Australian Democrats' Supplementary Report
1. Introduction
The Democrats are in agreement
with most of the recommendations and observations of the Chair's report.
Accordingly, our supplementary comments and recommendations will be confined to
additional issues or areas where we have different views to those covered by
the Chair.
In 2000, the Democrats initiated
a Senate inquiry to investigate the capacity of public universities to meet Australia's
Higher Education needs. This inquiry, Universities in Crisis, was
extensive, receiving 364 written submissions and hearing evidence from 218
organisations and individuals in 13 cities around Australia. It is
disappointing that the recommendations contained in the report, Universities
in Crisis, did not receive Government support or consideration.
The Democrats acknowledge the considerable amount of useful
information produced during this committee and its relevance to the current
debate on the Higher Education Support Bill 2003 and its companion bills the Higher
Education Support (Transitional Provisions and Consequential Amendments) Bill
2003 and the Higher Education Support Amendment (Abolition of compulsory Up
front Union Fees) Bill 2003.
2. Overview of the Government's higher education policy
The Government's Higher
Education 'reform' package is flawed and contains policy proposals that
directly contradict Democrat policy and seriously threaten the sustainability
of the sector. The focus of the package is not on improving educational
outcomes, but on a market ideology with proposed changes that would result in
increased stratification in the sector and, more broadly, within
society. The package fails to address the ‘crisis’ in which our universities
have been since the early 1990s, largely as a direct result of poor grant
indexation by both Labor and Coalition Governments.
The Democrats have opposed and
voted against all attempts to impose fees on students. We have also strongly
opposed the decrease in student support measures. We believe access to publicly funded education is crucial to
overcome systemic disadvantage and it should be available to all regardless of
sex, age, health, socio-economic background, racial or ethnic origin or place
of residence.
In addition to the Chair's
report, we see the significant cost-shifting to students in the Government’s
package as a core problem.
Higher education plays a
fundamentally important role in our nation and it should not be left to the
blunt tool of market forces. The future growth, prosperity and independence of
our universities should be ensured through effective Government funding and
management.
Increased fees and student debt
are the direct results of deregulation. Already, a full up-front fee Bachelor
of Veterinary Science degree will cost $148,000 in 2004[1].
This example - and 40% increases in full up-front fees since 1998[2]
- typify the effects of a deregulated system. This type of fee increase can be
expected to continue under the Government's proposals and will potentially have
huge inflationary effects as qualified professionals increase their charges to
enable them to repay their large HECS debt.
University autonomy is essential
for academic rigour to be maintained.[3]
This autonomy is under threat from various aspects of this package (as
discussed in the Chair's report). While greater collaboration among
universities, industry and other Government agencies may produce economies of
scale and critical research masses resulting in significant benefits in the
specific area of the collaboration, Australia also runs the risk of losing a
great deal of its independent research capability and credibility.
The Democrats strongly support
the Chair's recommendation to oppose the Higher Education Support Amendment
(Abolition of Compulsory Up-front Student Union Fees) Bill 2003.
Other major concerns expressed
in the Chair's report, and shared by the Democrats, include the large amount of
detail absent from the legislation. A great deal of information is deferred to
guidelines.
A glaring omission in the ‘Crossroads’
report and subsequent legislation is the issue of student income support.
This is also an area that the Australian Labor Party has failed to address in
its Aim Higher: Learning, training and better jobs for more Australians
policy document and during their period in Government.
Prior to this Inquiry, the Government was already aware of
many issues in the sector from the Universities in Crisis report. The
Government, in its review Higher Education at the Crossroads, and in the
development of the legislation, has ignored the recommendations from the
earlier Senate report.
3. The effect of these
proposals upon sustainability, quality, equity and diversity in teaching and
research at universities
3.1 The financial impact on
students, including merit selection, income support and international
comparisons
3.1.1 The Impact of Fees
Despite the Chair's claim of
HECS operating since 1989 ‘without arousing opposition’, the Democrats have
been consistent in their opposition to student fees (including the Higher
Education Administration Charge and HECS). We voted against the introduction of
fees for second and higher degrees in 1982 and have voted against all fee
increases imposed by Labor and Coalition Governments since.
Graduates who benefit
financially from their education pay for that benefit through the taxation
system, but those who do not derive a financial benefit from their education
will be unfairly punished by having to carry a long-term debt burden. Thus, we
believe the Government's reliance on a 'user-pays' system is flawed, and the
proposals for increased reliance on student money will only exacerbate the
current inequities of the HECS system.
Evidence presented to the
inquiry supports the Democrat belief that the current HECS scheme is unfair.
Submissions by the Council of
Australian Postgraduate Associations, National Union of Students, ACOSS and
other organisations provided evidence of the deleterious effects of the current
HECS program on equity groups. Professor Bruce Chapman demonstrated that the
introduction of differential HECS in 1997 has increased the disparity of
participation rates between rich and poor students by 18% between 1988 and
1998.[4]
We are concerned about the
opportunities that will be available for female, Indigenous, low SES, rural,
regional and remote students in the proposed Higher Education package.
ACOSS, along with many other
organisations, identified debt aversion as a real factor in students deciding
whether they will undertake higher education. They conclude that this package
will further lower the participation of students from low SES backgrounds.[5]
DEST research shows that the
reduction of the HECS repayment threshold has had a negative impact on
part-time students.[6]
Evidence from CAPA reported declining fertility and home-ownership rates as a
consequence of high student debt.[7]
Recommendation
That
the HECS repayment threshold be, at a minimum, restored to average male
earnings over the next three financial years.
Recommendation
That the current parental
income threshold be lifted.
Recommendation
That the Government provide
HECS-exempt places to be allocated to equity groups and fields of study deemed
to be areas of national priority, or areas where there is unmet demand for
graduates but little private benefit and high public benefit (eg. Indigenous
and low SES students, nursing, science and maths teachers).
3.1.2 Loans for Full-Fees
A fundamental flaw in the
proposed FEE-HELP scheme is the impact it would have on professional
development in services that are already experiencing a shortage of supply of
professionals, such as midwives and science and maths teachers.
The Democrats opposed the
introduction of the PELS in 2001 and its extension to private colleges in 2002.
We do not support proposals to extend loans for full-fee paying courses to
undergraduates and all private higher education providers.
The postgraduate qualifications
required in numerous professions will be accompanied by the deterrent of
interest-bearing loans and uncapped fees. Some of these professions
provide relatively low starting-income levels, meaning a long-term debt burden
for those students.
Another anomaly of the FEE-HELP
scheme is the repayment method. It requires a student's interest-free HECS-HELP
debt to be paid off before the interest-bearing FEE-HELP debt. The Democrats
have estimated that this could add about $4,500 to a student's average debt.[8]
The concept of uncapped fees is
poor policy and is unacceptable to the Democrats.
Recommendation
That the proposed FEE-HELP
scheme be withdrawn because of the considerable evidence pointing to the
inequities and hardships it will cause for students.
3.1.3 Student Support
AVCC data on undergraduate
student finances confirms the extensive evidence from many student associations
to the inquiry, which showed students' financial concerns are having a
substantial impact on their studies with 70% of students being forced to work,
on average, two days a week during the teaching semester just to survive.[9]
The Democrats are concerned that
the current inadequate and restrictive student income support measures are a
false economy, and that restricting access to income support prevents many
students from entering higher education.
Successive Labor and Coalition
Governments have tightened the noose on student support measures, including
increasing the age of independence to 25; charging interest on late income
support repayments; and, cutting back Rent Assistance.
In 1997, the Democrats attempted
to remove taxation from part-time scholarships. We have consistently advocated
for all scholarships to be tax-exempt.
Numerous witnesses to the
Committee called on the Government to revisit their decision to increase visa
application fees from $315 to $400.
We support the Chair's
conclusion that the proposed student support measures are inadequate, however,
we differ in the extent to which we wish to rectify the situation.
Recommendation
That the age of independence
be lowered to 18.
Recommendation
That all forms of student
income support be raised to parity with the age pension over a 5 year period.
Recommendation
That all Commonwealth
education related scholarships be tax free, regardless of the student's study
mode.
Recommendation
That the Government reverses
its decision to increase visa application fees by $85.
3.2 The financial impact
on universities, including the impact of the Commonwealth Grants Scheme, the
differential impact of fee deregulation, the expansion of full fee places and
comparable international levels of Government investment
DEST figures on university
financing claim no university will be worse off under the new funding scheme[10],
however, evidence presented to the Committee was not in agreement. It is
interesting to note that the University of Melbourne has not done any
conclusive modelling of the Commonwealth Grants Scheme (CGS) because of the
many unknowns in the package.[11]
The Democrats share the Chair's
concern over the operation of the CGS and its likely effects of furthering the
divide between the historically well supported universities and others, i.e. a
move to a binary system and the decline of some universities.
The deleterious effects of the
proposed CGS would be felt most by those universities who are least able to
exploit the full-fee paying student market. This will impact most on the
regions with the greatest proportion of low SES background and debt averse
students, in particular, South Australia, Tasmania and rural universities.
The submission by Charles Darwin
University stated that even with 30% regional loading under the CGS they would
still be financially worse off in the first year of funding.[12]
From the evidence presented to the Committee, it is clear that the regional
loading component of the scheme will be inadequate to cover the substantial and
unique costs that face our regional universities.
Recommendation
That growth funding to
institutions be contingent on their capacity to meet agreed targets of
increasing participation from indigenous, low SES, rural, regional and remote
students.
Recommendation
As outlined in the
Australian Democrats' supplementary report to the Universities in Crisis
report - that at a minimum, university base grants be increased by 20% over 2
years to take account of unfunded changes in cost structures since 1996.[13]
Recommendation
That regional loading be
increased and take into consideration the costs of being a multi-campus
university.
3.3 The provision of fully
funded university places, including provision for labour market needs, skill
shortages and regional equity, and the impact of the 'learning entitlement'.
The Democrats believe that access to publicly funded education is crucial to
overcome systemic disadvantage and it should be available to all regardless of
sex, age, health, socio-economic background, racial or ethnic origin or place
of residence. Unfortunately, the Government has not provided enough places to
meet demand over several years and has left universities with over 32,000
over-enrolled students.[14]
The Democrats support the
Government's initiative to remove marginal funding for over-enrolled places,
but recognise the need to simultaneously replace this with fully funded places,
otherwise there may be compounding negative impacts on susceptible regions from
where funding and places are removed.
The inclusion of National
Priorities to address shortages in specific fields only goes part of the way.
To ensure high participation rates in the proposed 'National Priority' courses,
places should be HECS-exempt. The Committee was informed that the number of
National Priority places was inadequate to address teacher[15]
and nursing[16]
shortages. This initiative does not go far enough in identifying the full
number of National Priority fields or in its support of them.
As the Chair's report notes,
there was considerable concern about the Student Learning Entitlement. Further
to this, the Democrats are concerned about the implementation costs and ongoing
administrative costs for universities and the Department of such a system. The
system also has massive privacy implications.
Recommendation
As outlined in the
Australian Democrats' supplementary report to the Universities in Crisis
report - that the Government restore the number of fully funded postgraduate
research students to 25,000 EFTSU as part of a 10 year commitment that will
stabilise the sector.[17]
Recommendation
That National Priority
groups include special provisions for equity groups.
4. The implications of
such proposals on the sustainability of research and research training in
public research agencies
The absence of comment on this
issue in the Chair's report reflects the absence of the topic from the review
and the proposed legislation. However, we believe that teaching informed by
research is a hallmark of a university and thus, it should have been addressed
by the Government.
The view of some universities
that the proposed funding scheme could result in teaching-only universities[18]
needs to be noted as an indication of the seriousness of the possible
regressive impacts of this legislation.
5. The effect of this package on the
relationship between the Commonwealth, the States and universities, including
issues of institutional autonomy, governance, academic freedom and industrial
relations.
A fundamental flaw in the
Government's approach to the sector is its merging of university and
corporate identities. The Democrats reject any assertion of business principles
onto universities without the consideration of the broad mission of a
university including its relationship with its staff, students and community.
The Democrats disagree with the
Chair's claim that the inclusion of provisions on grievance and review
procedures is unnecessary and intrusive. While detailing specific grievance
procedures is not the role of the Commonwealth, the prescription of the
presence and publication of such procedures is a positive step.
The Democrats oppose the Higher
Education Workplace Relation Requirements (HEWRR).
The removal of the limit on
casual employment levels and any existing arrangements that may be in excess of
community standards will cause further deterioration of the scholarly community
within universities which, in turn, could result in poorer student learning
experiences. The Committee heard that relationships between staff and
university management have been strained by seven years of declining funding
and increasing workplace demands. Despite this seven-year trial, evidence
suggests that staff unions and management have had an effective working
relationship.[19]
The National Governance
Protocols drew criticism from several staff and student organisations. More
specifically, they identified the danger inherent in protocol 3 - that members
of governing bodies must act ‘solely in the interests of the university taken
as a whole’. The danger is in the lack of a definition of the ‘university's
interests’ and in who defines them. The Democrats are concerned that, in
defining a ‘university’s interests’, a person or persons can provide themselves
with greater power than others serving on the governing body.
6. Alternative policy
and funding options for the higher education and public research sectors
If the Chair's various
amendments were implemented, university funding levels are still likely to be
lower than when the Government came to power. The Democrats see this as a
failure of the Coalition Government to address the higher education needs of
Australians.
Specific policy alternatives to
the Government's package and the Chair's report have been detailed in previous
sections of this report. The key elements of the Democrats' policy include the
removal of financial barriers for students (such as phasing out HECS and other
higher education loans schemes; replacing domestic full fee-paying places with
Government funded places; and, a substantial increase in funding to allow for
significant growth and recovery from the past 10 years of under funding).
The Democrats also recognise the
desperate need for a targeted approach to increase the participation rates of
equity groups through the provision of scholarships.
Recommendation
As outlined in the
Australian Democrats' supplementary report to the Universities in Crisis
report - that a term of reference for the cross-sectoral advisory body be
ongoing cost-benefit analysis of reporting requirements and provision of advice
to the Minister of important gaps in data.[20]
Recommendation
The lack of thorough and
consistent research on educational outcomes by the Commonwealth that can be
compared with previous data has made critical analysis, of previous and future
changes to the sector, difficult. That the Commonwealth conduct research
into the effectiveness and broader social and economic impact of its higher
education policies using established benchmarks that will allow historical
comparisons of data.
Recommendation
That the number of
Commonwealth scholarships for equity groups be increased.
Senator Natasha
Stott Despoja
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