The Higher Education Performance Funding to be introduced in 2011 is a key development in the policy and financing framework for Australian Higher Education. The performance funding framework, along with mission-based compacts, the new equity initiatives, the relaxing of caps on Commonwealth supported places and the establishment of the Tertiary Education Quality and Standards Agency (TEQSA) will radically change the drivers of higher education in Australia into the future. It is important these measures are implemented within a well considered policy framework and a strong understanding of the overall impacts. The Government's consultations on performance funding and low-SES participation provide opportunities for important inputs to be made. This response outlines the broader policy implications of the performance funding initiative, the Group of Eight's (Go8) approach to the Government's objectives, explores general policy issues which need further consideration, identifies specific concerns with the proposed measures, and suggests a way forward in partnership. (Contains 8 footnotes.)