The Hidden Costs

Uni course fees expected to double, analysis shows

(Sydney Morning Herald, 1 June 2014)

Students will be hit with double fees for some arts degrees and at least 55 per cent rises for engineering and science degrees at the University of Sydney under the federal government's controversial overhaul of higher education.

An analysis of the cost implications to the university from the government's planned 20 per cent reduction in funding for university places shows fees for communications, social science, environmental and engineering degrees will soar.

A Sydney University three-year bachelor of environmental systems costs a domestic student a minimum of $25,839 based on current fees.

Under the changes, students would face a bill of at least $42,405 for the same degree from 2016.

A communications degree costs a student about $18,132 but that would skyrocket to about $37,000.

The predictions are similar at the University of Melbourne where vice-chancellor Glyn Davis expects fees for engineering degrees will rise by at least 60 per cent and science degrees by about 54 per cent.

There could be big changes in Sydney University fees.

This means a Melbourne University bachelor of science degree with a civil systems engineering major, which costs a domestic student a minimum of $24,082, would rise to at least $38,772.

In an email to university staff, Professor Davis said the fee forecasts did not cover expensive courses such as medicine and law, which some experts have predicted could triple in costs or rise even higher.

“Fees would need to rise by 45 per cent to make up lost funding in social science disciplines, by 54 per cent in science, and by 61 per cent in engineering,“ Professor Davis wrote.

“Everyone on campus, student and staff member alike, understands we are now entering an unprecedented era in higher education.“

Professor Davis said the upshot of Education Minister Christopher Pyne's policies was that ''much public funding will likely be removed from tertiary education''.

He said few people had noticed the government's 20 per cent cut to the Commonwealth Grants Scheme, ''along with cuts or abolition of small funding schemes supporting teaching excellence and participation initiatives.''

“Universities are invited to make up this gap through higher fees,“ Professor Davis said. “Students would get nothing new for this increased debt,“ he added, contradicting Mr Pyne's arguments that students will get a better deal and better facilities once their universities were open to market competition

The University of NSW is still finalising its modelling, but its acting vice-chancellor, Iain Martin, said the university had been “hit harder than many universities by the changes to cluster rates“.

“The size of our engineering faculty in particular means that for us there is an overall cut of 24 per cent in government funding,“ Professor Martin said.

“Given the critical importance of these programs to Australia's future, we will be doing our utmost to reduce the impact on students studying in these disciplines.“

Responding to Professor Davis' email, Mr Pyne said “some fees will go up and some will go down“.

“In a deregulated environment all higher education providers will have to compete for students,“ he said.

On Sunday, Mr Pyne told the ABC's Insiders program that competition between universities would keep fees down.

"If universities think they can get away with charging exorbitant fees, I think you will find they face intense competition," he said.

"I think we will see a great deal of speculation but I'm not going to respond to different statements or claims being made by particular vice-chancellors, because at the end of the day, I think competition will drive prices down."

In the most radical overhaul of higher education since Gough Whitlam introduced free tuition in the 1970s, the Coalition is proposing to deregulate university fees, allowing universities to charge whatever they want for a degree.

An interest rate of up to 6 per cent will also be applied to student debts for the first time.

By Alexandra Smith, Jonathan Swan, with Judith Ireland


Student fees set to double as funding cuts take their toll

(Sydney Morning Herald, 16 May, 2014)

Fees are expected to more than double for environmental studies and communications students when they are deregulated in 2016, while mathematics students are set to emerge as winners.

The federal Department of Education this week released new funding rates for students who enter university from 2016, with total government funding declining by 20 per cent.

Universities will be able to charge as much as they want on top, with graduates to pay back the debt once they start earning $50,638.

Government funding for environmental studies students will fall by 44.5 per cent, according to an analysis by Grattan Institute higher education program director Andrew Norton. This means universities will have to charge students $9662 more a year to maintain current funding levels - a 112 per cent increase.

Commonwealth support for communications students will drop by 50 per cent, meaning budding journalists and public relations professionals would pay $6010 more a year - a 99 per cent increase. Fees for engineering and science students would rise by at least $5059 a year, a 58.7 per cent increase.

Nursing and teaching students face fee increases of at least 19 per cent and 23 per cent respectively.

Fees would rise by 49 per cent for visual and performing arts students, by 43 per cent for social studies students and by 42 per cent for agriculture students.

Mr Norton said these were the minimum increases he would expect and fee deregulation would allow highly regarded universities to charge far more for popular courses.

Education economist Bruce Chapman, the architect of the HECS repayment scheme, predicted fees would triple at top universities.

Education Minister Christopher Pyne said on Thursday he expected fees for some courses to rise and others to fall.

While the government is cutting support for most disciplines, mathematics and statistics students will receive a 23 per cent funding increase. Fees for a mathematics degree would fall by 26.3 per cent at current degree costs.

Commonwealth funding for humanities will rise by 8.9 per cent while support for allied health and clinical psychology will remain stable.

Minimum student contributions for law, accounting and commerce are expected to remain stable.

By Matthew Knott


Students face $50k uni debts

(The Australian, 29 December, 2006)

Students are running up debts of more than $50,000 to earn a university degree, prompting the architect of HECS to warn that graduates are paying too much.

As new figures confirmed students are leaving university with debts much larger than the average of $10,500, Bruce Chapman, who developed the original scheme for the Hawke-Keating government, yesterday disputed the Howard Government's claims that students are paying only about 25 per cent of the cost of a degree.

"My view about the HECS charge level is it shouldn't go any higher," Professor Chapman said.

"Does it stop people going to university? The answer to that seems to be no. But the next question is how much should students pay compared to taxpayers. We're now at a level of about 45 per cent of the recurrent cost. I think the case for making that higher is very weak."

Department of Education figures obtained by The Australian have revealed that more than 1000 students have debts of more than $50,000 and 5190 students have debts of more than $40,000.

One in three of the one million students in Australia who currently have a HECS debt owe the Government more than $14,000.

Students who miss out on marks and enter university through a full-fee degree can pay much more, up to $200,000 for a medicine degree, the majority of which must be paid upfront and is not covered by the Government's loans scheme, FEE-HELP.

The new figures reveal the cost of a publicly funded HECS degree is growing rapidly, despite John Howard's 1999 pledge to parliament that "there will be no $100,000 degrees under this Government".

Professor Chapman, who recently published a book on income-contingent loan schemes, Government Managing Risk, said he also believed Canberra should abolish the highest-cost full-fee degrees.

"At some point, and I think we're pretty close to it, the contribution students are forced to make will be too high," he said.

His comments came as the Labor Party prepares to unveil the centrepiece of its higher education policy - a pledge to slash the cost of degrees to tackle skills shortages in science, maths, engineering and for doctors working in regional areas.

From next year, the cost of a publicly funded HECS place in medicine will cost students more than $50,000 for a six-year degree. A combined law-arts degree could cost almost $45,000.

Students currently receive a 20 per cent discount if they pay their HECS fees upfront.

From next year, the amount a student can earn before they have to repay a HECS debt will increase to $38,149 and students must then give the Government 4 per cent of their income, or about $1500 a year.

The HECS repayments increase as students earn more. For example, graduates earning more than $70,847 a year must contribute 8 per cent of their income, or up to $5667 a year, towards retiring their HECS debts.

Opposition education spokesman Stephen Smith confirmed yesterday that the ALP was also considering the merits of an across-the-board HECS cut after universities were last year allowed to increase fees by up to 25 per cent.

"In particular, I am examining ways to relieve the debt burden for students who undertake degrees in essential areas like science, maths and engineering, which are essential to our international competitiveness," he told The Australian.

"This includes consideration of income support for such students as well as across-the-board relief from the burden of HECS.

"Kevin Rudd and I have made it clear that these issues of access and affordability are the top of Labor's priorities for education."

However, Education Minister Julie Bishop yesterday said recent research confirmed that HECS did not discourage students from poorer backgrounds from participating in higher education.

"Student contribution loans are interest-free and repaid through the tax system when they can afford it," she said.

"HECS was introduced by the Australian Labor Party in 1989 to ensure students made a fair contribution to the cost of their studies (and) under the Howard Government students pay only 25 per cent of the cost while taxpayers pick up 75per cent of the cost of a student's university education.

"Recent research shows university graduates can expect to earn average starting salaries of more than $40,000, with many graduates earning a starting salary in excess of $60,000.

"Although recent figures point to record numbers of students at university, I am concerned that Labor's scaremongering on this issue may frighten some young people away from attending university," Ms Bishop said.

Victorian National Union of Students President Caitlyn O'Dowd said the Government's much-quoted average HECS debt of $10,500 did not reflect the true cost of a degree.

"The largest I have heard is about $80,000 for medical students who have gone on to postgraduate work as well," Ms O'Dowd said. "We've got a skills shortage but they are being put off by these big fees.

"Because of the large number of people who don't finish their course, that brings the HECS debt average down quite a bit.

"We haven't seen the worst of it because we just saw the last big increases in HECS a few years ago.

"Now we are hearing these horror stories because they are increasing fees even more."

Students face $50k uni debts, by Samantha Maiden, The Australian, 29/12/2006)

Price of knowledge a heavy burden

(The Australian, 29 December, 2006)

When Innes Bailey graduates from university next year at the age of 23, he will enter the workforce with a business degree and a debt of more than $30,000.

His degree will help him find a job, but he is unlikely to pay off the debt until he reaches his thirties. "It will probably be between $30,000 and $35,000," Mr Bailey said yesterday.

"There would be no hope of paying it upfront, even if my parents wanted to."

Under the HECS system, students can defer fee payments but must start to repay the debt through taxation once they earn more than $36,000 a year.

Mr Bailey's debt is higher than for a basic economics or arts degree because he started in one faculty after he finished school before moving to others.

"I did a year of arts, two years of design and two years of economics and finance," he said.

"I will be graduating in a business degree. I can only name one friend from high school who stuck with a degree and didn't change at least once.

"When I first found out how much it was, it didn't completely surprise me. I've been at university for five years. It's just something you have to deal with if you go to university."

Student leaders claim the number of graduates with large debts is set to grow as the 25 per cent rises in HECS fees from last year onwards flow through the system.

Queensland National Union of Students president Dan Doran said he knew many students with debts significantly higher than the $10,500 average.

"My HECS debt will be about $24,000," he said. "To be employable today, a lot of students are doing double degrees and they are costing more.

"It's a national disgrace that we are the only country to decrease spending on education as a percentage of gross domestic product."

Council of Australian Postgraduate Associations president Nigel Palmer said postgraduate students faced even larger debts.

"HECS is capped, but in the case of ... postgraduate degrees those universities can basically charge what the market will bear for them," Mr Palmer said.

"If people are already loaded up with significant HECS debts, it's a real disincentive to take on further postgraduate studies.

"There are fewer and fewer incentives to stay on and undertake research."

Price of knowledge a heavy burden, by Samantha Maiden, The Australian, 29/12/2006)

Top scientist Harry Messel warns of university mediocrity

One of Australia's most eminent scientists, Professor Harry Messel, has warned of "big-is-best" values which are undermining the credibility of universities as effective teaching and research institutions.

Some quotes:

"It is accepted generally that mass education and quality are a contradiction in terms, especially in the tertiary field, and normally mass education and mediocrity appear to be natural bedfellows."

"Education must be deregulated and strong diversity among institutions encouraged. Students must be provided with a wide choice and at varying levels. As an opener, cut the management staff of universities by 50 per cent or more. This would slow - but not stop - the paper war which is going on at present. It should also put an end to all this nonsense about total quality management, quality assessment and various other time-wasting "processes". Let us get back to what universities are best at doing, namely teaching and research."

"The value of a bachelor's degree from many institutions has been devalued and often fails to impress employers. Students who wish to get ahead now require a higher degree or several degrees or to go on to a second university."

"My remarks are based on 54 years' experience in university education in Australia. During this period there have been major transformations in secondary and tertiary education which, unfortunately, have close counterparts in Canada, Britain and in an increasing number of European countries."

(Harry Messel, Beware universities' quest for mediocrity, Sydney Morning Herald, 13 September 2006)

Student debts heading towards $20 billion

"University students and graduates will owe the Government nearly $20 billion in three years as debt accumulates by almost $2 billion a year.

They now owe the Government a little more than $13 billion, figures provided by the Department of Education to a Senate estimates committee show, and the figure is increasing as fees for individual courses rise. By 2008-09 the debt will reach $18.8 billion.

The average outstanding debt was about $10,500, said a spokesman for the federal Minister for Education, Julie Bishop. This represents a rise of 7 per cent since last year. Fees for some courses have risen to more than $30,000."

(Harriet Alexander, Student debts heading towards $20b, Sydney Morning Herald, 13 September 2006)

Graduate: University 'the worst investment'

"The scarecrow in The Wizard of Oz should have done the maths before he wished for a brain. In my experience, the brain is a black hole for investment that may never pay off.

That may sound like a bleak assessment but I'm contemplating an ever-mounting consumer price index-adjusted $20,000 HECS debt with nothing but three pieces of paper shoved in a drawer to show for it. When I left high school, I had two paths from which to choose: one to university and the other to the working world. I chose university."

(Meagan Phillipson, Graduate: University 'the worst investment', The Australian, 1 March 2006)

University students face life of debt

"Almost one-third of the multi-billion dollar HECS debt owed by university students has been written off by the Federal Government as a bad or doubtful debt.

The figures, supplied through Senate Estimates, predict that $2.9 billion of the $10.2 billion owed through the Higher Education Contribution Scheme for university fees is unlikely to be repaid.

The Opposition spokeswoman on education, Jenny Macklin, said the figures portrayed a depressing future for many university graduates, with one in three likely to die before they paid off their HECS debt."

(Kelly Burke, University students face life of debt, Sydney Morning Herald, 8 September 2005)

It costs a student at least $54,000 to take a three-year degree, new research has shown.

"The survey, of 30 Australian tertiary institutions, looked at tuition fees, accommodation costs, transport, books, extra university charges, food and clothing, and added in a modest entertainment allowance of about $30 a week.

"A three-year arts or humanities degree would set a student back between $18,000 and $29,000 a year — the higher figure includes the cost of university college accommodation and the payment of tuition fees up front. Science students would face a base cost of $19,800 a year. For medical or dentistry students, who typically study for five or six years and have higher textbook and deferred fee costs, the base annual cost was $21,000."

(Gerard Noonan, "Welcome to uni, prepare to pay up to $130,000", Sydney Morning Herald, 19/1/2002)

More than 40 percent of students drop out of Arts and Science degrees.

A study of completion rates based on students who started in 1993 found that six years later, only 58 percent of arts and science students had finished their studies.

"Education Minister Brendan Nelson has played down the figures, saying students leave their courses for a variety of reasons and there is no evidence the drop-out rate is getting worse. But Opposition education spokeswoman Jenny Macklin yesterday accused the Government of complacency and linked lower completion rates to a lower standard of living."

(Sean Parnell, "Nelson plays down high university drop-out rate", Courier-Mail, 16/1/2002)

A top Australian academic says students prefer things unis are poor at delivering.

Former University of Central Queensland vice-chancellor Lauchlan Chipman says the reason private education is profitable is that students willingly pay for the five things they value most.

These are all year-round teaching, high quality personal learning resources (notes, videos, and computer software instead of lectures for example), teaching at a location and to a timetable which is personally convenient, small class sizes with high levels of interactivity, and access to computing and networks with a minimum of queuing.

"Today's traditional public sector universities provide these features very poorly, if at all. But when for-profit universities provide these features and scrap the manicured lawns, the familiar sporting, cultural, and social amenities — and the traditional academic staffing profile — it costs considerably less.

"This results in the very high margins to which reference has already been made. In essence the fee levels set by public sector institutions have determined the fee regime. For students who perceive the traditional public sector suite of services as constituting an inferior product, the for-profit provider fees are genuinely competitive, high margins notwithstanding."

(Lauchlan Chipman, "Paying for a future by degrees", The Australian, 24/10/2001)

Read the full lecture

A big F for universities

"They once were icons of integrity, citadels of civilisation, bastions of benevolence. But universities have fallen on hard times and so, too, have their reputations."

(Leading article, Sydney Morning Herald, 15/8/2002)

Read the editorial

No credit in devalued degree

Retiring academic Alice Tay claims falling standards may soon make universities irrelevant

(Sydney Morning Herald, 8/1/2003)

Read Paul Sheehan's article

Uni standards falling: report

"University lecturers believe academic standards have fallen over the past decade, with many saying they are under pressure to pass students who should be failing, a national study has found.And in a surprising finding, the report, involving more than 2000 staff at 12 universities, says vice-chancellors and deans are unable to provide evidence for claims that universities have high standards."

(The Age, 12/1/2003)

Read the article

University not the only place

"The first ritual of the academic year is upon us with the annual announcement that "thousands" of qualified school leavers have missed a place at university. It's a ritual vice-chancellors love because it appears to indicate that our universities could accommodate many more Australians eager to learn if only the miserly government would properly resource them. In fact, it demonstrates no such thing. University funding is largely tied to enrolments and institutions will always strive to fill all the places Canberra will fund and adjust their entry scores accordingly. After subsequent rounds of offers, very few students who want to go to university this year will fail to qualify for a place of some kind. The often ignored consequence is that many will enrol despite the fact they struggle with study, or find it does not meet their needs and aspirations. Over 30 per cent who begin university never complete the course they began.

"The problem is that universities are too successful in marketing their products as the best basis for a career. The result is that TAFE, which provides flexible mixes of work and study and teaches specific job-related skills, is too often ignored by young people. We need both forms of post-school study but the flexibility and competency based-approach ? where students are assessed on skills rather than their ability just to pass exams ? that TAFE provides is particularly well suited to the emerging knowledge economy where all workers will need to retrain throughout their careers. If the state government TAFE systems marketed themselves as well as the universities, young people who have just missed out on their university course of choice would know there was an alternative, and a good one."

(The Australian, 18/1/2003)

Read the editorial

The demise of Journalism at the University of Queensland

Journalism education in Australia took a huge backward step when the University of Queensland forced a merger between the Department of Journalism and communication studies as well as public relations. The move was opposed by journalism students, teachers and industry advisers who sought to preserve the integrity and standards of professional journalism education at the university. Foundation Professor of Journalism and the last head of the Journalism Department, Professor John Henningham, spoke against the amalgamation and predicted the decline of journalism at the university: John Henningham's address to Academic Board. (Henningham was the University of Queensland's (and Australia's) first PhD in Journalism and the first person in Australia to be appointed Professor of Journalism. He is credited with the establishment of Journalism as a university department at UQ in 1990: it had previously been a sub-section of the Department of Government.)

Subsequently, an outburst of dissent from current students has shown that the concerns of John Henningham and his colleagues and students in 2000 were well-founded: See Students' blogspot 1 and Students' blogspot 2