EXPLANATORY STATEMENT
Guidelines issued under subsection 238-10 of the Higher Education Support Act 2003
Amendment No. 11 to the Commonwealth Grant Scheme Guidelines No.1
Issued by the authority of the Minister for Tertiary Education, Skills, Jobs and Workplace Relations
Subject: Higher Education Support Act 2003
Amendment No. 11 to the Commonwealth Grant Scheme Guidelines No.1
Authority
Section 238-10 of the Higher Education Support Act 2003 (the Act) provides that the Minister may make guidelines for the purposes of the Act. In particular, item 2 of the table at section 238‑10 specifies that the Minister may make the Commonwealth Grant Scheme Guidelines to give effect to matters set out in Part 2-2 and section 93-10 of the Act.
Purpose and operation
The Commonwealth Grant Scheme Guidelines No.1 commenced on 13 December 2006 and is being amended for the eleventh time.
The purpose of this amendment is to repeal the current provisions for regional loading and to give effect to the 2011-12 Budget measure by introducing new provisions for the calculation and payment of regional loading from 2012.
Explanation of amendments
Item 1 – Amendment to Chapter 1
The purpose of this amendment is to define a number of terms used in the Guidelines to facilitate readability and ease of use.
Item 2 – Amendment to Chapter 4
The purpose of this amendment is to replace Chapter 4 in its entirety. The new chapter will specify how the payment of regional loading, announced in the 2011-12 Budget, will be distributed from 2012.
Regional loading is funding paid to eligible providers for Commonwealth supported places under section 33-1(1)(b)(i) of the Higher Education Support Act 2003. Regional loading funding is intended to help providers offset the disparity in costs and revenue of regional campuses in comparison with major city campuses.
Originally, the regional loading was based on the distance of the campus from the closest mainland State capital city and the size of the higher education provider. From 2007 to 2011 the funding provided to each institution was based on the regional loading provided in 2006 indexed for each subsequent year. From 2012, regional loading funding will be distributed through a new formula that is transparent and responds to student demand. The new formula will target funding to regional campuses in accordance with the Australian Bureau of Statistics’ remoteness structure, which is based on access to goods and services. Funding will also be based on the student load enrolled at each regional campus, with a the minimum student load to ensure each campus has a significant physical presence.
Commencement
Amendment No. 11 to the Guidelines will take effect on 1 January 2012.
Consultation
The amendments to the Commonwealth Grant Scheme Guidelines No.1 give effect to 2011-12 Budget measures and reflect the Government’s response to the Review of Regional Loading. An external Regional Provision Reference Group was established by the Department to provide advice and guidance to the Department throughout the review.The Review involved extensive consultation with the higher education sector, including higher education providers, peak bodies, state and territory governments and other key stakeholders. The consultation involved a public submission process and face to face consultations in each state and territory. Details of the submission and the consultations are provided in the Review Final Report published on 11 May 2011. A copy of the Review Final Report, public submissions and commissioned research reports are available from the Department’s web site at http://www.deewr.gov.au/HigherEducation/Pages/ReviewOfRegionalLoading.aspx.
The provisions of the legislative instrument are intended to give effect to policy changes resulting from the Review of Regional Loading. On this basis consultation was not considered necessary and was not undertaken.
Overview
The Higher Education Support Act 2003, enacted by the Parliament of Australia, aims to provide financial support for higher education students and institutions, ensuring access to quality education across the country. The Act addresses the need for a structured and equitable funding system for higher education, particularly in regional and remote areas. In this context, the Commonwealth Grant Scheme Guidelines No.1 were introduced to provide detailed rules for the distribution of Commonwealth supported places, including regional loading for eligible providers. Amendment No. 11 to these Guidelines, issued under the authority of the Minister for Tertiary Education, Skills, Jobs and Workplace Relations, was enacted to implement the 2011-12 Budget measures and the findings of the Review of Regional Loading. This amendment seeks to enhance the transparency and effectiveness of regional loading funding by altering the calculation and distribution formula, targeting support more precisely to regional campuses based on student load and access to goods and services.
Scope and Application
The Higher Education Support Act 2003 applies to higher education providers in Australia, encompassing both universities and other eligible institutions, in the context of Commonwealth supported places. The Act is enacted at the Commonwealth level and thus applies across the nation, providing a consistent framework for the allocation of funding through the Commonwealth Grant Scheme. The Act facilitates the distribution of regional loading funding, intended to address the higher costs and revenue disparities faced by regional campuses compared to those in major cities. The amendment to the Commonwealth Grant Scheme Guidelines No. 1, effective from 1 January 2012, introduces a new formula for calculating regional loading, moving away from the previous method based on distance from State capital cities and provider size, to a model based on the Australian Bureau of Statistics’ remoteness structure and student load. This change aims to ensure funding is more effectively targeted to where it is most needed based on access to goods and services and actual student enrolments at regional campuses. The Act does not specify exclusions, exemptions, or thresholds but allows for the Minister to make guidelines, including those for the Commonwealth Grant Scheme, thereby extending the application of the Act through subordinate instruments.
Key Provisions
The main operative sections of this legislation, Amendment No. 11 to the Commonwealth Grant Scheme Guidelines No.1, primarily involve changes to how regional loading funding for higher education providers is calculated and distributed from 2012 (items 1 and 2). This amendment aims to replace the previous distance-based regional loading calculation with a new formula that is more responsive to student demand and based on the Australian Bureau of Statistics' remoteness structure (item 2). This change is intended to ensure that funding more accurately reflects the needs of regional campuses and better targets resources to areas where they are most required.
Under this Act, higher education providers are required to adhere to the new regional loading provisions outlined in the amended guidelines. Specifically, they must comply with the new formula for calculating regional loading, which takes into account factors such as the remoteness of the campus and the student load at each regional campus (section 33-1(1)(b)(i)). These provisions are designed to ensure that funding is distributed in a manner that more accurately reflects the needs of regional campuses and better supports higher education providers in these areas.
Breach of these provisions can lead to significant consequences. While the Explanatory Statement does not explicitly detail penalties for non-compliance, it is reasonable to infer that failure to adhere to the amended guidelines could result in the withholding of regional loading funds, or other administrative and financial repercussions. Providers must ensure they are fully compliant with the new provisions to avoid any potential negative impacts on their funding.
The legislation also outlines the process by which these changes were developed, including extensive consultation with the higher education sector and the establishment of a Regional Provision Reference Group. The changes give effect to policy decisions resulting from the Review of Regional Loading, and while consultation was considered unnecessary for this specific amendment, the process demonstrates a commitment to transparency and stakeholder engagement in the development of higher education policy.