Plus subprime student debt
and teaching and equity to lose in the budget
The great Australian education media tradition of breaking international embargos on university rankings continued yesterday. Fairfax’s Brisbane Times went 24 hours early with the Times Higher “150 universities under 50.” It was an easy mistake to make, with daylight saving over the journalist obviously just thought that the rest of the world is now on the same time as Queensland.
Now that the THE rankings (above) are public, hooray for the 19 Australian universities that made the cut, especially the first ten who cracked the first 50, UTS (21) QUT (28), Charles Darwin (31), Uni Wollongong (37), James Cook U (38), Flinders U (46), Griffith U (48) and Deakin U (50). Flinders U did particularly well, jumping from 77th last year, as did La Trobe U moving up from 75th to 58th. However Western Sydney U fell from 56th in 2015 to equal 86th this year, Curtin dropped ten places to 92 and Murdoch U declined from 65 to 82.
Overall Australia rates number two in the world, behind the UK with 25. Ominously for Australia however, four of the global top ten are in Asia; Nanyang Technological University (Singapore) is second, Hong Kong University of Science and Technology is third, Pohang University of Science and Technology (Korea) is fifth and the Korea Institute of Science and Technology is sixth.
Does any of this matter? Being founded 50 years ago or less is hardly a defining quality, unless of course your university made it on the list, and then it matters a great deal.
Outside the goat cheese belt
Thanks to a reader for pointing out the Melbourne Centre for the Study of Higher Education is offering a short course on field skills for researchers in “less secure, complex and/or hostile environments” with a “practical component” at the university’s Dookie campus (in the Goulburn Valley). The university describes it as “in a peaceful setting isolated from the bustle of everyday life,” which must sound like hell to researchers who are particular about their coffee.
Shergold stays at WSU
Peter Shergold will continue as chancellor of Western Sydney University for a further four years, extending his term until 2020. The university’s Board of Trustees made the expected decision yesterday. Former PwC partner Elizabeth Dibbs becomes deputy chancellor, replacing Gillian Shandwick, who is retiring.
Professor Shergold became chancellor in 2011, replacing former Reserve Bank deputy governor, the late John Phillips.
Keeping uni entry honest
Professor Shergold is also busy as chair of the Higher Education Standards Panel, delivering on Education Minister Simon Birmingham’s commitment to transparent university entry scores (Campus Morning Mail February 10). A new HESP discussion paper sets out what it wants:
“A guide to admissions policies and student enrolments should be made available through a single online platform for ease of access
Universities Australia and other higher education peak bodies should publicly support clarity on how ATARs scores are used and the manner in which alternative admissions pathways and policies are applied.
It should be made clear that ATAR thresholds do not operate as a strict ‘cut-off’; that thresholds generally apply to (bonus point) adjusted ATARs; and that prior year ATAR thresholds are provided only as a guide to prospective students.
Higher education institutions should be held accountable for public claims against their stated entry policies.”
Hard to argue with.
Now who would have tipped off The Australian’s David Crowe about the Parliamentary Budget Office’s report on student debt, released yesterday? How about anybody interested in softening the electorate up for a rise in HECS HELP contributions in the budget. The PBO certainly set out some scary numbers on the size of the loans and the cost of the programme. Of course the paper assumes the government’s proposed cut in university funding, to be replaced by a hike in fees will occur but even with this expansive assumption there is a bunch of billions in red ink. The programme cost (bad debts, plus interest rate subsidy – the difference between CPI charged on loans and the Commonwealth’s borrowing rate) will grow from $1.7bn this year to $11.1bn in a decade. By then the HELP loan portfolio (including VET student debt) will have a nominal value of $185bn but the PBO estimates its market value will be $50bn less. And how’s this one; “the proportion of Australian Government public debt interest required to finance outstanding HELP loans is projected to increase from 15.4 per cent in 2015-16 to 46.3 per cent in 2025-26.
No wonder then that Education Minister Simon Birmingham warns that it can’t go on; “there are real sustainability pressures in the higher education budget. Projections show that costs will continue to increase dramatically and the Turnbull Government acknowledges that we must ensure the higher education system is sustainable for all those generations of students yet to come,” he says. But how to stop it? Senator Birmingham will be glad if you ask that. He is already hinting at an increase in student contribution to course cuts, to 50 per cent and the learned Andrew Norton has made the case for reducing the repayment threshold from $54 000 in annual income now to $42 000.
And there is still the possibility of cutting government teaching funding and allowing universities to set their own fees (as per the Pyne proposal) – although this is less unlikely than impossible without a radical change to Senate membership. However the National Tertiary Education Union warns that if “the amount of money that the government spends on subsidising student loans would overtake the amount of money they give universities to educate students through the commonwealth grants scheme … HELP could become Australia’s own “subprime crisis”.
Conor King from the Innovative Research Universities was even more moderate. “The government’s proposed Commonwealth Grant Scheme cuts are the main driver of the apparent blow out in cost of HELP. This is because the report tests variation is how universities could use fee flexibility to conclude that those increases don’t matter much. … it is the recovery of the government saving to the CGS that drives the rapid growth in expense to government.”
The policy options are fiendishly complex but the message the government wants us to here is quiet simple – while demand driven funding should continue graduates will have to pay for more of their own study.
Cuts to count on
Christopher Pyne’s 20 per cent cut to university funding, to be made up from student fee increases, is still government policy but CMM will run round your chancellery of choice blowing a bugle if it actually happens without a much more sympathetic Senate.*
But there is no doubting Education Minister Simon Birmingham will have to provide some budget cuts to avoid the wrath of Finance and Treasury. With research infrastructure and demand driven funding guaranteed, cuts can only come from programmes that are not protected by parliamentary process.
Programmes, CMM suspects, like the Higher Education Partnerships and Participation Programme and the Office of Learning and Teaching. The former was supposed to spend $155m this year (less a cut at Christmas via MYEFO) and the OLT spends $28m or so. Not deficit busting amounts but certainly a contribution to what is now called “budget repair.”
OLT is an easy cut, for a start outside the education establishment it is all but invisible and the government has already arranged for it to disappear. It is supposed to be replaced by a university-based National Institute for Learning and Teaching, directions for which were set out in a paper by Ross Milbourne (CMM October 7). But although it is supposed to start in July there is no sign of a hosting university being appointed.
As to HEPPP, the government has tinkered with equity programmes since it was elected (CMM June 26 2014) and it would not be hard to use demand driven funding as cover for cutting access programmes. Senator Birmingham has also talked about measures to reduce attrition.
No, these are not big savings, but they are relative painless politically – and the last thing the government will want with an election imminent is another “$100k degree” campaign.
*As to the bugle, conditions apply
Liverpool FC is establishing a coaching programme in Lismore, at Southern Cross University’s Football Centre, apparently to benefit from SCU’s “recognised expertise across the health and sports disciplines.” Liverpool FC isn’t the only European soccer powerhouse investing in Australia. Real Madrid has a coaching clinic programme with Victoria University and an MBA in sports administration with Adelaide based Torrens U (CMM July 29 2015).