ATEC, Asia capability & the case for a national approach to higher education

The establishment of the Australian Tertiary Education Commission (ATEC) marks what Labor MP Tim Watts describes as a “singular opportunity for Australia’s future” and a chance to rebuild one of the nation’s most critical yet fragile assets: Asia capability.

As evidenced in the Australian Academy of the Humanities’ 2023 China Knowledge Capability Report, enrolments in Asian languages and China Studies programs at Australian universities have been declining for more than two decades.

Speaking in support of the Universities Accord (Australian Tertiary Education Commission) Bill 2025, Watts said the creation of ATEC was the most important of all of the recommendations of the Higher Education Accord Report.

Understanding our region

Australia’s ability to understand and engage with Asia is fundamental to its security and prosperity said Labor MP, The Hon Tim Watts, during the second reading debate on the Universities Accord (Australian Tertiary Education Commission) Bill 2025.

“More than ever before, Australia’s security and our prosperity depend on our ability to be effective in our own region,” he said. “Asia capability — the mix of cultural understanding, language faculties and regional experiences needed to be effective in Asia — underpins all spheres of our national endeavour, our statecraft, our industry, our defence and our civil society.”

Australia, he argued, cannot outsource that knowledge.

“Australia cannot rely on other countries to produce the analysis that we need, to share our research priorities or to develop the relationships that we need to serve our interests. We need the sovereign capability to do these things for ourselves in our own region.”

“The ATEC, by taking a systems approach rather than an individual institutions approach, will ensure that Australian universities can deliver the vital sovereign capabilities that Australia will need in the coming decades,” he said.

A shrinking pipeline of Asia expertise

The infrastructure that once produced that capability is eroding.

“Universities play a vital role in building Australia’s Asia capability,” said Watts. “It’s where students develop expertise in the countries of our region, deepening their focus during honours, masters and PhD programs. I’ve met countless leaders—Australian ambassadors to countries in our region, business leaders investing in trading in our region and strategic thinkers aiming to understand our region—who all developed their Asia capability while at university.”

“Currently, we benefit from the deep Asia capability within a small number of individuals at the top of our Public Service, universities, civil society and private sector. These individuals are the product of investments made decades ago,” Watts said of Australia’s current Asia-capable leaders. “Unfortunately, the structures and institutions that educated this generation of leaders, increasingly, no longer exist.”

Between 2004 and 2022, enrolments in South-East Asian languages fell by 75 per cent. Only 12 universities now teach Indonesian, down from 22 in the 1990s, and of more than one million domestic university students in 2023, “barely 500 students were enrolled in a single subject of Bahasa Indonesia nationwide”.

A national capability gap

These trends reflect what has been identified as a national capability gap. The Academy’s China Knowledge Capability Report (funded by the National Foundation for Australia-China Relations) found that only 17 Australians completed honours in Chinese studies with language between 2017 and 2021 — no more than five graduates a year.

The report underscores that Asia capability is not only an academic concern, but a strategic one. Without intervention, Watts warned, “…the pipeline of future Asia-capable leaders is breaking down in Australia.”

In submissions to the Accord, the Academy has argued that ATEC should formally recognise Asia capability as a national priority, monitor gaps and opportunities, and set benchmarks through mission-based compacts — positioning the commission as a central mechanism for rebuilding capacity.  Other humanities disciplines needed to underpin sovereign cultural capabilities (i.e. the subjects that train students to understand culture, context and creative thinking) should equally come to the attention of ATEC, like languages and linguistics, history, English, philosophy, Indigenous studies, creative arts and literature studies.

Structural pressures on language & area studies

The decline in Asia-focused programs has multiple causes. Demand for Asian language study has dropped sharply, while teaching costs have risen. Universities have struggled to sustain programs in a demand-driven funding model, and language courses are often among the most vulnerable.

Watts noted, “Many Asian language and area studies are kept on the whim of university leaders.”

Academy Fellows Professor Melissa Crouch FAHA, an expert in Indonesia and legal scholar, and Professor Greg Hainge FAHA, Chair of the Academy of the Humanities’ Committee on Languages, were referenced in Watts’ speech.

“In Australia, Asian studies and the study of Asia across the various disciplines … has long relied upon the institutional support of its leaders — its vice-chancellors, deputy vice-chancellors, deans, heads of school, and so forth,” said Professor Crouch.

“These offerings also rely on secure structural foundations — Asian studies degrees, a suite of Asian language offerings, independent research centres, and the study of Asia embedded across a range of disciplines, from law to business.”

Professor Greg Hainge FAHA said, “… A coordinated national system is critical. I think we’re at an ideal moment with ATEC coming online. This is a body that has stood up to talk about arrangements with universities that extend beyond the life of a single government.”

Embedding Asia Capability as a national priority

The stakes extend well beyond academia.

“Australia needs to be able to understand and engage with countries in our own region through our own perspective, and we can’t rely on other countries to do this for us,” said Watts. “Unless we choose to make developing Asia capability a priority as a nation, we are choosing to leave our future security and prosperity to be determined by others.”

ATEC provides the institutional mechanism to avoid that outcome. By embedding Asia capability within long-term compacts, strategic advice and system-level oversight, the Commission can help ensure that universities deliver not only skills for the labour market, but sovereign knowledge for the nation.

In that sense, the reform is about more than governance. It is about whether Australia chooses to invest, deliberately and collectively, in the expertise needed to navigate its own region — and to shape its own future.

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