Ch 3: Intervening to instate a free market: Dawkins (1987-1988)

The breadth of the gap between each side of the debate seemed to widen in 1987, as none of Minister Ryan’s statements against fees impacted the fervour of those either for or against them. The debate in the Higher Education Supplement seems feverish as each side tried to influence public opinion as the 1987 election approached.[1] Student and staff unions focused their attention on protesting against the small tertiary administration fee, and opposing the polemic of desperate Vice-Chancellors, devout economists, free-market “think-tanks” and other academics who discussed the possibility, sometimes directly with government, that fees might be a good idea.[2] While Susan Ryan wrote to the Higher Education Supplement to explain that students would be far worse off under a Liberal government[3], the Prime Minister, Bob Hawke, squashed much hope of public funding increases by declaring the period of “ivory tower luxury” to be over.[4] Research commercialisation continued to be encouraged, with occasional conflict of interest controversies.[5] The University of Sydney “while it has not gone so far as many of its brasher colleagues”, reported the Supplement, “has set up a Business Liaison Office” – two years after the apparently equally staid University of Melbourne “finally” relented on the need to earn cash on the side through commercial research.[6]The discussion surrounding what many perceived to be a need to shift more research funding from recurrent university-controlled funding to a competitively-awarded, government-controlled Council centred on the belief that the best research was that which directly met “national needs”, as determined by government.[7] It was mid-1987 before the Australian Research Council was finally formed (it was delayed by bickering over responsibility for it between government departments).[8]

Privatisation continued to be a central issue and the Liberal-National coalition’s election policy included firm support for the further development of a private sector in higher education, argued to appeal to universities by emphasising the benefits of decentralised funding to institutional autonomy.[9]Bond Corporation’s plan for a private Gold Coast based university, attractive to Asian students (though with a stated priority for Australian students) was rivalled by plans by the Parry Corporation for a similar private university in Western Australia (Kevin Parry, presumably coincidentally, was also a rival of Bond in the America’s Cup yacht race).[10] 1987 was a very bad year for Parry, however, who spent $20 million losing the America’s Cup and then lost everything else in the stock market crash in October. As a result, his private university idea did not progress. An unrelated hybrid public-private university was planned for the Northern Rivers in NSW, but was withdrawn under a corruption cloud.[11] Increasing numbers of academics ‘speak out’ in the Supplement about the potential value of privatisation to the system and the higher education research centres at New England and Melbourne held a joint conference on privatisation in Canberra.[12] None were more vocal than Bond’s Don Watts, however, who said:

Privatisation was the most important innovation ever in Australian Higher Education.[13]

Three weeks after Labor successfully defended the Federal election, once the Ministerial portfolios were redistributed, journalist William West described the new minister responsible for higher education under the headline “New Minister: wait and see”:

Earlier in his career the new Minister for Education, Employment and Training, Mr Dawkins, had a reputation as a radical in the Whitlam tradition – someone who felt strongly about social issues. Things have changed.[14]

Susan Ryan, who had opposed fees despite a Hawke cabinet that generally supported it, resigned from politics at the end of the year.[15]John Dawkins entered an existing debate – a scene where the higher education sector was divided over the ideology of funding knowledge in Australia and in universities, a lived debate that was resulting in immense changes through dialectical processes.

When Dawkins commenced his ministry, he sought out some of the most vocal and prominent members of the academic community who were already working towards a marketised sector in which knowledge would be commodified. Dawkins was keen to have advisors, as one of his staff put it, who would “tell Dawkins what Dawkins wanted to hear”.[16] He formed an informal group of advisors that came to be known as the Purple Circle. Don Watts was a prominent member of this Purple Circle, as were Helen Hughes, Don Aitkin and heads of a handful of other institutions, presumably selected for their sympathetic stance. Marginson and Considine note obvious absences from the group – especially Peter Karmel and the Vice-Chancellor at Melbourne, David Penington – who were to become critics of Dawkins’ policies, which supports the probability that the Purple Circle were selected to ensure Dawkins was not subject to people who would disagree with him.[17] Two members shortly took high level government positions – Don Aitkin was to become head of the Australian Research Council and Bob Smith soon moved from his role as Vice-Chancellor of the University of Western Australia to head Dawkins’ new super-department NBEET (National Board of Employment, Education and Training).[18] Dawkins’ staff member Allen Mawer said that they somewhat regretted needing to form the official body, but they needed to replace the Purple Circle, because it:

…caused a great deal of pain out there in the sector as a whole. It was fine for those who were in it, but for those who were outside it they felt excluded and marginalised.[19]

Undoubtedly this was because they were excluded, for Dawkins entered the debate leaning very strongly – and with funding power – on one side of it and with apparently little patience for viewpoints he did not share. Despite the strength of his position, however, this was not a debate Dawkins invented.

The existence of the Purple Circle shows one flaw in the common perception of the drivers of the changes associated with Dawkins’ tenure as Minister. Simon Marginson (who throughout the period was a research officer for a major staff union[20]) identifies Commonwealth government policy changes as central to the move towards a marketised, commodified education and research university system.[21] To this “push-type” causal force, Michael Gallagher, looking at the emergence of entrepreneurial universities, adds the “pull-type” driver of growing market opportunity as the explicit development of a globalised knowledge economy intensifies in the 1980s.[22] The tendency of public universities in Australia to have taken advantage of these opportunities is normally seen as a response to the funding squeeze imposed on universities by government, a narrative where government compelled universities to (unwillingly) commodify knowledge.[23] That is, despite Gallagher’s description of the pull of “opportunities” the causes of commodification are generally seen as push-type changes – changes imposed on reluctant universities by government policies, squeezed budgets and neo-liberal ideologies. It is assumed that this positioned university administrations and academics as helpless victims of these forces. Such an interpretation may be a result of drawing primarily on government sources, which inevitably make change look to be a result of policy. The implication that no one with influence in the higher education sector wanted to shift towards a commodified, marketised model is clearly wrong. The mere existence of the Purple Circle demonstrates the complicity of at least some members of the higher education community in the process of change.

Marginson and Considine describe Dawkins’ release of the Green Paper, Higher Education: a policy discussion paper, as “as bold and threatening document as the universities had ever faced”, which it certainly would have been from where Marginson was sitting at the time, in the staff union, known as the Federation of Australian University Staff Association or FAUSA. But not all academics – and certainly not all vice-chancellors – saw Dawkins or the Green Paper as a threat at all. John Ward, then Vice-Chancellor at the University of Sydney, welcomed many aspects of the Green Paper – though he later said that this was because he thought it signified a government belatedly attentive to the needs of higher education.[24]The Australian Vice Chancellor’s Committee was “cautious” about it – in fact the vice-chancellors were certainly divided, since some members were also a part of Dawkins’ Purple Circle and their views were expressed with integrity in the Green Paper. The Higher Education Supplement analysed responses in December 1987, a few weeks after the Green Paper’s release, and found, with some recommendations for amendments to the reforms, most interest groups were generally (though tentatively) supportive of it.[25] At a conference held specifically for leaders in higher education to discuss the Green Paper in early 1988, Gregor Ramsay (then Director General of the NSW Education Department) said:

Judging by the tone and debate of the Green Paper, however, the academic community does not feel unduly threatened by the new directions, and such an approach is not necessary. There are some concerns and disagreement certainly, but, with a few minor exceptions, the comments are based on at least an understanding of the Government’s purposes and are couched in rational terms. In general, there is a high level of acceptance of the ideas put forward in the Green Paper within the community.[26]

Contention over the reforms escalated in 1988, leading up to the release of the White Paper in July, as options for a proposed graduate tax were discussed.

A graduate tax was obviously a fee, applied after the fact, but neither side of the debate within higher education were convinced by it. Anti-fees groups maintained that all education should be free and a tax was a fee in disguise. Pro-fees groups were concerned that a graduate tax would not achieve all that it was hoped fees would. Fees, according to the neo-liberal agenda, were intended to create a climate of competition, forcing universities to compete for students so that quality would bear a direct relationship to income in an explicitly marketised and competitive environment.[27] Fees paid after graduation would not really do this, so the idea was “scorned as naïve”, according to The Australian.[28] Don Watts (probably imagining a private higher education system with identically motivated clientele to private high schools) said:

Thinking parents will surely make sacrifices now rather than allow their children to inherit a tax liability.[29]

The introduction of fees as a graduate tax did little, initially, to add the sense of exchange that Watts was looking for. But the process of commodification was proceeding apace without the aid of that particular coup. Rather than engage in any debate with the sector, Dawkins asked ex-NSW Premier Neville Wran to lead a committee to come up with a graduate tax scheme, leading to the eventual adoption of the Higher Education Contribution Scheme, known as HECS.[30]In the end, a graduate tax may have been the most peaceful fee compromise, since the Australian Vice-Chancellors Committee supported it – though within a year, Vice-Chancellor Committee support would not guarantee peace, as we’ll see.[31]

While change may have been occurring anyway, there is no doubt that Dawkins pushed it harder and further than it is likely universities would (or could) have done on their own. While responses to the Green Paper, seen in the Higher Education Supplement, were initially benign, the tone of contributions suggests that the sector seemed to feel the scale of the threat as 1988 progressed, so that responses to the White Paper in July were nothing short of panicked. This shift of response between the Green and White Papers seems strange, especially when Marginson and Considine’s way of describing Dawkins’ lack of responsiveness to the sector was that the White Paper might almost have been created by simply photocopying the Green.[32]The pages of the Higher Education Supplement suggest that the sector generally thought the Green Paper was what it purported to be – a discussion paper – rather than what it turned out to be: a notice of intent. Discussion commenced civilly, until the White Paper declared real change.

The Dawkins reforms were positioned, in the Green and White Papers and their summaries published in the Higher Education Supplement, as a response to a globalising world, where knowledge flows like money and the national economy is unable to function independently.[33] It sought enhanced efficiencies by conflating the college and university sectors and by instituting new performance-based funding regimes to encourage increased managerialism and entrepreneurship.[34] It supported institutions to seek non-Commonwealth funding – but focused this on student-sourced funding contributions (the graduate tax).[35]While Dawkins affirmed support for the small, pre-existing private institutions, he also reiterated that private institutions (Bond specifically) would receive no public funds. This extended to Bond’s students, since the White Paper said that only students enrolled in Commonwealth-funded courses would be eligible for Federal support through the living assistance scheme known as AUSTUDY.[36]

None of this was terribly surprising. Those who were against it stayed against it but their ranks were swelled by some surprising additions. In terms of higher education funding, 1988 was a special year, withdrawn from the normal rounds of triennial funding because of Dawkins’ review, to enable the Commonwealth to implement its findings without delay.[37]The universities anticipated a return to the normal triennial funding in 1989, as indeed was the plan, according to the White Paper. The difference was that universities now had a choice. Dawkins invited universities to become members of the Unified National System of higher education, which was to function exactly as he wished. If they chose to accept Dawkins’ invitation, they would be eligible for the base funding allocated in the next triennium. Universities could choose to not become members, but if they chose autonomy (as most vice-chancellors saw it) they would not be eligible for funding.[38] This was clearly not an option, but did leave vice-chancellors in an extremely difficult position – no vice-chancellor wanted the distinction of having handed over their university’s autonomy in exchange for funds. Indeed, John Ward, vice-chancellor at Sydney, was not sure, under State law, that he legally could hand that much control to the Commonwealth.[39] Ward was livid about the whole situation and wrote to (and eventually for) the Higher Education Supplement to point out the “strangulation” to knowledge when government controls it.[40]Ward at Sydney and Penington at Melbourne were determined to refuse Dawkins’ “invitation” to the national system if they could.[41] Since both were arguably among the wealthiest of Australia’s universities, they were certainly the best chance of doing so. Of course they found, by the deadline, they could not.[42]

Vice-chancellor finance and autonomy woes were exacerbated by what seems, in the pages of the Higher Education Supplement to be hurt, as a result of various accusations throughout the Dawkins documents of university wastefulness and poor management, which they felt undervalued the work of academics and the successes of institutions – and perhaps even the validity of their own work.[43]Moreover, there were still difficulties with the new Australian Research Council, especially because the Council was deciding on priorities for research that did not necessarily align to what universities wanted to do. This created a second front along which universities needed to defend their autonomy – so university attacks on the Council were increasing. Things were obviously getting quite heated – for example, a nasty war of words transpired between Australian Research Council head Don Aitkin and a professor of Classics at Melbourne University, when Aitkin described Arts academics as “wankers”.[44]