Labor wants to restore ‘demand driven’ funding to universities: what does this mean?

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Labor says it will bring back demand-driven funding for universities if it wins this month’s election. Put simply, this means instead of the government providing each university with a fixed sum of money for teaching (which is what happens now), it would instead provide funds based on how many students have actually enrolled.

The Australian government operated a demand-driven funding system for public universities between 2012 and 2017. During these years, universities could enrol unlimited numbers of bachelor-degree students into any discipline other than medicine and be paid for every one of them.

Although universities did not have to meet demand from prospective students, they had much more freedom to do so. Moving to a demand-driven system is also referred to as scrapping the “cap” on government funding of university places.

Labor’s policy wouldn’t only give universities a funding boost, it would help universities adapt to and plan for future needs. Here’s what happened last time demand-driven funding was introduced, and why the policy changed.

Read the full article on The Conversation.

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