of their concerns were the shift towards
applied and strategic research, and the leaching of university resources to
CRCs and away from research within the university – both in terms of staff
and infrastructure. Yet members also reported genuine enthusiasm for
opportunities created by meaningful linkages with other research agencies
and industry partners, and the resultant benefits for postgraduate research
training and applied research. Support has grown with participation, and
interestingly opportunities for early career researchers and postgraduates
have been critical in building that support. For staff, intellectual property has


been the biggest site of tension – but now better arrangements based on
sharing IP have been made and staff seem relatively content.

The CRC Program has achieved industry objectives alongside public benefit
and educational objectives. The CRC for Sensor Signal and Information
processing has pursued a long-term research project to develop an
automated pap smear analysis machine. The project was recognised as ‘high
risk’, but as a worthwhile strategic venture. Not only is the project nearing the
point where commercialisation is viable, it has also provided the basis for six
PhD programs. While private benefit to industry partners will be substantial,
the public benefit in terms of improved diagnostic procedures will be
enormous. Similarly at the CRC for the Antarctic and Southern Ocean,
industry has seen the benefits of investing in long term basic research. Here a
major pharmaceutical company, AMRAD, recognises that the research may
return significant benefits in the future, although initially work will focus on
public good outcomes, and is funded accordingly.

The downside of the success of the CRC program has been to encourage
Government to effectively reduce in real terms its funding for basic research in
universities, giving priority in new funding allocations to research grant
applications that have industry partners. NTEU has been an industry partner
in three research projects and evidence collected has provided the Union with
hard evidence to use in both public campaigning and collective bargaining.

     A national study of pay equity in Australian universities

     A longitudinal study of occupational stress in Australian universities

     An investigation of the impact of increased casualisation of
      employment on educational quality within the education sector.

Campaigning in the public interest can be successful. Over the last two years,
NTEU has worked with a range of professional organisations in a campaign to
lift government investment in basic research, as well as improving career
opportunities for postgraduates and research staff. The campaign has had
high public visibility involving a ‘Science Meets Parliament’ initiative,
newspaper opinion pieces, questions in state and federal parliaments, as well
as public seminars. Under political pressure from the higher education lobby,
the Government announced a new research package in January 2001.
Backing Australia’s Ability included a doubling of research grant monies for
basic research, salary parity for research staff and post-doctoral fellows,
increases in infrastructure funding, and provision for a HECS style loans
scheme for postgraduate coursework students. Overall the package delivered
near $A3billion over five years, and represented a complete policy back-flip
for the Government.

While the terrain that we have traversed here is complex, nonetheless my
argument has been a simple one. Intervening in the debate about increasing
corporatisation of universities must be centred on managing cultural
difference. Strategies strongly in defence of the public interest can provide


university staff with a more powerful armory than that which attaches to a self-
interested view. If we claim that our work is in the public interest, and primarily
about enhancing public and community life, then we have a responsibility to
argue our case, both at a local and international level. And we can win.


APPENDIX 1: Funding of Australian Universities
            Sources of Income 1998

          Source                           $A billion             % of income

Commonwealth                                    4.295               50.8%
Govt Grants

HECS                                            1.451               17.2%

Fees & Charges                                  1.371               16.2%

Investment                                      0.290                3.4%

Donations &                                     0.115                1.4%

State Govt Grants                               0.090                1.1%

Other sources                                   0.845               10.0%

TOTAL                                           8.456                100%



Band 1: $A3,521                                     Arts, Humanities, Social
                                                    Studies, Behavioural
                                                    Sciences, Education,
                                                    Visual& Performing Arts,
                                                    Nursing, Justice & Legal
Band 2: $A5,015                                     Mathematics, Computing,
                                                    Health Sciences,
                                                    resources, Built
                                                    Sciences, Engineering,
                                                    Administration, Business
                                                    and Economics
Band 3: $A5,870                                     Law, Medicine, Medical
                                                    Science, Dentistry, Dental
                                                    Services, and Veterinary


     HECS covers 82% of domestic students

     Pay back via the tax system once average income
      reaches $A22, 346. (55.2% of average adult ordinary time

     Percentage of income you have to pay back each year
      depends upon annual taxable income. No market rate of
      interest but debt indexed for CPI.

     These fees represent between 30% and 80% of the cost
      of providing the place depending on the discipline areas.


                   Appendix 3: Australian Universities
                    Financial Safety Margin 1995-99






   2%                                                             4.4%



               1995               1996              1997          1998   1999

 Sources: DETYA Higher Education Report for the 2000 to 2002 Triennium , p. 27
       & DETYA Higher Education Report for the 2001 to 2003 Triennium , p. 55


        UNIVERSITAS 21

                Comprised of the                                           Thomson
                member institutions                                        The ‘outside money’.
                                                                           They own Prometric,
                                                                           who will do the
                                                                           assessment, as
                                                                           overseen by
 U21pedagogica                                    U21equity
 The quality control                              Owned by U21.
 organisation. Wholly                             Member institutions
 owned by U21. It may                             may choose or not to
 choose to do business                            put up equity, but all
 with other institutions.                         will be members
                                                  through the licence of
                                                  the ‘brand names’

         Jointly owned by U21 (through U21equity) and Thomson.

   Other institutions
U21pedagogica may sell its
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