The Coalition will double university fees for some future arts students, and also raise them for commerce and law, to fund an expansion of 39,000 places and cheaper degrees for those who study in-demand courses such as teaching, nursing, maths, science and engineering.
The education minister, Dan Tehan, will announce the policy to create more “job-ready graduates” at the National Press Club on Friday – emphatically rejecting comparisons to unsuccessful attempts to deregulate fees in the 2014 budget despite more than doubling the future cost of an arts degree.
As universities suffer a massive drop-off in revenue from the absence of international students they are hoping to boost domestic enrolments, but face an effective handbrake in the cap on commonwealth grants funding.
In excerpts of the speech, seen by Guardian Australia, Tehan promises an additional 39,000 university places by 2023 and 100,000 places by 2030, and that commonwealth grants will maintain their real value by being indexed to inflation.
Tehan says the student contribution for law and commerce units will increase by 28% and for the humanities by 113%.
The student contribution for a three-year humanities degree would jump from up to $20,400 to $43,500; while law and commerce degrees could increase from $34,000 to $43,500.
The student contribution will be reduced:
By 62% for those studying agriculture and maths – giving savings of up to $18,000 across the life of a degree.
By 46% for those studying teaching, nursing, clinical psychology, English and languages, savings of up to $9,300.
By 20% for those studying science, health, architecture, environmental science, IT and engineering, or savings of up to $6,900.
The policy effectively reduces the overall government contribution to degrees from 58% to 52%, with student contributions lifting from 42% to 48% to pay for more places without extra government funding.
Tehan says it is expected that 60% of students will “see a reduction or no change in their student contribution” as a result of the changes. Medicine, dental and veterinary science students will be among those who face no fee changes.
“Importantly, no current student will be worse off,” Tehan says. “No current student will pay an increased student contribution. Their fee contributions will be grand-fathered.”
Tehan argues the changes “address the misalignment between the cost of teaching a degree and the revenue that universities receive” by ensuring that the student and commonwealth contribution together cover the full cost.
Tehan notes the changes “are based at a unit level not a degree level” meaning that humanities students can avoid some of the cost by choosing electives from other disciplines such as maths, English, science and IT.
“We are encouraging students to embrace diversity and not think about their education as a siloed degree,” Tehan’s speech says.
“So if you want to study history, also think about studying English. If you want to study philosophy, also think about studying a language. If you want to study law, also think about studying IT.”
Tehan argues the government needs to address the increased demand from people turning to higher education during the Covid-19 contraction, and with those born in the baby-boom of the early 2000s about to start university.
Demand for university places from graduating year 12 students is set to increase from 133,000 in 2019 to 154,000 in 2021.
Tehan notes that just four industries are expected to account for 62% of employment growth in the next five years: healthcare, science and technology, education and construction.
His speech says students still retain choice and can choose a cheaper option “in areas where there is expected growth in job opportunities” – in what he describes as a “win-win” for students.
“It’s common sense. If Australia needs more educators, more health professionals and more engineers then we should incentivise students to pursue those careers.
“This does not mean fee deregulation. This does not mean $100,000 degrees.”
In addition to lifting graduate numbers in these areas, Tehan nominates attainment for students in regional Australia and strengthening “relationships with business” as priorities.
The government is yet to set out how it plans to implement the recommendations of the Napthine review into regional universities.
The Regional Universities Network has submitted to the Covid-19 Senate committee that the government could help it do so by doubling the loading for regional universities from $70m to $140m.
The Morrison government has guaranteed its $18bn contribution to universities, but refused to kick in extra while also making a series of changes effectively excluding public universities from the jobkeeper wage subsidy scheme.
From July, universities will begin pilots for international students to return to Australia with the hope of increasing enrolments in time for 2021, to avoid an estimated $16bn black hole from Covid-19.
• The figures in the table accompanying this article were amended on 22 June 2020, after the education department corrected the numbers in its original release.