The blunt warning is made in the agency’s latest annual list of top global universities.

In its most pointed comments yet about the impact of the funding freeze, the respected agency said: “You can’t sustain world-class universities and research facilities with funding cuts”.

THE Global Rankings Editor Ellie Bothwell warned: “the national picture is a cause for concern, with many universities declining or remaining stagnant.”

“To excel, universities need strong investment … as funding cuts take hold … Australia’s universities could well face an uphill struggle in the coming years,” she said.

THE Editorial Director of Global Rankings Phil Baty said the latest rankings show traditional university powerhouses like Australia “are experiencing the effects of deepening cuts”.

“Maintaining current standards of excellence on those terms is unsustainable,” he said.

Universities Australia Chief Executive Catriona Jackson said the stark warning should prompt a Government rethink and reversal of the funding cuts.

“These ranking results confirm our world-class standing – but also show this is at risk unless those cuts are reversed,” she said.

“We’ve been warning for some time about the damage of funding cuts on Australia’s rankings.”

“Now, the Times Higher Ed have sounded the warning in the influential World University Rankings. That’s like Moody’s or S&P warning a Government about a downgrade to a national economy.”

“Funding cuts are bad for local and international students. They threaten quality.”

“International education is built on quality.”

“International students inject almost $32 billion into Australia’s economy each year and support 130,000 Australian jobs. They also bring Australia and the world closer together and build important diplomatic and personal ties.”

“Australia’s world-class universities need the backing of sustained investment or we risk falling behind international competitors.”