2017 higher education reform: cuts to universities, higher fees for students

The government have released their proposed higher education reform.

There are some welcome initiatives, such as legislating ongoing support for the Higher Education Participation and Partnerships Program (HEPPP) which supports access and equity in universities. This will be popular and is a good move for students.

But there are significant cuts, and students will pay more, a lot more.

They will phase in increased maximum student contributions by 1.8% each year between 2018 and 2021 for a total of a 7.5% increase.

Students will pay 46% instead of 42% of the cost of their degree on average. So for a four year course, this an increase in total student fees of between $2,000 and $3,600. The government claim the maximum any student will pay is $50,000 for a four year course, and $75,000 for a six year medical course.

They will also repay much faster and have their debts subject to different indexation. They will repay from $42,000 in 2018. This is a lot lower than the current threshold of $54,869. This lower threshold will mean many more students will need to pay.

The government claim that the cost for universities to deliver courses increased by only 9.5% between 2011 and 2015 according to independent analysis from Deloitte.

But Deloitte’s report specifically warns against using their comparison in this way, so we don’t know where the cost of teaching really increased by 9% over these years or not.

Universities will still be cut, suffering an efficiency dividend, where funding for teaching will be $380 million lower in 2019 than it would have been under the current formula.

Universities will also be more accountable by making 7.5% of each their Commonwealth Grant Scheme funding contingent on performance against benchmarks. This may result in a cut for some universities depending on the details of the benchmark.

From 2018, funding will be based on participation in admissions transparency reform and cost of education and research transparency initiatives.

From 2019, this funding will be dependent on performance metrics such as student outcomes and satisfaction, transparency and financial management with a formula to be developed in consultation with universities.

The government claim that there is a need to get the cost of higher education under control. We can only hope they have a vision for higher education to match.