Starting from 1 July 2024, Victorian non-profit private schools with an income per student exceeding $15,000 were subject to a 4.86% payroll tax.
Collectively, these schools would pay the Victorian government an estimated $101.8 million in 2025.
According to analysis by The Age, the payroll tax charge has driven an annual tuition increase of 6.5% on average across these schools, well above the inflation rate of 2.8%.
The question must be asked: why aren’t Australia’s universities also subject to the payroll tax?
Like independent schools, Australia’s universities supposedly operate on a not-for-profit basis.
Yet, our universities have transformed into greedy, revenue-driven enterprises that seek to enrol as many full-fee-paying international students as possible.
Data released in May 2023 revealed that over half of Victoria’s vice chancellors earned more than $1 million in annual salaries.
Six of the eight vice chancellors also received hefty pay increases.
Separate data released in November by the Guardian also revealed that more than 300 Australian university executives earn more than state premiers.
Meanwhile, Australia’s million-dollar university vice-chancellors and self-centered administrators treat students like cattle, crowding them into overcrowded classrooms and teaching them generic, cookie-cutter courses.
Domestic students have also been required to help non-English speaking students complete their courses through group projects.
Local students are frequently paired with international students, resulting in domestic students performing the majority of the work, essentially serving as unpaid tutors and cross-subsidising international students’ grades.
In essence, universities and private colleges are privatising the benefits of record-high student enrolments, while other Australians, particularly renters seeking homes, bear the cost.
The corporatisation of universities has gotten so bad that National Tertiary Education Union (NTEU) research discovered that corporate heavyweights are co-opting university governing councils, resulting in a “circular system of patronage” that keeps employees underpaid while executives are overpaid.
According to an NTEU analysis of 545 council posts at 37 universities, representatives of the Big Four accountancy firms and industry groupings control up to half of the positions, with some governing councils comprising more finance or mining executives than current academic practitioners.
Meanwhile, the surge in major corporate nominations to university boards and executive pay has been accompanied with more precarious work, wage theft, and poor governance.
According to NTEU national president Alison Barnes, “public universities are prolific wage thieves” and that wage theft “has become baked into universities’ business models”.
Her comments came after the Fair Work Ombudsman (FWO) ordered Sydney University to reimburse over 15,000 workers $23 million in stolen wages, and the university apologised for nine years of wage theft.
Fair Work Ombudsman Anna Booth said the university has admitted its governance payments and violations, as well as self-reported its payroll problems, while Barnes believes an immediate federal parliamentary inquiry into the ‘broken’ university governance mechanism is necessary.
The FWO also ordered Melbourne University to compensate 25,000 employees $72 million in back pay for wage theft.
“Systemic failures in compliance, oversight and governance processes were key causes of the underpayments”, FWO Anna Booth said.
Operating low-quality student visa mills with high throughput was never in the national interest.
Nonetheless, Australia has established a system that rewards university executives with substantial incomes for successfully transforming their institutions into low-quality, high-volume immigration mills.
Universities, not taxpayers, are ‘clipping the ticket’ and reaping significant economic benefits from Australia’s immigration system through student fees.
So, why aren’t Australia’s universities required to pay Victorian payroll tax, similar to independent schools?
