Opinion & Commentary
Scrap this outdated fee
As many media reports on voluntary student unionism have pointed out, supporters of the Government's legislation to abolish compulsory student union membership and fees were once student politicians. Peter Costello and Tony Abbott campaigned against the radical-Left Australian Union of Students in the 1970s. Tony Smith and Sophie Panopoulos were campus foes of left-wing student unions in the 1980s.
The VSU campaign's origins in '70s and '80s student politics is not just of biographical interest. It is a by-product of the funding system at the time, not 2005 funding arrangements.
To understand the VSU issue, we need to go back to 1974. From then until 2004, universities could not collect any tuition fees from commonwealth-subsidised students, though from 1989 to 2004 the commonwealth levied HECS charges. Instead, the commonwealth funded tuition. It gave universities money to pay for their "operating purposes", which did not include non-academic services.
Though universities relied on government for tuition costs, they could charge fees for non-academic services. This is why all universities have a separate, readily identified, fee that funds -- as we have heard regularly this past week -- child care, sport, welfare and student politics. Unsurprisingly, this separate charge became the focus of Liberals unhappy with student unions. The VSU campaign was the result.
Starting in the late '80s, policy changes progressively undermined the rationale for a separate amenities fee. First the then Labor government liberalised rules surrounding full-fee-paying overseas students. In the first half of the '90s it did the same for Australian postgraduate coursework students. In the second half of the '90s the Coalition introduced full-fee-paying undergraduate places.
The cumulative effect of these three changes was that by the end of 2004 more than one-third of students were outside the system where the commonwealth paid for tuition and students paid for non-academic services. They could have their academic and non-academic service fees bundled into a single charge.
A fourth policy change almost destroys the rationale for the separate amenities charge. Under federal Education Minister Brendan Nelson's higher education reforms, the commonwealth no longer funds all the tuition of "commonwealth-supported" students. Instead, it pays a subsidy per student to the universities, which then charge students a fee within a price cap of 25 per cent more than the old HECS charge. So universities directly charge virtually all their coursework students for tuition.
The fundamental legal rationale for a separate charge is gone. The main reason for a separate amenities fee is the low price cap on student contributions. Since most universities need all the student contribution amount to sustain their academic activities, they don't want to give up this separate, uncapped, right to charge fees.
If it were not for the student contribution amount cap, the VSU legislation would be of little consequence. Those universities that don't already allow students to opt out of student association membership would need to change their rules.
Students would be better off deferring all their higher-education costs through HECS-HELP or FEE-HELP and without a confusing second price.
What should universities do? They should incorporate charges for amenities into the prices paid by their full-fee students. The present amenities fee cannot be deferred through FEE-HELP, but since the VSU legislation will effectively eliminate the fee this prohibition will be redundant. Fee-paying students would no longer have any up-front charges.
For commonwealth-supported students, universities should focus on the student contribution amount. Universities that maintain their student contribution amount at the old HECS rates, such as Macquarie or the Australian National University , have no problem. They can abolish their amenities fee and increase their student contribution amount.
Other universities ought to campaign for a higher student contribution amount. The present 25per cent cap on HECS is purely a political compromise on the 30 per cent increase the Government wanted back in 2003. Since the usual opponents of fee increases support student services, they can hardly oppose a higher student contribution amount that would fund them. With a Senate majority and fee opponents neutralised, the Government has no excuse not to lift maximum student contribution amounts.
Despite the heated rhetoric on both sides of the VSU debate, in the long term this legislation will have much less impact than either side is claiming. By being placed in the normal university budgetary process, non-academic expenditure will face more rigorous examination and evaluation. But universities should be able to offer and fund the services they think necessary.
Andrew Norton is a research fellow at The Centre for Independent Studies.
