Compacts and Performance Funding Frequently Asked Questions
- Compacts
- Facilitation Funding
- Reward Funding
1. Compacts
1.1 Why is the Compact for three years if demand driven funding is being introduced in 2012?
- Compacts were announced in the 2009-10 Budget as part of the Transforming Australia’s Higher Education System package of reforms. The Compacts process commenced with the introduction of Interim Agreements for 2010.
- The Compact has been structured so that elements can be added or removed as required. Although the introduction of the demand driven system will require changes to the Compacts, we will ensure that universities are engaged in this process.
1.2 Isn’t there a contradiction between the ‘hands off’ approach of a demand driven system and increased monitoring of university activities through Compacts?
- Compacts are not intended to direct or monitor the totality of university activities. They are intended to provide a strategic framework for the relationship between the university and the Australian Government.
- Compacts will bring together information about the university’s mission, teaching and learning, research and public funding. In doing so, they will demonstrate the shared commitment of universities and the Government to providing students with high quality educational experiences and outcomes and to building research and innovation capabilities and international competitiveness. Including detail of Government funding through DEEWR and DIISR programs will facilitate transparency.
- The Compact document is clear that the university is responsible for its own mission and the way that it is described.
1.3 Why is the Compact a legal agreement not an MOU?
- The Compact template is based on the form of the Interim Agreement and takes account of the sector’s views expressed during consultations. The Compact has been developed to be clear and easily understood, but as the Compact is the mechanism for the delivery of some funding, it needs to be legally binding. If the Compact wasn’t able to include funding agreements (eg: for Performance Funding and the Commonwealth Grant Scheme), there would need to be multiple separate agreements in addition to the Compact. Having one Compact including these funding agreements is one way to help streamline funding delivery.
1.4 Are state and territory governments involved in the Compact process?
- As Compacts are agreements between the Australian Government and the university, these are the only parties that will attend Compact meetings. However, the Government recognises the legitimate interests of state and territory governments and has engaged with them through several bilateral discussions which have provided opportunities for sharing information on relevant issues to inform Compact negotiations.
1.5 Who will the government have Compacts with?
- The Government will have Compacts with all Table A and Table B providers listed in the Higher Education Support Act 2003.
1.6 How will the Government report back to the sector on Compacts?
- Following finalisation of all Compacts, DEEWR and DIISR will provide a report back to the sector, similar to that provided following the finalisation of Interim Agreements in early 2010. This will provide an overview of the ‘big picture’ and emergent national issues and will draw out key themes from Compacts and Compact meetings. The report back to the sector will be made available on DEEWR and DIISR websites.
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2. Facilitation Funding
2.1 What do universities have to do to receive Facilitation Funding in 2011?
- Facilitation Funding will be tied to up-front agreement on strategies for achieving the university’s teaching and learning mission and agreement to targets relating to specific Australian Government goals.
2.2 Does agreement to the conditions required for Facilitation Funding guarantee payment for the life of the Compact?
- Facilitation Funding has been allocated for the Compact period.
2.3 Are universities being asked to agree targets for indicators which have not yet been developed to receive Facilitation Funding?
- To be eligible to receive Facilitation Funding universities will be required to agree:
- quantitative targets for two indicators, the participation of students from low socioeconomic backgrounds and those from an other underrepresented group for 2012 and 2013.
- to participate in the development of the four other indicators and establish baseline performance relating to student experience and quality of learning outcomes.
2.4 Can universities opt out of Performance Funding arrangements?
- Performance Funding will consist of two components, Facilitation Funding and Reward Funding.
- Facilitation Funding will be tied to up-front agreement on strategies for achieving the university’s teaching and learning mission and agreement to performance targets relating to specific Australian Government goals. Once agreed, Facilitation Funding would be guaranteed for the 2011-2013 Compact Period.
- Reward Funding will be awarded to universities that achieve their performance targets.
- Universities that do not agree performance targets will not receive Facilitation Funding or Reward Funding.
2.5 How will Facilitation Funding be allocated across universities?
- For 2011, the Facilitation Funding will be calculated on the university’s share of the total Commonwealth Grant Scheme (CGS) basic grant amount in 2011 and, where applicable, the university’s share of grants to support National Institutes specified in the Other Grants Guidelines in 2011.
- The Commonwealth Grants Scheme Guidelines will outline the allocation mechanism for Facilitation Funding.
2.6 When will the Facilitation Funding be paid?
- Facilitation Funding will be paid fortnightly once Compacts have been signed.
2.7 Will Facilitation Funding be rolled into the base from 2012?
- Facilitation Funding is guaranteed for the Compact period and will be independent of the basic grant amount. Payments will commence early each calendar year.
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3. Reward Funding
3.1 How much Reward Funding is being allocated?
- Reward Funding of $27.6 million will be available each year from 2012 (indexed in later years) to universities that meet their Performance Funding targets for the two participation and social inclusion indicators (for students from low socioeconomic backgrounds and those from an other underrepresented group).
3.2 How many winners will there be in the Reward Funding scheme?
- At-risk Reward Funding will be awarded to all universities who meet their performance targets.
3.3 What happens to the calculation of Reward Funding if one or more universities don’t achieve their performance targets?
- Universities that do not achieve a performance target will not receive Reward Funding.
- Reward Funding is allocated according to the university’s share of the CGS basic grant amount.
- Unlike the previous Learning and Teaching Performance Fund (LTPF), the Reward Funding available to each university is unaffected by the performance of other universities.
3.4 Will Reward Funding be available for three performance measurement instruments that are being developed during the first Compact period?
- Reward Funding is only available to universities that meet their Performance Funding targets for the two participation and social inclusion indicators (for students from low socioeconomic backgrounds and those from an other underrepresented group).
- Universities will receive Facilitation Funding in 2011-2013 for agreeing performance targets to participate in the development of performance measures and establish baseline performance.
- Three performance measurement instruments are being developed during the first Compact period. These are: a new University Experience Survey (UES), an Australian version of the Collegiate Learning Assessment (CLA) and a strengthened Australian Graduate Survey (AGS) (incorporating the Course Experience Questionnaire).
- Results for AGS will be published on MyUniversity from 2012, A baseline for CLA and UES will be established using 2013 data with results to be published on MyUniversity from 2013.
- Universities will not be required to meet quantitative performance targets against indicators that use these measures to receive Reward Funding.
More information on the development of these indicators was released by the Government as part of the Advancing Quality in Higher Education initiative.
3.5 Will there be an opportunity for consultation on the development of the new performance measurement instruments?
- DEEWR will work closely with higher education stakeholders, including universities, business and students on all aspects of the Advancing Quality in Higher Education initiative.
- In addition to focused consultation and engagement on specific instruments, a reference group has been established to provide advice on the overall implementation of the suite of performance measurement instruments including the University Experience Survey, the Collegiate Learning Assessment, the composite Teaching Quality Indicator and the Australian Graduate Survey.
- The Reference Group is made up of representatives from the higher education sector, business and student groups, who have been selected by the Government in consultation with Universities Australia.
- Roundtable discussions will also be held early in 2012.
3.6 What scope is there for universities to negotiate Performance Funding arrangements that are consistent with their own mission and goals?
- Reward Funding is based on a small number of performance targets designed to encourage universities to improve outcomes for students and to achieve national participation objectives.
- Universities will continue to manage their own performance consistent with their distinctive mission and goals.
- Reward Funding arrangements provide scope for negotiation of use of annual or averaged data and performance targets for other underrepresented groups.
3.7 Will Reward Funding impinge on university autonomy?
- Reward Funding has been designed to encourage universities to improve outcomes for students and to achieve national quality, participation and attainment objectives. Targets are at university level rather than discipline level. Universities will manage their own internal performance across disciplines to achieve university-wide targets.
- Reward Funding arrangements provide scope for negotiation of use of annual or averaged data and performance targets for other underrepresented groups.
- Universities are free to spend their Reward Funding payments as they choose.
3.8 Will universities be required to agree performance targets beyond the Compact period (2011-13)?
- Universities will not be required to agree performance targets outside of the 2011-13 Compact period.
3.9 Why will the Government not proceed with the Composite Teaching Quality Indicator?
- Universities have made a reasonable case for measuring performance using output rather than input measures.
- Consultation with universities demonstrated it was unlikely that agreement could readily be reached regarding what elements appropriately constitute a composite teaching quality indicator.
- DEEWR will continue to publish partial indicators of teaching quality that are already available such as student staff ratios and the qualification levels of staff, noting that the method of calculating the student-staff ratio will be reviewed by the Department in response to concerns from universities about its publication on the MyUniversity website.
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