Universities: Lacking a Higher Purpose, By James Reed
The report, A Higher Purpose: Towards Better Governance for Australian Universities, and the accompanying article, Time to Clean Up Australia's Failing, Scandal-Plagued Universities, argue for reforms to address the problems of Australian universities:
https://australiainstitute.org.au/post/time-to-clean-up-australias-failing-scandal-plagued-universities/
These proposed reforms are insufficient I will argue, and that the corruption in Australian universities is so deeply entrenched that the only viable solution is to shut them down entirely and rebuild the higher education system from the ground up.
Australian universities have long been regarded as prestigious institutions, but beneath the surface, they are plagued by systemic corruption that undermines their integrity and public trust, as the report and article notes. One of the most glaring issues is the rampant wage theft that has become almost normalised in the sector. Over the past decade, numerous universities have been exposed for underpaying staff, particularly casual and academic workers. For example, the University of Melbourne, University of Sydney, and University of New South Wales have all admitted to underpaying staff by millions of dollars, with estimates suggesting that wage theft across the sector could total over $300 million. This isn't a case of isolated errors but a deliberate practice, often enabled by opaque governance structures that prioritise profit over fairness.
Beyond wage theft, there's a culture of unaccountability at the highest levels. University leadership, including vice-chancellors, often earn exorbitant salaries—sometimes exceeding $1 million annually—while overseeing institutions that exploit their lowest-paid workers. These leaders are frequently appointed through non-transparent processes, with governing councils packed with corporate figures who have little understanding of academia's core mission. The Australia Institute report highlights this governance failure, pointing to a lack of democratic oversight and the influence of external interests, such as property developers and private donors, who steer universities toward commercialisation rather than education.
Another major issue is the treatment of students, particularly international students, who are often treated as cash cows. Australian universities rely heavily on international student fees, which make up a significant portion of their revenue—sometimes as much as 30-50 percent at top institutions. This dependency has led to lowered academic standards, with reports of universities admitting students who lack the necessary qualifications and pressuring academics to pass failing students to maintain revenue streams. The 2020-2021 period, during the Covid-19 pandemic, exposed this vulnerability when border closures led to a sharp drop in international student numbers, yet universities doubled down on cost-cutting measures like staff redundancies rather than addressing the underlying structural issues.
Scandals involving sexual assault and harassment on campuses further illustrate the depth of the problem. Despite high-profile cases and inquiries, such as the 2017 Australian Human Rights Commission's report on sexual assault in universities, many institutions have failed to implement meaningful change. Reports of cover-ups, inadequate support for victims, and a lack of accountability for perpetrators—especially when they are senior staff or high-value donors—point to a culture that prioritises reputation over justice.
The Australia Institute's proposed reforms, while well-intentioned, focus on incremental changes: better governance structures, increased transparency, stricter oversight of executive pay, and stronger protections for staff and students. These measures include mandating more independent members on university councils, improving whistle-blower protections, or enforcing stricter penalties for wage theft. However, these reforms fail to address the root of the problem: a higher education system that has been fundamentally corrupted by decades of neoliberal policies and market-driven priorities.
For one, the governance issues are not just a matter of poor oversight but a reflection of a broader cultural rot. University councils are often stacked with political appointees and corporate figures who have little incentive to challenge the status quo. Even if reforms introduce more independent members, the entrenched power dynamics—where vice-chancellors and their allies hold disproportionate influence—will likely undermine any meaningful change. The same leaders who have overseen wage theft, student exploitation, and scandal cover-ups are unlikely to willingly cede power or admit fault.
Moreover, the financial model of Australian universities is inherently flawed. The reliance on international student fees and government funding tied to performance metrics (like graduate employment rates) incentivises universities to prioritise revenue over education. Reforms that don't address this funding model—such as fully funding universities through public investment and removing market-driven incentives—will only perpetuate the cycle of exploitation. The Australia Institute might argue for increased government oversight, but this assumes that the government itself isn't complicit in the problem. Successive Australian governments, both Labor and Liberal, have pushed universities toward privatisation and commercialisation since the 1980s, creating the conditions for these scandals in the first place.
Finally, the cultural issues—such as the normalisation of wage theft, the silencing of whistle-blowers, and the failure to address sexual assault—cannot be fixed through policy tweaks alone. These problems are deeply embedded in the institutional DNA of Australian universities, perpetuated by a lack of accountability and a leadership class that is more concerned with self-preservation than reform. Incremental changes, like those proposed by the Australia Institute, might address some symptoms but will fail to tackle the underlying disease.
Given the depth of corruption and the systemic nature of the problems, the only viable solution is to dismantle the current university system and rebuild it from the ground up. This would involve several radical steps:
1.Close Existing Institutions: Temporarily shut down all public universities to break the cycle of corruption and remove the current leadership and governance structures. This would send a clear signal that the status quo is unacceptable and force a reckoning with the sector's failures.
2.Rebuild with Public Funding and Oversight: Create a new higher education system that is fully publicly funded, with no reliance on international student fees or private donations. This would remove the market-driven incentives that have led to exploitation and lowered standards. Governance should be democratic, with elected representatives from staff, students, and the broader community, rather than corporate appointees.
3.Prioritise Education Over Profit: The new system should be built around the core mission of education and research, not revenue generation. This means abolishing performance metrics that incentivise universities to game the system (e.g., by inflating graduate employment rates) and ensuring that academic standards are upheld, even if it means smaller class sizes or fewer students.
4.Enforce Accountability: Any new system must have robust mechanisms for accountability, including independent oversight bodies with the power to investigate and penalise misconduct. Whistle-blower protections should be ironclad, and there should be zero tolerance for wage theft, sexual assault, or other forms of corruption.
5.Cultural Reset: Rebuilding the system provides an opportunity to reset the culture of higher education. This means prioritising justice and democracy in all aspects of university life, from hiring practices to student support services. It also means fostering a culture of transparency and accountability, where scandals are addressed head-on rather than swept under the rug. Universities at present are like something out of Kafka's The Trial, based around governance by opaque rules that are not openly disclosed.
One might argue that shutting down universities, even temporarily, would cause significant disruption to students, staff, and the broader economy. While this is true, the long-term benefits of a reformed system outweigh the short-term costs. The current system is already failing students and staff, with declining academic standards, exploited workers, and a lack of support for vulnerable groups. A temporary closure, if managed carefully—such as by providing financial support for staff and students during the transition—would be a small price to pay for a system that actually serves its purpose.
Another counterargument is that some universities are less corrupt than others and should be spared. However, the problems outlined above are systemic, not isolated. Even "better" universities are complicit in the broader culture of exploitation and unaccountability, whether through their reliance on international student fees, their failure to address wage theft, or their silence on sector-wide issues. A complete overhaul is necessary to ensure that no institution can continue to operate under the old, corrupt model.
The Australia Institute's report and article rightly highlight the scandals and governance failures plaguing Australian universities, but their proposed reforms are a band-aid on a gaping wound. The corruption in the sector—manifested through wage theft, student exploitation, unaccountable leadership, and a culture of cover-ups—is so deeply entrenched that incremental changes will never suffice. The only way to truly address these issues is to shut down the current system and rebuild it from scratch, with a focus on public funding, democratic governance, and a return to the core mission of education. Anything less will allow the rot to persist, further eroding public trust in what was once one of Australia's most important institutions, but now is the most corrupt.
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