INCREASING STUDENT DEBT NOT THE ANSWER TO PROFESSIONAL SKILLS SHORTAGES
10 May 2006
The announcement in last night’s Budget to increase the cap on loans for local fee-paying students to up to $100,000 will not fix the professional skills shortages facing Australia and only leave students even further in debt, the National Tertiary Education Union (NTEU) said on Wednesday.
“NTEU recognises the Budget contained a number of significant one-off funding measures for research and for individual universities,” said Dr Carolyn Allport, NTEU President.
“It failed, however, to deliver a systematic and sustainable investment strategy for our universities, who are the key players in producing the skilled professionals necessary for our economic competitiveness.”
“Although the Budget contained some additional university places for doctors and nurses, the Government’s announcement that it will increase the amount students can borrow under FEE HELP is no solution to the professional shortages in areas such as medicine and engineering.”
“Increasing the amount that domestic fee paying students can borrow under FEE-HELP from $50,000 to $80,000 and to $100,000 for medical and veterinary degrees, while an admission that these full fee courses are too expensive for students to access without financial assistance, will do little to tackle skills shortages.”
“This is because the majority of students and their families will be wary of amassing such large debts and their ability to pay these off.”
“Despite all the hype, the actual take up of full fee paying places at public universities so far constitutes only 1.5% of student load.”
“By the Government’s own admission in the Budget papers the increase in the FEE-HELP cap is expected to help only 900 students.”
“It is unlikely that anyone who does pay up to $200,000 for a degree will emerge from their course being prepared to practice as a GP in rural or isolated areas where the greatest shortages currently exist but where salaries may not be commensurate with those in urban areas.”
“Increasing the FEE-HELP cap also misses the broader problem underlying professional skill shortages, that is that the allocation of Government funded university places is not based on any data identifying future workforce needs and areas of emerging skills shortages.”
“Instead of loading up students with more debt, what the Government should do is ask the Productivity Commission, or a similarly qualified agency, to undertake a detailed study of Australia’s future skills needs in professional areas that could be used to inform Government policy in this area,” said Dr Allport.
Information and Comment:
Andrew Nette, NTEU Policy and Research Coordinator: 0438 026277