RIGHT DIAGNOSIS BUT THE TREATMENT COULD KILL THE PATIENT
February 27, 2006
The Centre for Independent Studies’ conclusion that the Federal Government’s full fee paying loans system is not serving the interests of university students is correct, but their recommendations for change, including allowing students to borrow up to $160,000 for expensive courses, are not the solution, the National Tertiary Education Union (NTEU) said on Monday.
“While the NTEU agrees with the CIS report’s diagnosis that the Government’s loans scheme for students studying at Australian universities is broken and needs fixing, we are concerned its treatment could kill the patient,” said Dr Carolyn Allport, NTEU National President.
The CIS report recommends that the total debt that university students should be allowed to acquire to finance a full fee course should be raised from the current limit of $50,000 to $95,000, or $160,000 if enrolled in more expensive heath related courses.
It also argues that in order to avoid “bad debts” the Government should ensure that these loans only be made to students assessed as being able to meet the repayments.
“It is true that the $50,000 cap that university students can borrow to fund their studies is often insufficient to meet the cost of more expensive courses such as medicine and that this is leading to labour market shortages.”
“The last thing we need to do if we want to encourage students to study at university, however, is to introduce policies that could leave them with a prospective debt to the Government of up to $160,000 on graduation.”
“There are already significant negative equity implications arising from the Government’s full fee loans scheme and that increasing the amount that students will be able to borrow under it will only make the situation worse.”
“The way to overcome labour market shortages is to provide more government-supported university places in courses of high demand. That way access to university is determined on basis of the academic merit of prospective students and not on their or their family’s capacity to pay.”
“At present a student who misses out on a government-supported university place because they failed to gain a high enough entry score can buy a full-fee place even if their entry score is well below the cut-off mark for government supported places. This is where the real inequity and discrimination is.”
“Making university education more expensive and increasing student debt will only make it less attractive. This will be to the detriment of all Australians whose economic and social prosperity depends on higher levels of public investment in education, not less,” said Dr Allport.
Information and Comment:
Dr Carolyn Allport, NTEU President: (03) 9254 1910
Andrew Nette, NTEU Policy and Research Coordinator: (03) 9254 1910