Squiz Today – Tuesday, 2 May

UNI STUDENTS TO FACE HIGHER COSTS

THE SQUIZ
Education Minister Simon Birmingham spoke last night to the higher education sector about changes to government funding contained in next week's the budget. From January next year, funding to universities will be reduced by a 2.5% efficiency dividend (saving the government $2.8 billion over four years) and students will be asked to contribute between $2,000 and $3,600 more for their degree.  Taxpayers will still cover the majority of the cost of a degree. The changes are not as dramatic as the doomsday scenarists had predicted (off the back of what the Abbott government had previously proposed), but they are significant changes nonetheless.

BUT A CUT IS A CUT, RIGHT?
You won’t get any of that fancy spin-talk here. So, of course, that’s right. For context, the government says please consider this:

- They won’t deregulate uni fees. This was the position outlined in the first Abbott budget in 2014 (along with a 20% cut in funding), but this is off the table. 

- Costs to the uni sector between 2010 and 2015 have gone up by 9.5%, but government funding has gone up by 15%.

- Australia’s HELP scheme (modern day HECS) currently has a repayment threshold of $55,000. In New Zealand it’s $19,000 and UK is $30,000. So the government will lower the threshold to $42,000.

- In 2015 the government had $48 billion of student debt on its books, with predictions 25% of that will never be repaid.

- Nine of the 38 university leaders are paid more than $1 million.

What the government is essentially saying is the sector can handle a funding cut, and students should contribute more to the cost of their education. 

WHAT’S THE REACTION BEEN?
In a word, hostile. The universities said they were surprised the government thinks they can shoulder the funding cuts. Labor said the government is out of touch. And the National Union of Students accused the government of performing a reverse Robin Hood. This was the government reason to get the news out ahead of the budget, and to give the minister a chance to explain the changes. That theory assumes there is some good news in the budget they want to highlight. Or maybe it’s a case of ‘less bad’ news they want to showcase…

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