Australian government has no modelling on effect of university fee hikes, official reveals | Australian universities


Education department officials have revealed the government has no modelling about whether university funding changes will incentivise students to study science instead of humanities, the rationale for fee hikes provided by Dan Tehan.

The department’s deputy secretary of higher education, Rob Heferen, told the Covid-19 inquiry on Tuesday fee changes had produced “muted” results in the past and declined to answer questions about why the price of some courses such as social work will be increased by 113%.

On Tuesday the regional education minister, Andrew Gee, also promised that “serious consideration” will have to be given to cutting course fees for social work, behavioural studies and psychology over fears fee hikes will harm the workforce in regional areas.

Tehan unveiled the jobs-ready graduate package in June, proposing to reduce the overall government contribution to degrees from 58% to 52% and increase fees for some courses to pay for 39,000 extra university places.

The National Tertiary Education Union national research officer, Terri McDonald, told the Senate committee the package “does nothing to address the problems of the sector”, which is projecting cumulative losses of $16bn by 2023.

By trying to “fit more students into the system with less money per student” the package “actually creates more problems for us”, she said.

McDonald argued the government “wants to send price signals within a system built to ignore price signals” – because students take out loans that are not repaid for years – and the package produces “odd” incentives.

McDonald noted that although the package would make courses such as science and engineering cheaper it would reduce the government contribution for universities to teach those subjects, whereas humanities and law course fees will increase.

“So the incentive for universities is to boost [student] numbers in areas the government says it doesn’t want people to do to cover shortfalls in areas which are more resource-intensive [such as science].”

Helen Cavanagh, Charles Sturt University’s deputy vice-chancellor, told the committee it was “highly unlikely” a prospective student wanting to study social sciences would instead study science, technology, engineering or maths because they don’t think about their student debt.

Cavanagh said the package would have “unintended consequences” by making social work degrees more expensive, reducing the potential workforce for roles “important to regional Australia” such as child protection officers and psychologists.

Asked what the logic was behind increased fees for courses such as social work, Heferen replied “that’s a question of policy”, invoking that explanation at least four times and offering to take the question on notice and ask Tehan.

Heferen said fee increases and cuts were guided by the desire to better match fees with the cost of providing courses, but said the split between the commonwealth contribution and student was decided by the minister.

Heferen said the policy was “an attempt to make some courses more attractive” in areas of predicted workforce shortages.

“Whether universities and students will do that is a very hard thing to predict. Previously when [course fees have] changed, the response from students has been pretty muted.”

Heferen said that “definitely some” prospective students will consider financial incentives but as to “how many” he confessed “we don’t know”.

He suggested the impact might be greater than past changes because the fee changes are larger but there is “no reliable information about elasticities of an 18 year old thinking about a debt liability they might pay back when they’re 35”.

Heferen took on notice whether the department had recommended the reforms to the minister.

Departmental witnesses also struggled to explain Tehan’s claim that the Tertiary Education Quality and Standards Agency’s integrity unit could police enrolment shifts as he defended the policy against vice-chancellors warning of perverse incentives.

Tehan told the Australian the unit could “investigate substantial shifts in enrolment patterns at universities and consider the implications for educational quality and provider governance”, in a move that blindsided the sector.

Dom English, the first assistant secretary of higher education, suggested the comments had been “exaggerated in the media” and all Tehan had done was observe the Teqsa unit “will look at enrolment patterns”.

Despite significant benefits for regional universities – including growth in places of 3.5% – the package has nevertheless caused concern that a $5,000 payment for regional students will create a perverse incentive to move to the city for university.

Gee has acknowledged there is “a maldistribution of social, mental and community health workers between the cities and country communities” and said consultation with regional vice-chancellors “will play a crucial role in informing the Nationals’ party position on the proposed tertiary education reforms”.



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