Unis to be slugged for student loan admin costs

The bite is on: The government’s budget proposal to slug universities for the feds administering student loan schemes has got the nod from Labor. Opposition members of a Senate committee will not oppose the bills, basically because the very few millions of dollars ($3-4m) involved will not matter after the next election; “in the context of our policies to properly fund the sector.”
But the legislation still upsets: The Group of Eight’s Vicki Thomson calls them, “demonstrably pernicious policy … a tax on public institutions dressed up as recouping administrative costs” (CMM November 12). And on Friday, Universities Australia warned, ““universities are now being asked to pick up the tab for day-to-day administrative costs that are the normal responsibilities of government.”

However, once the comrade senators’ position was plain, the ever-pragmatics Innovative Research Universities announced  Friday it would accept the inevitable but that the government should properly pay universities, “for the benefit of assisting the government implement its programmes for students.” A point politely considered in the Parliamentary Library’s  analysis ;

“There appears to be little precedent to draw on to evaluate the proposition that ongoing administration of HELP is a regulatory activity for higher education providers. …To the extent that government deals directly with students to administer the program, it is not clear that higher education providers should be liable for this cost.”

Beyond principle there are practicalities. A couple of weeks back the Department of Education and Training quietly released a discussion paper on how it proposed to bill higher education providers for loan administration, down to charging for admin assistant hours and stating that it will change fees in line with costs (CMM November 15). As Universities Australia CEO Catriona Jackson puts it, ““this legislation also empowers the minister to ratchet up the tax at any time and to broaden the activities it applies to — without needing to seek permission from the parliament.”  This will not end at all well for university budgets


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