Universities don't need the option of pushing up course prices for students.
But they desperately want to know what the government has in store for them on alternatives for revenue.
"Is it necessary to deregulate (fees)? Well, no, of course it's not necessary to do it," Universities Australia chairman Barney Glover told the National Press Club on Wednesday.
"It depends on the investment governments are willing to make."
The peak body representing higher education institutions has lashed out at the Turnbull government for the lack of clarity about its plans for the sector.
The start of changes to university funding, including allowing institutions to set their own fees, has been delayed until 2017 as the government leaves the door open to tweaking its plans.
But Prof Glover says two years of uncertainty is taking its toll on the sector's ability to plan and allocate resources for students.
"It is difficult to imagine any other industry tolerating such policy instability."
Prof Glover says it's great the government is now talking about policy alternatives and at least consulting the sector.
But he's concerned that the original plan - which, besides deregulation, includes a 20 per cent cut to course funding - is still on the table.
The legislation has been twice rejected by parliament.
Education Minister Simon Birmingham is set to address the industry with a speech on Wednesday night but it's understood he won't make any major announcements.
Prof Glover would not reveal the contents of his discussions with Senator Birmingham but said the minister understood the political realities.
"I'm sure the minister is looking at what he believes is possible, in terms of significant change for the sector," Prof Glover said.
He also wants universities to get a bigger share of a $2.9 billion pie in tax breaks for research and development.
Businesses should be encouraged to team up with universities on research and innovation, he said.
