Opinion & Commentary
Who says uni deregulation is politically unpopular?
WHAT a difference 2½ years make. In October 1999, after then education minister David Kemp's plans to reform Australia's universities were revealed by the Opposition in parliament, John Howard ruled out any significant change. Universities were again trapped, unable to raise money from the Government or their students.
This week the Opposition tried to derail another Education Minister, Brendan Nelson. Nelson had issued a discussion paper on higher education reform in April, which did not rule out fees. Jenny Macklin, Labor's spokeswoman for education, used question time on Tuesday to ask Howard to rule them out. Unlike in 1999, this time he refused, ruling fees neither in nor out, but stressing that the Government must be willing to address proposals for reform.
The universities' situation has changed only slightly since 1999, but the political situation has changed significantly. The roots of that change are, oddly enough, back in October 1999. Despite the ALP's scare campaign about $100,000 degrees, endorsed by interest groups and newspapers, the Government didn't suffer in the polls. In fact, it went slightly up. The leak certainly didn't help the Government, but it didn't seem to be the kind of issue that changed many votes either.
The 2001 election confirmed that education wasn't the dangerous territory the Government feared it might be. The ALP ran on a Knowledge Nation platform, backed by interest groups such as the National Tertiary Education Union, which ran a marginal seats campaign.
Again, there was no evidence that education helped Labor. Of the 13 seats targeted by the union, the ALP won only two extra, and the Government improved its position in seven. The then ALP shadow education minister, Michael Lee, even lost his seat of Dobell.
The Government also knows that many ALP attacks can be deflected. Ordinary Australian families will not be facing $100,000 degrees. This year, for example, an average overseas student paying full fees for a commerce degree will pay $11,500, or $34,500 for a three-year degree.
Since the Government is certain to keep subsidies, the cost to Australian students would be much less than that to overseas students. The ALP overstates likely costs by a factor of four or five.
Nor will the poor be excluded. Every time costs rise, whether it was the 1989 introduction by Labor of the HECS system, or the increases in HECS implemented by the Coalition in 1997, we're told that this will price the poor out of university.
It hasn't happened, thanks to the Hawke government's policy ingenuity in establishing an income contingent loans system, which means that students repay only when they earn an adequate income. In fact, the number of low-income people attending university has increased significantly since 1989. The main thing keeping low-income people out of university these days is not money, but their Year 12 results.
Fees for university students will be easier for the Government to sell than past increases in HECS. While more costly HECS is undoubtedly good for the average taxpayer, by reducing universities' drain on public revenues, it is of no advantage to students. It is all costs, no benefits.
Fees have a different dynamic. Since with fees the money goes to the universities, not the Government, there would at last be money to lower student-staff ratios, restock libraries, repair buildings, provide more computers and do the many other things that need doing to make Australia's universities better places for students.
Paying for quality isn't such an unfamiliar notion for Australians. After all, many are already making a similar decision to send their children to private schools, rather than put up with the various deficiencies they perceive in the public system. With the income-contingent loans system, demand for fee-based higher education is likely to considerably exceed demand for private schools with up-front fees.
When you think about it, both the Government's previous stance and the ALP's current position are very strange. They forbid undergraduates from investing in what, for the vast majority, is their most important income-producing asset, their own human capital. Students are, it seems, intelligent enough to be admitted to university, but not bright enough to work out what is a good educational deal for them.
To put it politely, these are counter-intuitive ideas. They always have been, but the politics of reform were seen as too hard. That's now changing. In the past week, the Australian Vice-Chancellors Committee and the Government have opened the door to reform. Australia might yet have a higher education system equal to our knowledge nation aspirations.
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About the Author:
Andrew Norton is a research fellow at the Centre for Independent Studies in Sydney and was a senior adviser to former education minister David Kemp.
