Extract from The Guardian
Department secretary tells senators that negative commentary on funding cuts might deter potential students
- Daniel Hurst, political correspondent
Senior federal education officials are concerned that the debate
about big increases to university fees will deter students from poorer
backgrounds from enrolling.
As the budget reforms to higher education were scrutinised in Senate estimates on Thursday, Department of Education secretary, Lisa Paul, said she “worried for the sake of students” that some of the dramatic public commentary on the funding cuts could deter people from considering further education.
“What worries us in particular is that sometimes these things are being presented to say that fewer disadvantaged students will participate,” she told senators, referring to modelling by the university sector focusing on the rising cost of degrees .
“What worries us is that some of this commentary becomes a disincentive effect in itself … whereas actually the fact is that if the reform package is looked at as a whole we estimate 80,000 more students will have access who have never had access before simply because of the expansion of demand-driven and students will be able to decide on the basis of price.”
The department disputed Universities Australia modelling showing future engineering students could face total loan payments of $113,000 over 25 years.
But the full impact of the government’s proposed higher education overhaul remains unclear, because deregulation will allow universities to set student fees as they see fit.
In other developments on Thursday, officials from the Tertiary Education Quality and Standards Agency (Teqsa) confirmed they were not consulted about the government’s planned expansion of funding to private providers despite the regulator’s key role in accreditation of operators.
And the University of Melbourne announced it would cut 540 jobs over the next 18 months in a bid to save $70m.
The Senate’s education committee focused on the financial impact of the reforms on students, in light of a range of estimates by the university sector, unions, political parties and academics.
The latest effort to predict the consequences came from Universities Australia, the sector’s peak body, which called for the government to rethink planned increases to the interest rate on Higher Education Loan Program (Help) debts and the 20% average reduction in the commonwealth contributions to degree costs from 2016.
The modelling suggested future engineering students may have to pay as much as $113,170 in total – which assumed additional fees of $23,923 on top of the existing fee level of $37,319, plus $51,928 in interest charges at a rate of 4%.
This scenario was based on a “medium fee” level under deregulation – halfway between a figure tied to the average international student fee ("high fee") and the minimum fees universities would have to charge to recoup the expected cut to the commonwealth contribution for domestic students ("low fee").
An education department associate secretary, Robert Griew, said he had concerns relating to the assumptions of fees that could occur once existing caps were removed.
He said the modelling was also based on 2016 graduate salaries “even though the students we're talking about will be finishing in 2019 at the very earliest”, which had the effect of deflating the salaries from which repayments would be made. The number of years to repay included the years of study.
Labor’s higher education spokesman, Kim Carr, suggested to the committee that Universities Australia would not “put out modelling willy nilly” and asked: “If the experts from a wide range of fields have such differences of opinion and find this matter so confusing what do students make of it; why wouldn't they be thoroughly confused by what's going on?”
Paul said that she was “concerned by the range of supposed models and so on and commentary that's out in the market”.
Universities Australia is understood to be confident its calculations are sound. It said it had no plans to change its modelling and would “provide further clarification to explain its conclusions”.
Legislation outlined the full details of the reforms is expected to be presented to parliament in the spring sittings, but officials said modelling about likely fees could not be produced because universities would make their own decisions.
The education minister, Christopher Pyne, released calculations on Wednesday indicating that if students left university with a debt of $30,000 to $40,000, they would have to pay back between $3 to $5 extra each week on average.
Griew said those figures were simply to reflect the impact on repayments of the changes given a hypothetical starting debt.
He said the fundamentals of the Help system still applied: the payment was rated to the income of students and repayment did not start until earning a good income. "As a result of that it's a very favourable loan including at the bond rate of indexation."
Paul urged senators to view the reforms as a total package, arguing the funding to private colleges and sub-bachelor courses would act to restrain fee increases and enhance access.
Griew said there were a number of different models around the world to achieve diversity, pointing to polytechnics in the UK and colleges in the US. “To say that one system is the best risks furious debate; there are huge strengths in the Australian system, but we are trapped in a very monochrome system,” Griew said.
“Our current funding system does more or less compel them all to be much the same in what they are driven to do rather than being able to diversify.”
The opposition leader, Bill Shorten, reaffirmed Labor’s decision to fight the changes. He said Pyne was employing “a dangerous community-dividing dog whistle" in arguing that 60% of Australians who did not go to university were subsidising the 40% who attended.
"Minister, education is a public investment in the future of our country; it is not solely a private benefit,” Shorten said.
As the budget reforms to higher education were scrutinised in Senate estimates on Thursday, Department of Education secretary, Lisa Paul, said she “worried for the sake of students” that some of the dramatic public commentary on the funding cuts could deter people from considering further education.
“What worries us in particular is that sometimes these things are being presented to say that fewer disadvantaged students will participate,” she told senators, referring to modelling by the university sector focusing on the rising cost of degrees .
“What worries us is that some of this commentary becomes a disincentive effect in itself … whereas actually the fact is that if the reform package is looked at as a whole we estimate 80,000 more students will have access who have never had access before simply because of the expansion of demand-driven and students will be able to decide on the basis of price.”
The department disputed Universities Australia modelling showing future engineering students could face total loan payments of $113,000 over 25 years.
But the full impact of the government’s proposed higher education overhaul remains unclear, because deregulation will allow universities to set student fees as they see fit.
In other developments on Thursday, officials from the Tertiary Education Quality and Standards Agency (Teqsa) confirmed they were not consulted about the government’s planned expansion of funding to private providers despite the regulator’s key role in accreditation of operators.
And the University of Melbourne announced it would cut 540 jobs over the next 18 months in a bid to save $70m.
The Senate’s education committee focused on the financial impact of the reforms on students, in light of a range of estimates by the university sector, unions, political parties and academics.
The latest effort to predict the consequences came from Universities Australia, the sector’s peak body, which called for the government to rethink planned increases to the interest rate on Higher Education Loan Program (Help) debts and the 20% average reduction in the commonwealth contributions to degree costs from 2016.
The modelling suggested future engineering students may have to pay as much as $113,170 in total – which assumed additional fees of $23,923 on top of the existing fee level of $37,319, plus $51,928 in interest charges at a rate of 4%.
This scenario was based on a “medium fee” level under deregulation – halfway between a figure tied to the average international student fee ("high fee") and the minimum fees universities would have to charge to recoup the expected cut to the commonwealth contribution for domestic students ("low fee").
An education department associate secretary, Robert Griew, said he had concerns relating to the assumptions of fees that could occur once existing caps were removed.
He said the modelling was also based on 2016 graduate salaries “even though the students we're talking about will be finishing in 2019 at the very earliest”, which had the effect of deflating the salaries from which repayments would be made. The number of years to repay included the years of study.
Labor’s higher education spokesman, Kim Carr, suggested to the committee that Universities Australia would not “put out modelling willy nilly” and asked: “If the experts from a wide range of fields have such differences of opinion and find this matter so confusing what do students make of it; why wouldn't they be thoroughly confused by what's going on?”
Paul said that she was “concerned by the range of supposed models and so on and commentary that's out in the market”.
Universities Australia is understood to be confident its calculations are sound. It said it had no plans to change its modelling and would “provide further clarification to explain its conclusions”.
Legislation outlined the full details of the reforms is expected to be presented to parliament in the spring sittings, but officials said modelling about likely fees could not be produced because universities would make their own decisions.
The education minister, Christopher Pyne, released calculations on Wednesday indicating that if students left university with a debt of $30,000 to $40,000, they would have to pay back between $3 to $5 extra each week on average.
Griew said those figures were simply to reflect the impact on repayments of the changes given a hypothetical starting debt.
He said the fundamentals of the Help system still applied: the payment was rated to the income of students and repayment did not start until earning a good income. "As a result of that it's a very favourable loan including at the bond rate of indexation."
Paul urged senators to view the reforms as a total package, arguing the funding to private colleges and sub-bachelor courses would act to restrain fee increases and enhance access.
Griew said there were a number of different models around the world to achieve diversity, pointing to polytechnics in the UK and colleges in the US. “To say that one system is the best risks furious debate; there are huge strengths in the Australian system, but we are trapped in a very monochrome system,” Griew said.
“Our current funding system does more or less compel them all to be much the same in what they are driven to do rather than being able to diversify.”
The opposition leader, Bill Shorten, reaffirmed Labor’s decision to fight the changes. He said Pyne was employing “a dangerous community-dividing dog whistle" in arguing that 60% of Australians who did not go to university were subsidising the 40% who attended.
"Minister, education is a public investment in the future of our country; it is not solely a private benefit,” Shorten said.
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