Watching Australia's fee fracas

September 4, 1998

It was going to be a proud day for Australian universities. Our very own student funding system, the Higher Education Contribution Scheme, was supposed to herald a new age in British higher education. Then politics entered into it.

Now the United Kingdom has a new funding policy few want and even fewer understand in a perfect example of just how awry government reviews of higher education can go.

The tales of Ron Dearing and Rod West are eerily familiar. Lord Dearing was appointed to head a review of higher education in the UK in 1995; West was named chair of the Australian equivalent in 1996. Both men were asked to find solutions for rapidly growing university sectors and shrinking government money, and when they did so, both were rudely awakened to electoral realities. Both made the same mistake. They assumed their respective governments would see the wisdom in greater deregulation for universities and be prepared to weather a few storms in order to get there.

A close observer of both Lord Dearing and Mr West was Nicholas Barr of the London School of Economics. He travelled between the UK and Australia to advise both review committees.

Now that the results of years of work and millions of dollars and pounds have been laid out before unwilling parliaments and even less enthusiastic student bodies, Dr Barr has come to a conclusion. If he was ever asked to chair a committee of this sort, he would insist on having access to the Prime Minister and his own public relations expert. Otherwise things are bound to get bogged down in political mud.

The introduction of HECS in Australia almost a decade ago saw the end of free education and a massive expansion of the system funded partly through a student contribution of about 25 per cent of their degree cost via an income-contingent loan.

With British universities still struggling within the confines of a taxpayer-funded system, Lord Dearing proposed this form of HECS as the fairest way to fund expansion - not that HECS is considered entirely fair in Australia any more.

In 1996, within months of the Liberal-National coalition government getting into office, Amanda Vanstone, the then education minister, more than doubled the HECS fee for courses such as law and medicine and lowered the income threshold at which all students were required to start repaying their loans. The impact of these changes not only eventually saw her lose the ministry but, when combined with a funding cut of Aus$623 million to university operating grants, has been one of the biggest blotches on the government's political record.

Indeed, it is difficult for Australia to hold up HECS as a successful example of funding reform now that it has been so radically reshaped. And depending on the success of Mr West's review, which proposes student-centred - or voucher - funding, HECS may be dismantled entirely as Australian universities enter a whole new age.

Lord Dearing has a warm personal regard for Mr West. They conferred at length about their respective tasks and have closely read each other's reviews. Both share the singe marks from their respective governments. West has yet to face an official response to his Learning for Life paper. His voucher proposal is certain to entice Senator Vanstone's replacement, David Kemp, but whether the government will risk inevitable public outrage is another matter.

It is also a possibility that Mr West's review may be dealt with by a new Australian Labor government following what promises to be a very close federal election. Labor's tough stance on vouchers, however, may last as long as the Blair government's commitment to "no fees".

In contrast to Mr West, the British government was immediate in its verdict of Dearing, announcing it would "build" on Lord Dearing's recommendations, which meant changing the central tenet of the proposed tuition fee from the HECS model to a means-tested up-front amount. Lord Dearing concedes that while it is not what he recommended, the new policy is an informed change of principle from a government with a party manifesto which has always opposed fees.

Dr Barr, who has long advocated the fairness of a system like HECS in which no one has to pay until they are earning above a set income, and which redistributes wealth from today's middle class to tomorrow's poor, sees the new system as a dog's dinner and inimical to access.

Clearly expecting a student uproar similar to the response to HECS in Australia, the Blair government has made much of its concession that poor students will not pay a tuition fee at all. But according to one of the architects of HECS, the University of Canberra's deputy vice-chancellor Meredith Edwards, one of the main philosophical arguments behind HECS was that any student who received a university degree would have better employment prospects than a non-graduate and should therefore help pay for that advantage, irrespective of background. More importantly, no student should be required to pay an up-front amount - a requirement Professor Edwards sees as the biggest threat to access and equity.

While there has been a furious debate about impediments to access under the Vanstone changes to HECS, the scheme in its original form did not affect the entry levels of students from low socio-economic backgrounds.

Professor Edwards addressed the Committee of Vice-Chancellors and Principals late last year on the track record of HECS in Australia and its possible applications in Britain. She is deeply disappointed with the new policy. While commending Lord Dearing's appreciation of the scheme, she said he was derailed by a government that fundamentally misunderstood the purpose of HECS and lacked the fortitude to push such a major reform through.

While Lord Dearing proposed a whole lot more than just a tuition fee and Mr West proposed more than just vouchers, the fee has well and truly taken over the agenda, for the time being.

Meanwhile Lord Dearing will be in contact with Mr West as the Australian government decides its latest university funding agenda. While Lord Dearing sees the West review as more radical than his own, he also sees it as a logical progression for Australia. He has certainly been placed on the shelf for the moment. But when the review is finally dealt with, the UK will be watching closely.

Emma Macdonald is education reporter for The Canberra Times. She travelled to Britain to study higher education funding issues as the winner of the inaugural John Douglas Pringle UK Prize for Journalism.

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