Australian universities need public funding to be global players

“Australia has no university in the world’s top 100 universities”, we are told.

This argument has been made repeatedly by the Vice-Chancellor of the University of Melbourne, who wants to charge high fees to many of his students to build Melbourne’s resource base. The argument has been echoed by the Governor of the Reserve Bank, Ian Macfarlane, and newspaper editorials.

And it has been taken up by the federal Minister, Brendan Nelson, and used to justify the proposed reforms of higher education now before the Senate.

But is it true? Who is in the top 100? How do we get there?

Well, it is about time it was said. Unfortunately for the Vice-Chancellor and Minister, there is no such thing as the “world’s top 100 universities”. The whole notion is a mirage, a furphy, an invention of the speechwriter. To drive policy on this basis makes no sense.

What we do have is a list of the top 100 American universities, published by the US News and World Report. The top 100 are ranked on peer assessment (their ranking of each other, including research performance), graduation and retention rates, staff and financial resources, student selectivity (how hard it is to get in) and alumni donations.

You can argue with the measures, and it could be done many different ways. On the measures, the top ten are Princeton at number one: Harvard and Yale tied at two; Caltech, Duke, MIT, Stanford and the University of Pennsylvania tied at four, followed by Dartmouth College nine, and Columbia and Northwestern equal ten.

The rankings reflect the prestige of private universities in the American system and the role of private companies, philanthropy and alumni in financing. Outside America, most of the great universities are public institutions and in no other nation does education have access to private resources on the American scale.

Now, it is true that if the same measures were used across the world, creating a world’s top 100, there would be no Australian universities there. Apart from Oxford, Cambridge and London there would be precious few British, European or Asian universities. Using American criteria, most of the world’s top 100 would be American.

Does that mean every country in the world apart from the USA is pursuing the wrong policies, and they should adopt Nelson-style policies to be globally competitive? No.

We can use common measures of the research output of universities but other indicators vary by nation. For example the availability of private money varies a lot. A university can only be “great” according to the conditions of possibility in its own country. It can only be as globally strong as the global position its own nation allows.

Australia commands 2% of world GDP and 2% of research output. It is not the dominant world power. It is a developed nation with areas of global strength.

Australian universities can be global players. But unlike American universities (though like European and Asian universities) if Australian universities want to be first class they need first class public funding.

In our system private money helps but public investment is decisive.