Australian Senate rejects bills that would deregulate university fees and cut state funding

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The Australian Senate on Tuesday rejected government legislation that would have cut public funding to universities but allowed campuses to raise student fees to make up the shortfall.

The close 33-to-31 Senate vote was another blow to Prime Minister Tony Abbott's bid to rein in Australia's burgeoning deficit in the final few days that Parliament will sit for the year. It came the same day as a prominent opinion poll showed that Abbot was becoming increasing unpopular 15 months after his convincing election victory.

The government had hoped to save 1.1 billion Australian dollars ($934 million) over three years from 2016 under the plan that included reducing government restrictions on how much universities can charge Australian students. Fee-paying foreign students, mostly from China and India, currently subsidize Australian students at the same universities, which are largely state-funded.

The most popular universities welcomed fee deregulation, but the opposition and key independent senators warned that the children of ordinary Australian families would be priced out of tertiary education.

An opinion poll by Sydney-based market researcher Newspoll published in The Australian newspaper on Tuesday showed Abbott's approval rating fell to 33 percent from 41 percent in September. The poll was based on a random, nationwide telephone survey of 1,164 voters on the weekend. It has a 3 percentage point margin of error.

Abbott on Tuesday blamed his government's poor polling on the unpopular work of reducing the budget deficit. The government's plan to return the budget to surplus in four years has been undermined by falling iron ore and coal prices that have wiped billions of dollars off forecast tax revenues.