Member for Western Victoria James Purcell says Federation University would take over Warrnambool’s Deakin campus for a price tag of $30 million.
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He is calling on Wannon MP Dan Tehan to secure $15 million in federal funding to assist with the switch of education providers.
Mr Purcell told Parliament on Thursday the Ballarat-based Federation University was willing to take on the Warrnambool campus but he estimated it would cost $30 million to bring it to profitability.
"Deakin has indicated its willingness to pay $15 million to discharge its commitments to current students,” Mr Purcell said.
“Now we need a rescue package from the Federal Education Minister (Simon Birmingham) to keep our campus running.
“Everyone else has done their bit.
“At a state level we have been actively working to keep a tertiary presence in Warrnambool and there is still a great deal more for us to do - there will be a substantial amount of work to support a new institution in Warrnambool and help facilitate a sustainable model.
"Now it's time for the federal government to step up to the plate and contribute the cash required to maintain a tertiary institution in Warrnambool."
Mr Tehan said he was working closely with a community advisory committee, which was formed on Wednesday.
“I would ask that everyone else work with them to make sure that we get the best outcome for the south-west,” he said.
“Obviously we are all working to ensure that the university campus continues to service the south-west and it is based in Warrnambool.
“I am sure, as long as we stick together, we will get the right outcome for the community.
“One of the things we have to find out is what our options are and what they entail, so we can then work through them.
“We need to continue to talk to Deakin and we need to see if Federation University are interested, and if they are, we need to have a serious dialogue with them.”
Federation University would not respond to Mr Purcell’s comments.