University missions and financial incentives: the response of universities to Australia’s Job-ready Graduates policy

Abstract Funding incentives are widely used to steer universities towards meeting policy objectives, but they do not always produce the expected outcomes. The headline policy of Australia’s Job-ready Graduates (JRG) university policy was the change to student fees, lower for priority ‘job ready’ disciplines and higher for others, to steer student course choices towards national priorities. JRG also significantly changed funding arrangements from a university perspective, in ways that sometimes contradicted the student incentives. How universities responded to JRG incentives and constraints remains unexplored. Drawing upon the critical lenses of policy enactment and policy instrumentation, this study examines university responses to the JRG policy. Semi-structured interviews were conducted with vice-chancellors and other senior staff at five universities to explore how institutional actors interpreted and negotiated the JRG policy within broader socio-political and institutional contexts. Three key findings are identified. First, earning a maximum university-level grant amount under JRG was widely (re)interpreted as a minimum, which contributed to enrolling additional students without a tuition subsidy. University missions were also a factor in this practice. Second, universities were usually, although not always, responsive to student demand, even when the financial incentives were weak. Third, mission factors, market competition and the perceived need to fully utilise institutional maximum grants led to postgraduate coursework places being offered on a subsidised rather than a market-fee basis.