Australian universities’ haphazard governance could stem from the trivial consequences many face for misbehaviour, with councillors bearing far less liability than their counterparts in tiny community organisations, an inquiry has heard.
A new analysis has found that parents’ committees in neighbourhood preschools can be exposed to much greater penalties, if things go wrong, than governing bodies at universities with perhaps 300 times the students and 3,000 times the budget.
Preschool committee members can incur criminal prosecution if they fail to disclose “material personal interests”. They can also be held liable for debts if they obtain pecuniary benefit by manipulating the association.
They can attract fines of up to A$3,200 (?1,490) for not preparing statements of accounts or maintaining adequate records for seven years. Denying auditors access to the records could trigger fines of A$8,000 or six months’ imprisonment, or both.
By comparison, university council members who fail to “act honestly and for a proper purpose” incur no automatic consequences. They can be kicked off the council, but only through a two-thirds majority vote – in which they themselves cast votes – and can be reappointed afterwards.
University council members, unlike their preschool equivalents, have immunity from liability for their honest mistakes. Their reporting obligations are also far less onerous, requiring accountability to the responsible minister but with minimal prescription of what to report, and no penalties for non-compliance.
The analysis is based on a comparison of the (UC) Act and the Australian Capital Territory (ACT) , which would govern the operations of an incorporated preschool with 40 children.
UC law lecturer Andrew Henderson contrasted the two pieces of legislation in a submission to the Senate Education and Employment Committee’s inquiry into university governance. He said he had done so in a personal capacity, not as a UC representative, and that his institution was not necessarily unique. “State and territory legislation governing the administration of universities in other jurisdictions reveals similar issues,” his submission says.
Henderson conceded that universities, unlike preschools, were also responsible to the higher education regulator the Tertiary Education and Quality Standards Agency (Teqsa) – but not on some of the core governance issues covered by state and territory legislation. “Teqsa’s remit does extend to certain aspects of risk management and other functions, but only to the extent that it affects the quality of teaching,” his submission says.
The analysis found that the “objects” in UC’s act would not technically preclude its council from establishing a defence industry research centre in partnership with a foreign state. The preschool, by comparison, could only change its objectives if three-quarters of the committee agreed to a “special resolution” tabled with 21 days’ notice.
“It seems remarkable that a group of parents of young children at a small Canberra preschool could be subject to a more detailed territory regime, backed by criminal offences and provisions making them personally liable, than the council of a multimillion educational institution with thousands of students,” the submission says.
Henderson said his contribution had been motivated more out of concern for “confused” local volunteers than dissatisfaction with university governance. He said parents who joined community organisation committees, often “because nobody else wants to do it”, were completely unprepared for the “burdens” and lacked access to legal advice.
He said most jurisdictions, rather than enacting multiple laws, created legislation “that covers as many organisations as they possibly can” – which meant tiny preschools were subject to the same acts covering far richer entities. “It has some unintended consequences, one of which is that the six mums and dads…sitting on the tiny children’s chairs in a preschool at seven o’clock on a Thursday night are captured by the same thing.”
Universities, which are covered by individually tailored acts, avoid legislation designed for completely different organisations. But they could borrow from preschools, Henderson’s submission suggests. Regulatory regimes applicable to community organisations “might be extended to apply in a comparable way to universities”, it says.
The Senate committee is due to report on 1 August, if it opts to resume its university governance inquiry following the 3 May federal election. Committee chair Tony Sheldon convened the inquiry in January, citing a lack of “consequences or accountability” for the “continued governance scandals” in the sector.
ACT chief minister Andrew Barr, whose portfolio responsibilities include UC, said his government supported the rival Expert Council on University Governance established a few days before the Senate inquiry. In his own submission to the inquiry, Barr said his government would review the expert council’s recommendations “later this year” and “assess whether the UC Act needs harmonising amendments”.
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