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Job-ready Graduates Package inequitable and just poor economics

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Caricature courtesy Bruce Keogh / keoghcartoons.com.au

A fossick into the Coalition's new university fees policy reveals a schedule increasingly onerous for students, inconsistent in government contributions, shallow in economic rationales and not serious about equity issues.   

Let’s scratch around in Education Minister Dan Tehan’s 2021 university funding or “Job-ready Graduates Package” — another riff on the facile Scott Morrison “Jobs R Us” approach to pretty much everything.

This package tabulates current and proposed, government and student contributions, for 22 fields of tertiary study.

In most fields, the government contributes $13,500 or $16,500 a year, with four outliers on $1,100, and four on $27,000. In most fields, students chip in $7,700, $11,300, or the brand-new high of $14,500. Seven outliers go to a brand-new low of $3,700, supposedly based on 'private returns and national priorities'.   

The Minister and the Education Department offer various alibis for their contributions mash-up including that:

  • student fees are still reasonable;
  • combined course contributions better match course costs; 
  • degrees in higher “growth” areas deserve lower fees; and 
  • the package includes disadvantage measures.

Student fees are onerous, in the current national situation

The Minister says (local) students will pay less than they do in “similar” countries like the U.S. and the UK. Now more than ever, who wants to be compared with those coronavirus-infected nations?

Australia’s extended border closures lay bare the Coalition’s repetitively optimistic forecasts, with GDP “growth” radically reliant on migration and population growth.  

A recession with high unemployment is a tough time to saddle local youth with up to $23,100-43,500 for a three-year degree and $30,800-58,000 for four years.

Not what mildly egalitarian European nations would do. For locals, even internationals in some cases, they still offer low-fee or free degrees. Quaintly, they perceive education as something of a basic human right, or equality marker. Rather than a pricey private investment, or market commodity.

Glossing the economic train-wreck, the Education Minister claims 60% of students will pay the same or lower fees. While eligible students access the oxymoronic “world-leading” income-contingent loan scheme.

Yet it appears students will now cover even more of overall course costs.

Uneven government v student course contributions 

The second alibi, according to Tehan is that total (government plus student) funding will better match “contemporary” delivery costs, in each field. Satisfying stuff — for bean-counters.     

In most fields, the government picks up more of the total costs. In just a few, the student. According to Tehan, the student contribution for law and commerce will increase by 28% and for the humanities by 113%. But those domains aren’t really comparable. Only the first two are well-trodden avenues to higher “private returns”.

Why hoist humanities (or communications) to $14,500 student contribution, with only $1,100 government top-up? As English and languages plummet to $3,700, with $13,500 and $16,500, respectively, from the government. Surely the last two aren’t vastly more costly to deliver, or crucially larger “national priorities”.  

Perhaps Tehan doesn’t want students to miss out on language study? As he did. The predictable outrage over humanities is a bonus.

Shallow rationales for lower v higher student contributions

Tehan’s key alibi is lower student contributions, in predicted areas of employment “growth”. He settles on health, science and technology, education, and construction.

This early into COVID-19, why base policy intricacies on what 73 professors call "untenable assumptions" about future industry-growth patterns?

Nevertheless, courses in Tehan growth-areas go “cheaper” because the Government wants the "best outcomes" for the broader public. Because the Department guards over “private returns" and "national priorities”.

As the professors retort, increasingly differentiated student contributions teem with “unintended consequences”. In crude paraphrase, universities suddenly shriven of colossal overseas-student revenues will game the system more than usual.

The Department soldiers on:

“Teachers, nurses, engineers, scientists—these are the workers our economy needs—will see significantly lower student contributions.”

Indeed, nursing nearly halves, to $3,700 annually. Different story elsewhere in the health industry. 

“Allied health” and “other health” are still $7,700. The prized medical, dental and vet science courses drop $55, to $11,300. Enough for a couple of ales at the uni bar.

These days, medicine is more open. But the entitled kids still have the inside run.

Science (also environmental studies) and engineering student contributions are still sizable, at $7,700. And the Government is cutting its contributions to all three.  

As we’re “looking over there” at nursing, Tehan also discounts teaching, agriculture, mathematics and clinical psychology — to the bargain-basement $3,700 category.

These disciplines will perhaps train the “workers” we “need”. But why position the last three science-related on half the student contributions of six other science-related courses?     

Package shirks social mobility and private reward issues

Tehan promises a “regional education commissioner” with “$500 million a year to universities to support Indigenous, regional and low socio-economic students”. On less than 5% of Federal university funding, the commissioner won’t jolt inequalities of learning opportunity. He’s a band-aid over big schooling disparities. 

Compare us with socially-mobile Finland — strangely reluctant to emulate our world-leading divisive and discriminatory school system. Like other Finnish degrees, teaching doesn’t rack up student fees. Entry is keenly sought, though other professions earn more

Personable Gonski Institute import Pasi Sahlberg told the ABC he couldn’t get a Finnish teaching guernsey in his younger days.  

In aspirational Australia, plush parents won’t hurry heirs, into the $3,700 disciplines. They know the best loot’s elsewhere.

Here’s where the package excels, if you’re unfussed by floundering social mobility, or, as the professors put it,

'...different pricing of subjects works against social equity.'

In equity terms, graduate starting salaries say little. Novice nurse and teacher salaries are competitive. More telling are (private sector) occupational earnings. Three years after graduation, medicine, dentistry, engineering and law have already jumped ahead.

Then really lucrative careers cluster in law, business and finance, medicine and engineering. Despite Malcolm Turnbull’s cautionary tale, lucky graduates can glom eye-watering loot. No surprise, students heft big contributions for these types of degrees. Law and economics, also management and commerce, go onto $14,500 annually. At $11,300 and $7,700 per annum, medicine, dentistry and engineering are still substantial. 

Chump change, in well-heeled households. Tougher ask, for ordinary families and students.

Maybe it doesn’t matter. Two-fifths of school-leavers already attend university. “World-leading” loans, so they say, neutralise big tickets on desirable degrees. Debates about elite students, they also say, are “stale”. After all, none of us likes the “politics of envy”.

Or maybe it does matter. With easy access to the vastly better resources of private (usually denominational) schools, children of managers and professionals are still much more likely to reach university than working-class kids. They’re groomed for the prestige institutions and lucrative degrees that generally require higher ATAR scores. 

When Scott Morrison says “too many” kids do uni, more should “aspire” to trades, that wouldn’t resonate in Double Bay or Toorak.  

While Australian women (especially private school alumnae) keep on acing university entry, then, as graduates, earn much less than the men. You guessed it, a lot of them do nursing and teaching. Tehan’s discount courses. 

More than likely, the traditionally lucrative degrees will still offer solid earnings premiums. Other COVID-era graduates – Tehan patronises them as the “Costello Baby Boom” generation – might be in hock for a while. Fortunately, no $100,000 degrees. Not just yet...

It's less than likely, that Tehan will agree to “shelve” legislation for the package as the professors suggest. Let’s hope the parliamentary deliberations instil more consistency and fairness.

Stephen Saunders is a former public servant, consultant and Canberra Times reviewer. 

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