Mr Birmingham was at the University of Sydney to adjudicate a debate when protests broke out.
Footage has surfaced showing police forcibly removing about 30 students from the university's Fisher Library.
Students were protesting policy changes to higher education funding and loan repayments.
"They pushed us up two sets of stairs, utilised headlocks, and at least two students were knocked to the ground," student Cameron Caccamo told AAP.
"(It was) really excessive force given that we weren't violent."
Mr Birmingham told the ABC on Wednesday that policy of deregulating the sector was still on the table.
"We will make sure that Australians understand what we are doing, the reasons why we're doing it and importantly that our universities do need to be able to differentiate between each other, to innovate on the world stage," he said.
"And that, of course, does provide or require a certain degree of latitude for them in terms of how they structure their source course and how they finance those courses to some extent."
Federal Finance Minister Mathias Cormann told the Seven Network on Thursday that funding of the university sector needs to be sustainable for the future.
"There is an exposure here which is the result of two decisions of the previous government," Mr Cormann said.
"Namely they expanded student loans to the vocational education and training sector.
"They've also introduced what is called a demand driven program into the higher education sector more broadly.
"So we've been grappling with these issues and have been focusing on how we can make sure that what we do in this space, we do across government , is affordable and sustainable for the future."
An expert panel is calling for public feedback on proposals for University entry requirements to be more clearly articulated, clarity around ATAR scores and clear information about all entry pathways.
Mr Birmingham said he was keen to see universities provide more transparency about entry requirements.
