The Kemp Agenda - Myth vs Reality
14 October 1999
MYTH: DEREGULATING FEES WILL HELP US TO MEET UNMET DEMAND
FACT: Kemp is saying that `unmet demand will be met by lifting limits on number of places universities can offer’.
The key is that any extra places will be full fee-paying places. Kemp is not proposing to increase the number of publicly subsidised places, except possibly as a `sweetener’ in the short term. In fact, demand for university places has FALLEN since the Coalition was elected – by 4.4% in 1997, by 4.1% in 1998. Fall in demand among mature-age students was around 10%. The reason FOR FALLING DEMAND IS INCREASED COST.
MYTH: THE COALITION IS INCREASING OPPORTUNITIES FOR STUDENTS
FACT: The only opportunities will be for those who can pay, as the Coalition has already reduced publicly-subsidised places. In 1998, there were 16,500 fewer fully-funded places than had been budgeted for in Labor’s forward estimates. (Source: DETYA Higher Education Triennial Reports)
MYTH: COSTS TO STUDENTS WON’T NECESSARILY INCREASE
FACT: Kemp acknowledges in his paper that some unis will position themselves at the premium end of the market, and that cost behaviour is unpredictable
In the US – system he want us to emulate – costs of higher education tuition have soared. A study undertaken by Commission on National investment in Higher Education released in 1997 (Breaking the Social Contract – the Fiscal Crisis in Higher Education) estimated that if tuition fees rose at their current rate, effectively half of those who want to pursue higher education will be shut out. The main reason for soaring fees? Information technology infrastructure costs,; and universities jostling to position themselves near the top of the market. The Commission recommended increasing public investment to arrest this crisis.
In Canada, students are seeking to declare themselves bankrupt on the basis of soaring student debt. In New Zealand, there is strong media concern about graduates leaving the country to escape the burden of crushing debt levels.
MYTH: DEREGULATION WILL GIVE UNIVERSITIES GREATER AUTONOMY
FACT: Dr Kemp wants more, not less control over universities. He wants to tell universities what they can and cannot put in their enterprise bargaining agreements. He wants to make universities, not Government, responsible for equity, and will use threats to withhold funding to do so. He wants more control, while taking less responsibility.
MYTH: FUNDING FOR UNIVERSITIES IS INCREASING
FACT: The Minister’s claims that income available to universities is increasing is based on projections about the increasing proportion of income which comes via fees and charges. In fact, Government income to universities has been steadily decreasing since 1996, as the Government’s own figures show. They suggest that, under current arrangements, in the year 2000 Government funding to universities will be below 50% of total operating revenue, and around the same level they were in 1990.
Dr Kemp’s document acknowledges that eight universities are operating in deficit, and a number of regional universities in particular are at risk in a market environment.
The Minister’s agenda is to further reduce public investment in higher education, and make students pay in the vain hope that fee income will be sufficient to deliver the quality higher education system Australians deserve.
Total higher education revenue, 1990-1997 (actual)
and 1998-2001 (estimated) under current arrangements
Source: DETYA, Higher Education Report for the 1999-2001 Triennium, p.10
UNDER DR KEMP’S SCENARIO, THE PROPORTION OF PUBLIC MONEY FLOWING INTO UNIVERSITIES WOULD FALL DRAMATICALLY. Universities would be forced to gear more of their activities towards commercial enterprise – thereby compromising equity and diversity.