The 2026–27 federal budget has left Australia's higher education sector in a state of frustration and renewed advocacy. Despite widespread recognition that the Job-Ready Graduates (JRG) package, introduced in 2021, has not delivered on its promises, the latest budget offered no meaningful overhaul. Instead, it has prompted fresh calls from universities, peak bodies, students and academics for urgent reform to restore fairness, reduce student debt and stabilise institutional funding.
Why the JRG Package Remains Under Fire
Introduced as part of the Higher Education Support Amendment (Job-ready Graduates and Supporting Measures) Act, the JRG package restructured Commonwealth funding for university places. It aimed to align student contributions with perceived job outcomes by lowering fees in priority fields such as nursing, teaching and engineering while dramatically increasing them in humanities, arts and social sciences. The result has been the opposite of what was intended: student contributions in some fields have climbed to $17,399 per year, pushing total debt for a three-year arts degree toward $50,000 in some cases.
Universities Australia has been unequivocal. Its CEO Luke Sheehy stated that the budget “misses the opportunity to fix the Job-ready Graduates Package—a failed, broken system that continues to push up costs for students while stripping billions out of university funding.” The organisation estimates the package has removed around $4 billion from the sector since 2021, with real funding per student frozen or declining in many disciplines.
Stakeholder Perspectives Across the Sector
Peak bodies representing humanities, social sciences and creative arts have been particularly vocal. The Australian Academy of the Humanities and the Australasian Council of Deans of Arts, Social Sciences and Humanities (DASSH) argue that the fee structure distorts student choice and undermines the broad education that employers value. They note that many graduates in “high-fee” fields still enter high-demand roles in government, education and community services.
Student groups, including the National Union of Students, have organised protests highlighting intergenerational inequality. With living costs rising and rental stress acute in university cities, the prospect of $50,000 degrees has galvanised campus activism. The Greens’ Higher Education Support Amendment (Reverse Job-Ready Graduates Fee Hikes and End 50k Arts Degrees) Bill 2025, currently before a Senate inquiry, proposes returning most student contributions to pre-JRG levels, capping arts fees at $8,164 annually.
University leaders from the Group of Eight and Innovative Research Universities have echoed these concerns, warning that continued underfunding threatens research capacity, regional campuses and equity initiatives. Submissions to the Senate inquiry emphasise that reform must address both student contributions and the underlying Commonwealth Grant Scheme funding clusters that determine what universities receive per place.
Impacts on Students, Graduates and Institutions
The package has produced a range of unintended consequences. Students in lower-fee priority fields have seen modest savings, but many report that the overall cost of living has offset any gains. Graduates carrying higher debts face longer repayment periods under the Higher Education Loan Program (HELP), with indexation continuing to push balances upward even when wages stagnate.
Universities have responded by cutting subjects, reducing tutorial hours and increasing casualisation. Regional and outer-metropolitan institutions, already operating on thin margins, have been hit hardest. The absence of new places or additional funding in the 2026 budget has compounded these pressures, leaving many administrators planning further efficiencies rather than expansion.
Photo by Sasun Bughdaryan on Unsplash
Political and Policy Context
The Albanese government has repeatedly signalled that it is awaiting the outcomes of the Universities Accord process before committing to major structural change. However, the Accord’s interim recommendations included urgent action on JRG, and the budget’s silence has been interpreted by many as a deferral. Crossbench pressure, particularly from the Greens and some independents, has kept the issue on the parliamentary agenda.
The Senate inquiry into the Reverse JRG bill provides a formal avenue for evidence. Submissions from Universities Australia, the Go8, DASSH and student organisations have all called for a return to more balanced fee structures while protecting the additional places and regional loadings introduced under JRG.
Proposed Pathways to Reform
Analysts and peak bodies have outlined several practical options. One approach involves recalibrating student contributions so that no field exceeds the pre-2021 maximum, funded by modest increases in the Commonwealth contribution for high-cost disciplines. Another focuses on restoring the funding clusters that determine institutional revenue, ensuring universities are not penalised for offering broad-based education.
Some commentators advocate a hybrid model that retains incentives for priority fields while introducing needs-based scholarships or debt relief for graduates entering lower-paid but socially valuable roles. The key message across submissions is that piecemeal adjustments are no longer sufficient; a comprehensive rewrite of the JRG architecture is required.
International Comparisons and Lessons
Australia’s experience stands in contrast to systems in Canada, the United Kingdom and parts of Europe, where governments have moved to moderate fee differentials or provide greater income-contingent support. These jurisdictions have recognised that excessive variation in student contributions can deter participation in disciplines that deliver broad societal benefits, even if they do not always produce the highest private returns.
Looking Ahead: What the Sector Needs
With the next federal election approaching, higher education advocates are urging both major parties to commit to JRG reform in their platforms. The Australian Tertiary Education Commission, newly established, is expected to play a central role in advising on funding settings. Its early appointments and terms of reference will be closely watched.
For academics and administrators, the message is clear: without reform, the sector will continue to absorb the costs of a policy that has not achieved its stated goals. For students and prospective applicants, the uncertainty around fees and debt remains a significant barrier to participation.
Conclusion
The 2026 budget has crystallised a growing consensus that the Job-Ready Graduates package requires fundamental change. From peak bodies to student unions, the call is consistent: replace the current fee and funding model with one that is equitable, sustainable and aligned with the full range of graduate outcomes Australia needs. The coming months of Senate scrutiny and pre-election positioning will determine whether that consensus finally translates into legislative action.
