Financing for equity in higher education
1. Education resources to subnational governments
2. Education resources to institutions
3. Education resources to students
4. Support for students' living costs
Introduction
Key financing indicators (UIS Data)
In Australia, between 2015 and 2023, the gross enrolment ratio for tertiary education marked 119.68% and 104.65% respectively. As of 2022, the initial government funding per tertiary student as a percentage of GDP per capita marked 15.79%. In the same year, initial household funding was 8.48%.
Tuition-free status
Public tertiary education is not tuition-free in Australia. Each university is established by a state or territory act of Parliament, which defines its legal status, governance structure, and financial powers. These establishing laws explicitly grant university councils or senates the authority to set fees and charges for courses and services. For instance, according to Part 6(36)(n) of the University of Sydney Act 1989 (NSW) states that “the council may determine fees, charges, and other amounts payable including entrance to the university, tuition, and lectures and classes. Similarly,) the University of Melbourne Act 2009 (VIC) and the University of Queensland Act 1998 (QLD) stipulate that the university has all the powers to fix charges for its services.
While the higher education institutions possess the autonomy to determine tuition fees, they are subject to compliance with national regulations under the Higher Education Support Act 2003, as section 19-85 requires that the providers charge the tuition fees in accordance with the requirements of the Act.
Governance
The Australian Government is the main funder of higher education, providing about 55% of the total revenue of public higher education institutions as of 2022. The Department of Education is the primary ministry responsible for allocating and overseeing higher education budgets. It also manages funding schemes such as the Commonwealth Grant Scheme and student loan programmes.
1. Education resources to subnational governments
The Australian government, primarily through the Department of Education, allocates the funding directly to public higher education institutions, rather than through local or regional governments for redistribution. State and territory governments play only a minor financial role, contributing limited funding mainly for infrastructure and research projects. In 2022, their contribution accounted for approximately 2.7% of the total revenue of the 42 higher education providers listed under the Higher Education Support Act 2003.
2. Education resources to institutions
Funding for private universities in the absence of public institutions
The Australian Government funds higher education mainly through the Higher Education Support Act 2003, which applies primarily to public universities listed under Table A of the Act. A number of private higher education institutions, classified under the Table B in the Higher Education Support Act 2003, are eligible for limited Commonwealth support when they advance national policy priorities, as stipulated in Division 30 of the Act. Eligible institutions may access Commonwealth funding under schemes such as the Commonwealth Grant Scheme and Indigenous Student Assistance Grants, as well as other targeted programmes designed to promote equity and equal opportunity in higher education.
Allocation and equity
The main funding mechanism is the Commonwealth Grant Scheme (CGS), which provides subsidies for each student place based on discipline and student load. Allocations are determined annually through funding agreements between the Department and each university. In addition to the CGS, universities receive targeted grants that promote equity and access for underrepresented groups.
Indigenous Student Assistance Grants
Under Division 38 of the Higher Education Support Act 2003, the Government provides Indigenous Student Assistance Grants to Higher education providers. These grants aim to assist Aboriginal and Torres Strait Islander students to enter, progress in, and complete higher education. Funding may be used for scholarships, academic support, supplementary tuition, pastoral care and strategies to improve Indigenous student outcomes and foster culturally safe learning environments. Grants are approved annually by the Minister through the Indigenous Student Assistance Grants Guidelines, which also set conditions of eligibility, funding amounts, and reporting requirements.
Programmes that Promote Equality of Opportunity in Higher Education
The Higher Education Participation and Partnerships Programme (HEPPP) provides annual grants to universities based on their share of students from low socio-economic, regional, remote, and Indigenous backgrounds, supporting outreach, academic assistance, and retention initiatives. The Regional Partnerships and Regional Loading Programmes provide additional funding to universities and Regional University Study Hubs to enhance access and offset the higher operating costs of campuses in regional and remote areas.
The Disability Support Programme includes three targeted funds to promote equality of opportunity for students with disability in higher education. The Disability Support Fund (DSF) offers annual supplementary grants to Table A universities based on enrolments of domestic students with disability and the number of students requiring high-cost educational support (above AUD 5,000 per year). Funds may be used for educational support, assistive equipment, curriculum adjustments, staff training, and implementation of inclusive teaching practices, but not for infrastructure or personal care. The Australian Disability Clearinghouse on Education and Training (ADCET) provides funds for information, training materials, and online resources to promote inclusive teaching and learning across the higher education sector. The Capacity Building Fund (CBF) supports a designated university to strengthen the capabilities of other institutions in supporting students with disability, through sector-wide training and institutional development.
Women in STEM Cadetships and Advanced Apprenticeships Programme
The government provides grants to higher education providers and participating employers to increase the participation of women in STEM fields of education. The programme supports part-time study models that allow women to remain employed while undertaking cadetships or advanced apprenticeships leading to Australian Qualifications Framework (AQF) Level 5 or 6 qualifications. Participating institutions and employers must enter deeds of agreement with the Commonwealth, ensure flexible study arrangements, and report biannually on enrolment, progression, and completion outcomes.
3. Education resources to students
Admission for vulnerable groups
Admission to Australian higher education institutions is governed by the Higher Education Standards Framework (Threshold Standards) 2021. Under Part A, Section 1.1 (Admission), universities are required to have documented admissions policies and procedures that are applied fairly and consistently. In addition, Part A, Section 2.2 (Diversity and Equity) mandates that institutions accommodate student diversity and create equivalent opportunities for academic success regardless of background, with specific consideration for the recruitment, admission, participation and completion of Aboriginal and Torres Strait Islander students.
Additionally, according to the Higher Education Administrative Information for Providers (AIP), higher education providers may take into account the educational disadvantages that an individual applicant has experienced when selecting students, as permitted by the Higher Education Support Act 2003. This consideration should be based on the specific and demonstrable disadvantages affecting the applicant, rather than applying a general assumption of disadvantage.
Scholarships, grants and loans for vulnerable groups
The Tertiary Access Payment (TAP) Programme
The TAP programme is a means-tested financial support to assist students from regional and remote areas who must relocate to pursue full-time tertiary education. Eligible students receive a one-off payment of AUD 5,000 (for outer regional and remote students) or AUD 3,000 (for inner regional students) in their first year of study to offset relocation and living costs. The programme aims to reduce disparities in tertiary attainment between metropolitan and regional areas, support Indigenous participation, and contribute to the Government’s Closing the Gap targets.
Equity Scholarships in Australia are designed to support students who face financial hardship or other educational disadvantages. To apply for an Equity Scholarship, one must be enrolled at a participating institution. There are two main types: Institution Equity Scholarships, which are funded by individual universities (with eligibility, value, and duration varying by institution), and the Indigenous Student Success Programme, which is funded by the Australian Government. Recipients are typically those receiving Centrelink income-support payments or otherwise able to demonstrate high financial need, and many institutions consider additional factors such as remoteness, disability, or carer responsibilities.
4. Support for students’ living costs
Allowance
ABSTUDY Allowances for Higher Education Students
Among the various ABSTUDY allowances for higher education students, the ABSTUDY Living Allowance is a key programme designed to support full-time Aboriginal and Torres Strait Islander students pursuing higher education, including undergraduate, master’s, and doctorate programmes. The payment amount depends on factors such as age, living arrangements, and whether they live at home or away from home. This allowance helps cover essential living costs like food, utilities, and personal expenses, reducing financial barriers and enabling students to focus on their studies.
Youth Allowance is a financial support payment provided by the Australian Government to help young people aged 18 to 24 who are studying full-time and facing financial need. The programme assists eligible tertiary students with living costs while they complete their studies. To qualify, applicants must be Australian residents and meet income and assets tests. The payment amount varies depending on factors such as whether the student lives at home or independently, their income, and whether they have a partner or dependents. Youth Allowance is intended to reduce the financial barriers to education and ensures that young Australians from diverse socioeconomic backgrounds can continue their studies without undue financial hardship.
Transportation
At the federal level, there is no universal student transport discount in Australia, but programmes like ABSTUDY Fares allowance provide financial support that can help Indigenous students cover transport costs. Direct transport concessions are instead managed at the state and territory level. For example, in New South Wales, full-time tertiary students can benefit from discounted fares on trains, buses, ferries, and light rail. Similarly, Victoria and Queensland offer discounts on transportation to help make commuting to university more affordable.
Accommodation
Rent Assistance is provided by the Australian Government to help students and other eligible recipients manage housing costs. It is not a stand-alone payment but an add-on available to those already receiving income support, such as Youth Allowance. Students who rent privately may qualify if they pay above a set minimum rent amount. The payment is calculated based on how much rent a person pays, up to a maximum rate, which varies depending on living arrangements, marital status, and whether they have dependents.
Textbooks
Students can receive financial support for textbooks and other essential course materials through the ABSTUDY Additional Incidentals Allowance. This is available to full-time higher education, master’s, and doctorate students of Aboriginal and Torres Strait Islander background, whose essential course costs, such as textbooks, library fees, laboratory fees, and union fees, exceed a set minimum for the length of the course. The allowance covers costs above the threshold, up to $2,080 per year, and is claimed separately from the standard ABSTUDY Incidentals Allowance.
This profile was reviewed by the Australian Government Department of Education.
