Submission 

to

Senate Employment, Workplace Relations and Education 
References Committee

Inquiry into higher education funding 
and regulatory legislation

		
Submission no:
	314	
Received:	15/8/03	

Submitter:	Presented by:
Terry Healy, President
Isobel Cassidy, Education Vice President

Prepared by:
Kate Mills, Project and Research Officer	

Organisation:	Curtin Student Guild	

Address:
	Kent Street
Bentley
WA  6102
	
Phone:
	(08) 9266 2900	
Fax:
	(08) 9266 2996	
Email:
	research@guild.curtin.edu.au	

CONTENTS

TERMS OF REFERENCE

INTRODUCTION

FEES ARE A BARRIER

THIN EDGE OF THE WEDGE

30% DISTRIBUTION

REPAYMENT THRESHOLD

VOLUNTARY STUDENT UNIONISM

PRIVATE INSTITIUTIONS

DEREGULATION

APPENDIX
	-WA Campus losses due to Voluntary Student Unionism

TERMS OF REFERENCE

Senate Employment, Workplace Relations and Education References Committee

Inquiry into higher education funding and regulatory legislation

Terms of reference: 

1	The principles of the Government’s higher education package.

2	The effect of these proposals upon sustainability, quality, equity and diversity in teaching and research at universities, with particular reference to:

•	The financial impact on students, including merit selection, income support and international comparisons,
•	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, and
•	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’.

3	The implications of such proposals on the sustainability of research and research training in public research agencies.

4	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.

5	Alternative policy and funding options for the higher education and public research sectors.

The Curtin Student Guild will specifically be addressing the issues of the principles of the Government’s higher education package and the effect of these proposals upon sustainability, quality, equity and diversity in teaching and research at universities.

INTRODUCTION

The Curtin Student Guild represents all Curtin University students across Western Australia. We believe in an accessible, equitable, and quality Australian education system. We have been disappointed that the Government have failed in their $1 million dollar review of Higher Education to adequately address many of the issues facing higher education, and we hope that the senate inquiry can further examine the issues that are at the heart of the agenda the current government is determined to drive at the expense of education in this country.

FEES ARE A BARRIER
	
Fees are a barrier for students because of the high level of the fees, and the associated debt which students accumulate. Student debt “which is currently around $9 billion but is forecast to rise to $11.5 billion by 2006”  has spin off effects not just from a students debt aversion perspective when they may be assessing their future educational opportunities, but also the effects of debt on the individual post graduation and debt within society which may further impact on issues such as; fertility, home ownership, and fees charged by graduated professionals (eg- doctors, lawyers, dentists). 

When HECS was first introduced, the level was not arbitrarily chosen by how much the Universities needed, or the perceived market equilibrium of fee levels. The level was chosen based on what point people from low-SES backgrounds would be excluded from education based on financial imposts. The 1997 changes to HECS and the current Government proposal do not evaluate the impact fees and the associated debt will have, not only on individual students, but on the country as a whole.

The Guild supports the Government view that “every Australian …(should be)… able to find and achieve his or her own potential and Australian universities are on a long-term collision course with mediocrity that can only be avoided by embracing change now.” 
What the Guild doesn’t support the Government on, is the method by which they think they can achieve a more equitable, accessible and quality education system in Australia. Current domestic up-front fee places have already proven that increased fees do not translate to increased quality standards, in fact the opposite is occurring with entrance scores. Below is information from the National Union of Students report on Domestic Up Front Fee-paying students.

The Guild wants to be very clear on this: we do not see increases in student fees being about increasing student choice, about improving education, nor being in the long term best interest of this country. Fee increases are an ideologically driven barrier, and not developed within a sustainable model to improve education.

THIN EDGE OF THE WEDGE

There are 2 primary concerns about the future impact of the Nelson agenda in relation to 30% HECS increases and full up front fees. One is related to the true impact of the 30% increase. The other issue is related to the nature of HECS quota allocation on a system wide and university basis. Both proposals signal a path which can only be described as ‘The thin edge of the wedge’, namely things will continue to get worse, and governments will continually fail to address the real problems in Higher Education, and continue to increase fees for students.

True impact of 30% HECS

The Federal Education Minister is planning to allow universities to increase HECS fees by up to 30%. The Minister believes “This will allow institutions greater flexibility and promote a more diverse Higher education system”. There is no discussion about the wider implications of such a fee increase on student debt levels. 

The Federal Education Minister, Brendan Nelson has signalled that the 30% increase will only push fees up to a maximum of a $2,000 increase. The factors which also need to be considered are: if you are studying for 5 years, it is a $10,000 increase total ($6,000 in the least), the indexation each year on that amount, the compounded interest the following years on that amount, assuming the inflation rate is low, and assuming that during your degree the Government does not plan to increase fees further. 

The Guild agrees with the Federal Education Minister that “very difficult issues … have got to be addressed if we want Australia to have a world class internationally competitive university system.” However, the Guild has seen nothing in this package which specifically addresses the access, equity, and quality issues. The Minister has been misleading in his statements about the true impact of the fee increases, and the outcomes such a fee increase would produce (as discussed in fees are a barrier).

HECS quota allocation

The allocation of partially government funded places (HECS places) raises concerns on both a system and university wide basis. On campus, allocation of HECS places is often conducted at an administrative level, and internal political games can be played to manipulate which courses receive HECS places. This manipulation in a further deregulated environment may result in system and university wide fluctuations of HECS places to create an artificial demand for domestic full up front fee paying places in courses which are starved of HECS places. 

30% DISTRIBUTION

There is no doubt that universities are currently starved of funds, and that contributes to the current problems within Universities. However, the review conducted by the Minster failed to address many of the fundamental issues facing Universities; the distribution of internal funding.  The Curtin Student Guild is concerned that campuses already lack overall transparency in their financial accountability to students, without introducing further deregulated funding sources, which may be spent on any University project, not necessarily used to address the current problems with teaching and learning.

Again, the package proposed by the government does not seek to rectify quality issues within Universities, by addressing internal University funding distribution, and in fact exacerbates the problem by allowing them complete control over deregulated student fees.

REPAYMENT THRESHOLD

The Government has recognised the problems they caused when decreasing the repayment threshold for HECS in 1997. The proposed minimum HECS repayment threshold will increase to $30,000 from 2005 (currently $24,365). As you can see in the table below, there have been significant fluctuations in the HECS repayment threshold over time, and as highlighted the levels pre- 1997 were much higher than the current level. 

Year	Level	AWE (Full time adult employees)	
1988	22,000		
1989	23,583		
1990	25,469		
1991	$27,098		
1992	$27,748		
1993	$26,403		
1994	$26,853	34, 112	
1995	$27,675	35, 776	
1996	$28,495	37, 180	
1997	$20,701	38, 324	
1998	$21,334	39, 936	
1999	$21,984	41, 132	
2000	$22,346	42, 744	
2001	$23,242	44, 772	
2002	$24,365	47, 112	
2003	$25,348		
Proposed	$30,000		

The Education Minister argues that “the private benefits of higher education are significant.” When the government changed HECS to the current model of 3 bands, one of the rationales was that students in the higher HECS bands have a higher earning capacity, and indeed why students should continue to pay more fees is that they will earn more that people without a degree. If you accept that generalisation, as the government does, then why do they not accept that until you actually start receiving the benefits that your education is supposed to accrue, you should not have to start repaying that debt. 

As stated in the DEST Higher Education Report for the 2000 to 2002 Triennium, “A key equity feature of HECS is that payment arrangements are based on the individual’s capacity to pay”. Unfortunately this isn’t the reality for many students, as they are expected to repay the debt back before they have even accrued the benefit of even earning over average weekly earnings. Below is the table which indicates the below average weekly earning levels of graduate starting salaries

The Guild believes that students should not have to make repayments on their debt until they earn over average weekly earnings.

VOLUNTARY STUDENT UNIONSIM

The Guild believes that Voluntary Student Unionism is an outdated and ideologically driven agenda. This opinion has been formulated from actual experience as a students, and representative in a Voluntary Student Unionism environment. Despite the ideologue opinion of politicians or University administrators, the actual operation of VSU has produced results they did not foresee which are not welcomed by students. The material effects of VSU should not be absent from the Senate Inquiry Discussion. Appendix one illustrates the indicative losses faced by Guilds during VSU.

The efficiencies WA would have supposedly gained under VSU were done so in the same manner of the Australian banks, services were cut, branches closed down, and limits placed on our activities. As is the case for bank customers, the so called increases in efficiencies haven’t benefited the key stakeholders of the Guild- Students.

If the government presses ahead with the VSU agenda, the result will be a reduction of well utilised services on campus, a weakening of a student voice on campus, and campus life will dramatically reduce. It should also be noted that since WA VSU was repealed by the state government at the end of 2002, the experience on campus is not that students object to their freedom of choice, they object to paying more fees. And whilst many student organisations agree with the statement that compulsory fees limit Higher Education the lions share of the financial burden upon students and their families has been imposed by the Commonwealth Government or Universities as a ways of making it cheaper to provide an education that the whole community benefits from.

Student Organisations are easily the most effective means to fight against this shift of the cost of Higher education on to students, which is why the Guild believes that the VSU agenda is being pushed

PRIVATE INSTITUTIONS

The Government argues it can not put more money into public Universities; however they are prepared to continue to fund private institutions at the cost of public ones.  If the public system was funded adequately, there would be no need for private institutions. 

The other concern with Private Institutions are those which currently operate and how Universities use these are ‘alternate entry’ points, which decrease the quality of their degrees.  Under Brendan Nelsons proposed HECS hikes, fees will increase to a point where they are comparable to institutions that offer ‘alternate entries’ to Universities. The up front fee debate becomes redundant in the current environment of students already buying their way into a University degree.

“The Australian Institute for University Studies (AIUS) is a modern tertiary institution in Perth. AIUS is affiliated with Curtin University of Technology and associated with Monash University as well as Monash International. It is an institution providing tertiary study opportunities for both Australian and international students. AIUS provides students with a quality-learning environment on a campus where classes are small enough for each student to receive personalised attention.” 

The Institute is akin to a ‘sub-contractor’ for Curtin University, and by their own admission, and student experience; they offer the same units and course that students receive at Curtin Bentley.

Diploma of Commerce
“The course has the content and structure as taught in the first year of Curtin University's Bachelor of Commerce program. All aspects of the course, including assessment and moderation, are undertaken by Curtin University. International students who successfully complete the Diploma of Commerce are guaranteed admission to year two of the Bachelor of Commerce (BCom) or Bachelor of Business Administration (BBA) degree on the AIUS-Curtin Joondalup Campus. For Australian and Permanent Resident students to gain entry into those programmes, they must apply through the Tertiary Institutions Service Centre (TISC).”

Advanced Diploma of Commerce
“The course has the same content and structure as taught in the first two years of Curtin University's Bachelor of Commerce programme. It provides a tertiary qualification for students who are marginally unable to qualify for direct entry into an Australian university.”

”International students who successfully complete the Advanced Diploma of Commerce are guaranteed admission to year three of the Bachelor of Commerce (BCom) or Bachelor of Business Administration (BBA) degree at the AIUS-Curtin University Joondalup Campus. For Australian and Permanent students to gain entry into those programmes, they must apply through the Tertiary Institution Service Centre (TISC).
All aspects of the course, including assessment and moderation, are undertaken by Curtin University.”

The table below shows the comparison of fees with a 30% increase in HECS for Curtin Degree students. 

Campus	Course (Program) Name	Duration	Unit Fee A$	Annual Fee A$	Course Fee A$	TER entrance (2003)	
AIUS Joondalup	Diploma of Commerce	1 yr	$900.00	$7,200	$7,200	58	
AIUS
Joondalup	Advanced Diploma of Commerce	2 yr	$900.00	$7,200	$14,400	58	
AIUS
Joondalup	Bachelor of Commerce	3 yr	$900.00	$7,200	$21, 600	76	
Bentley	Bachelor of Commerce	3 yr	Up to $1044.00 average $892.00	$7,137 (Band 2 HECS)	$21, 411*	83	

*Does not take into account CPI increases for each of those years, nor the CPI compounded onto the HECS debt, nor the possible increases in HECS Universities may be able to charge under future governments.

The table above also states the Tertiary Entrance Rank cut-offs for entry to the diploma’s and degree. Students who have a considerably lower TER are able to gain access to the same course content at a similar cost to those students with a higher TER. Anecdotally, students studying at Bentley, where AIUS students are also doing the same unit have had assessment modified to accommodate the AIUS.

 Even more concerning, is the Advertorial which appeared in the Wanneroo Times, offering up to 45% discount for the courses. While Brendan Nelson plans to increase fees for those students who can access Curtin course content on merit, students with lower scores may also be getting ‘discounts’.
Discounted fees for new students
Wanneroo Times, 08/07/2003, General News, Page 42
Australian citizens and permanent residents have been offered up to a 45 per cent discount off tuition fees by the Australian Institute for University Studies. Students can complete a diploma or advanced diploma at the AIUS Joondalup campus which would make them eligible for advanced standing for several Curtin degrees.

It is concerning that content is offered to students with considerably less academic ability, at comparable if not ‘cheaper’ prices, and these students will gain access to a place at Curtin University Bentley. Alternative entries for students should be encouraged on merit basis, however in the current public education funding squeeze, Universities such as Curtin are compromising their graduates and reputation to make more money.

The additional concern with these Institutions is the staff time allocated to do the marking, teaching, etc. Again, student experience shows that lecturers cancel classes, or fail to attend a class on the Bentley campus as they are otherwise occupied with other teaching engagements, particularly staff being sent overseas during the semester term.

DEREGULATION

As a result of the government funding cuts since taking office in 1996, many courses have been and continue to be cut. Often these are smaller, more specialised courses, such as Podiatry. As these courses are cut, those people who may have thought about studying a particular course would have to consider where they are able to study. This decision about where to study is not purely based on costs of that university degree, or even the quality of the course alone. Many students are and will continue under the federal Government plans be excluded from their choice of education.

Deregulation of Higher Education is touted as a mechanism by which courses can remain open, by introducing up front fees. However, the Guild believes that if the government funded Universities enough, small courses would not need to be cut, and lumping students with more debt would not need to be considered. Deregulation doesn’t work in an educational environment for the following reasons:

Supply

The demand/supply model is flawed when considering Australian education, as supply is currently and under the government plans will continue to be tightly regulated to the point where many qualified students will be unable to enter university:

"As an extremely conservative estimate, the Commonwealth allocations for the next few years indicate that WA will still be short-changed by about 1200 university places and about million of recurrent funds," he (Carpenter) said. "This has resulted in WA having the highest university cut off scores in Australia, making it harder to get a place here than in any other State."

Supply problems are also exacerbated as more and more courses begin to close due to the strain of the increased costs of running courses, in an environment of decreased funding from governments. 

Demand

Student demand is not exclusively based on cost of the course, or even reputation of the course and this is particularly relevant to West Australian students, as the option to move interstate is not as viable, compared to people already on the east coast. The geographical remoteness means that students would have to leave their supportive environment of friends and family and move away from that vital study support. The cost of living on the east coast, compared to WA is also a concern.

APPENDIX

Guild Services affected by VSU

The Following List outlines the losses or reduction in services provided by WA Guilds because of the introduction of VSU. This list is not exhaustive, but rather indicative, and gives a flavour of the widespread and devastating effects of VSU, not only on the support and assistance provided to students, but also on the lives of those 	who were employed by the Guilds pre-VSU

Edith Cowan University Student Guild

	The Guild was insolvent and placed under administration

	All Twenty Eight (28) staff lost their jobs

	All Guild activities ceased for a time

Losses included campus activities, student newspaper, student advocacy services, student welfare services, no funding for clubs and societies, no funding for sports clubs

	Guild bookshop closed

	Guild service centre closed

	Twenty Four(24) hour/Three hundred and sixty five(365) day personal accident 	insurance for students was cancelled

Curtin Student Guild

Guild Education Office staff reduced from seven(7) to two(2), substantially reducing education research, grievance conciliation, advocacy, austudy advice, financial counseling, housing information, tenancy advice and legal and taxation advice 	services.

	Funding for the international student council, education council, activities office, 	sports, and media office was substantially reduced.

	The Sports Officer, Activities Officer and Media Officer lost their jobs

	Twenty Four(24) hour/Three hundred and sixty five(365) day personal accident 	insurance for students was cancelled

Guild Education Council grants to support students on field trips or placements were cut

	Funding for the Postgraduate Students association was significantly cut

The Guilds contribution to the provision of child-care services on campus was cut (435,000)

	Guild’s provision of out-of-hours childcare, and exam period child-care was cut

	Fourteen (14) staff lost their jobs

Murdoch Guild of Students

Personal advocacy for students appealing university decisions was reduced, and access 	to the service has been restricted to Guild members

	A resourced parenting room has closed

Food outlets and recreational facilities now run on a profit-making basis rather than a break-even or subsidised basis

	Funding for sports services and inter-varsity sport was lost

	A Guild service centre was closed

	Twenty Four(24) hour/Three hundred and sixty five(365) day personal accident 	insurance for students was cancelled

	Guild staff lost their jobs

The University of Western Australia Student Guild

	The sexual assault referral centre -  a valuable and vital student welfare service that 	included a trained professional staff member - closed down

28 Jobs lost, including: Guild Education Research Officers, Sexual Assault Referral Officer, and Finance and Administrative support jobs

  	The total representative budget was slashed from $135,000 to $25,000 on the 	introduction of VSU

	Student welfare budget cut from $70,000 to $45,000

Severe cuts to campus activities budget including a 45% reduction in funds for clubs and societies

	Textbook subsidy scheme cut substantially

	Guild computer lounge shut down

	Guild sports division became a separate organisation funded by the University

Funds for maintaining Guild property fell from $320,000 to $120,000, making the Guild increasingly reliant on the University for the development of an new services for students
 
	Twenty Four(24) hour/Three hundred and sixty five(365) day personal accident 	insurance for students was cancelled