policy & reform
JEANNIE REA PRESIDENT OF THE NATIONAL TERTIARY EDUCATION UNION
The NTEU analysed the impact that the deregulation of fees might have on domestic students and found that the claims of $ 100,000 degrees were not fanciful. A consensus is growing that these exorbitant costs and debts will deter people from undertaking higher education just as jobs increasingly demand degrees.
Starting with the Budget announcement of a 20 per cent reduction in the level of government funding for a commonwealth supported place( CSP). Then add the $ 1 in every $ 5 of increased students fees that universities collect being quarantined to fund so-called Commonwealth scholarships. Together, they mean universities would need to increase fees by one-third just to maintain the current level of funding. However, uncapping of HECS across the discipline clusters will mean further large student contributions in many courses, increasing the cost of, for example, a social science degree by more than 70 per cent and sending engineering, law, medicine and probably some commerce and management degrees above the $ 100,000 mark.
The cost of an accountancy degree could more than double, from $ 30,000 to $ 75,000. When the proposed market-determined interest rate is added, an accountant could be paying another $ 24,000 in interest over 23 years, taking the cost of the degree to $ 99,000. However, for the graduate who has career breaks – predominantly women having children – the total repayments could blow out to $ 120,000, and she could still be paying off her debt in her 50s as her children want to go to university.
Students will still be able to pay upfront and avoid the interest, but only the well-off could manage these big fees.
Only some universities will charge higher fees. Others may start undercutting one another and the relative equity across our higher education system will rapidly deteriorate as some students pay for better resourced universities, but many institutions struggle with service and staff cuts. This will be like the US system, which minister Pyne may favour but is internationally recognised as the most divisive and inequitable system.
SENATOR LEE RHIANNON GREENS SPOKESPERSON FOR HIGHER EDUCATION
Fee deregulation is code for increasing student costs. Allowing the highest-ranked universities in Australia to jack up their fees so the government can subsidise private colleges is radical and regressive, particularly in the face of $ 2.3 billion in cuts to university funding.
This, in addition to HECS loans being charged at a real interest rate of up to 6 per cent, will result in individuals’ debt continuing to grow over the course of their working lives, at a rate higher than wage increases.
Women, people from disadvantaged backgrounds, low-income earners and the 1.8 million Australians who have HECS debt are set to be severely affected. In some cases, they will unable to pay back their loan before they retire. This is a bid to Americanise our higher education system, but what the Coalition is planning will hit students in Australia even harder than what those in the US endure.
In the US, students graduate with an average US $ 29,400($ 31,800) in debt. Under the government’ s radical reforms, students in Australia could graduate with debt twice as high.
In less than eight months of being in office, Pyne has introduced sexist, cruel and brutal changes to education that will benefit the rich and private education providers.
The Greens believe the government’ s plans for our universities are unfair. Students shouldn’ t be saddled with huge debts and interest bills just to get an education. We will fight these changes.
PROFESSOR GLYN DAVIS VICE-CHANCELLOR OF THE UNIVERSITY OF MELBOURNE
The cuts for universities in 2014 compound the large reductions under then-trade minister Craig Emerson in 2012 and 2013.
This is the essential context for understanding the public argument about student fees. Much public funding will probably be removed from tertiary education. Universities are invited to make up this gap through higher fees. Initial analysis shows the gap is momentous indeed – fees would need to rise by 45 per cent to make up lost funding in social science disciplines, by 54 per cent in science, and by 61 per cent in engineering. Students would get nothing new for this increased debt. The requirement for additional equity scholarships applies only after price rises mitigate cuts to the Commonwealth Grant Scheme.
Some‘ known unknowns’ remain about the Budget initiatives, including proposals for a student contribution to doctoral training, and a pending review of postgraduate Commonwealth supported places.
The university has established a Funding Reference Group to model the impact of policy scenarios flowing from the Budget. The group will be led by deputy provost professor Susan Elliott, and is tasked with developing recommendations for wider consultation with the university community.
At this stage, it is impossible to know what aspects of the Budget may survive the parliamentary process. Some funding cuts are included in appropriation bills, and so are likely to pass. Yet the majority of the higher education funding initiatives, including changes to the student contribution, involve legislative amendment to the Higher Education Support Act 2003. This requires the support of the Senate.
We should urge the government to moderate the interest rate imposed on student debt and reconsider deep cuts caused by the change in funding clusters.
Everyone on campus – student and staff member alike – understands we are now entering an unprecedented era in higher education. There are challenging issues involved in setting fees that cover the real costs of education, yet minimise debt levels for the next generation.
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