Barnaby Joyce declines to criticise University of New England as it looks to slash up to 210 jobs in his electorate

Barnaby Joyce has declined to criticise the University of New England over its handling of job cuts in his electorate and sided with education minister, Dan Tehan, over regional universities’ concerns with aspects of higher education reforms.

The member for New England told Guardian Australia regional universities stand to gain a “much better funding stream” under the proposed changes and backed UNE vice-chancellor, Brigid Heywood, to “do her job” by identifying savings, and promised not to tell her what to do.

On Wednesday UNE announced a plan to cut annual costs by $20m, with staff costs to be cut by about 12% and possibly as high as 15% – prompting concerns that up to 210 of the university’s 1,400 staff could lose their jobs.

Universities including Monash and the University of New South Wales have already announced job cuts triggered by a total projected $16bn loss of revenue in the university sector due to Covid-19.

Heywood told Guardian Australia its $25m shortfall in 2020 was also attributable to drought and bushfires, with many rural students needing to “step away because of those environmental challenges” although domestic student numbers are now improving again.

Joyce said the $25m shortfall was a “fraction of what they get paid” by the federal government, which has guaranteed its $18bn contribution to universities, even if student numbers fall.

“No business has carte blanche [allowing them] not to manage costs,” he said.

“The VC and her management team have decided this is the path they want to go down – they’re responsible for managing their business, not the federal government.”

In June, Tehan announced a university reform package reducing the overall government contribution to degrees from 58% to 52% and increasing fees for some courses to pay for 39,000 extra university places.

Despite significant benefits for regional universities – including growth in places of 3.5% – the package has nevertheless caused concern that a $5,000 payment for regional students will create a perverse incentive to move to the city for university.

The regional education minister, Andrew Gee, has said the concerns – including UNE’s belief that increasing fees for social work, behavioural studies and psychology courses may have adverse impacts on the mental health workforce – “are important and should be addressed”.

But Joyce brushed off concerns about the relocation allowance, arguing prospective students “go where they’re going to get the best degree”, choosing the course that best aligns with their desired career path, lifestyle and “where they have work”.

Asked about whether regional mental health workforces will be hit by fee increases, Joyce said that “in any funding announcement, especially as we’re heading towards $1tn of gross debt, there’s going to be consequences”.

“You can’t give as much to everyone as you’d like on every issue.

“If we go down that path, you’ll run out of access to credit, and there’ll be no money to give to universities at all.”

Joyce noted the package gives regional universities “growth in funding above inflation” and a “much better funding stream”, particularly for courses such as nursing and science.

In fact, science degrees are set to get less money from both students and the government; while the proposed increased government contribution to nursing degrees is not large enough to offset fee cuts.

Heywood is also upbeat about the university reform package, saying it presents “real opportunities” to help expand the Tamworth campus and get benefits for participation with business in Armidale through the $900m industry linkage fund. She said growth in places of 3.5% “absolutely fits our agenda”.