Aiming to solidify Ballarat as a "university city", Federation University will look for more partnerships with industry to create more "job pipelines", as part of its next School of Mines masterplan.
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The state government has allocated $2.25 million to the $6.1 million project, which will complement the $9.5 previously committed for a new Centre of Business Excellence on Armstrong Street.
The new SMB plan will include new infrastructure, based on needs identified by major employers, as well as a commitment to new zero-emissions technology.
The plan will be developed over the next 12 months, according to vice-chancellor Professor Duncan Bentley.
"The SMB campus has a great history - 150 years ago, government and industry partnered to create one of the most prestigious mining schools in the world to drive the thriving gold rush," he said.
"Today, we're partnering with government, industry, and the community, to build an even richer seam of knowledge, skills and jobs for regional Victoria.
"As society transforms, as Ballarat transforms, we're seeing the skills and knowledge which are needed as a pipeline for all those industries which are coming into Ballarat, many establishing headquarters or precincts here.
"As we bring thousands more students into the centre of Ballarat with intentional timetabling into the new buildings, where they can connect right across our regions, it'll create a throbbing heart of the city, which will be vibrant and attractive for students (and) that will allow us to have critical mass to offer new programs - we're going through a reimagination at the moment."
The announcement comes as the university is hit by allegations its Bachelor of Arts program has been gutted - the National Tertiary and Education Union slammed "managerial incompetence" amid fears a third of staff will be lost.
In a statement earlier this month, the union said staff had endorsed a motion of no confidence in school management, and planned cuts will not improve the situation.
"Some staff members are wondering whether the university is genuinely committed to the longevity of the Arts program or whether this is all just designed to shift the bulk of teaching online. Students are tired of on-line learning and so are staff," Federation University NTEU branch president Dr Mathew Abbott said in a statement.
However, Professor Bentley said the university had to respond to the "sad reality" of the situation, adding he understood it was difficult.
"The issue we've got is we've seen a decline in student numbers over the last five years, it's been exacerbated to some degree in the changes to federal funding for Arts (degrees), but essentially we can't have 20 staff to a first-year intake of 29 students, in a program that is not in demand by employers or prospective students," he said.
"That's the sad reality we are facing, that's why investment from the state government today, in the programs of the future we can co-create with employers, to make sure we can drive demand, is important.
"A different form of digital arts will become critically important in the coming years, so we need to change the way we do things and respond to that once the demand exists."
The masterplan will include new PhD partnerships with industry, he added, to provide more opportunities and incentives for students in Ballarat.
"We just recently launched the Bachelor of Cognitive Enterprise with IBM, designed to give them the skills pipelines for the jobs which are coming up and developing in the IT sector," he said.
"The reality is, we've got to be thinking of what are the jobs which we haven't even imagined, which are going to develop, and they'll develop in Ballarat in the next decade.
"We'll co-create with industry and the community to develop a curriculum that will drive jobs and growth in Ballarat."
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Wendouree MP Juliana Addison said the masterplan would be another "piece of the jigsaw puzzle" in transforming Ballarat's CBD, including GovHub, train line and station upgrades, and promised parking expansions.
"We know that strong universities lead to strong, educated communities, they can be incredibly transformative," she said.
"We've got a fantastic school sector - I know that, being a former schoolteacher - we have some of the best schools in Victoria in Ballarat, and I'd now like our students to stay in Ballarat and get their higher education training right here."
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