The 1974 question

THE vice-chancellors of Melbourne and La Trobe universities recently noted that it is no small achievement for the often divided tertiary education sector to unite around major reform.

For Education Minister Christopher Pyne to have gained the support for the essentials of his reforms from all but one university is no small achievement; it is remarkable.

When I worked in academe two seemingly unrelated things never failed to amaze me. The first was how excruciatingly difficult it was to get academics to agree on even minor issues, let alone government policy — rather like herding cats with little tweed coats. The second was that working as an academic would automatically generate the gibe that you did not live in the real world.

Ironically, the reason there is now such strong consensus behind support for the Coalition’s reform package is that university leaders are facing head-on the real-world environment of present times.
They know there is a 1974 question and a 2014 question.

For several decades the debate about reform was dominated by the 1974 question, which was essentially about equity. Could Australia encourage a greater percentage of students from low-income backgrounds into higher education by providing degrees free to students, but at a very high cost to taxpayers?

For decades the equity question was a logical inquiry for two reasons. First, between the 1970s and the 90s we did not have good data to provide an answer to this important question. And across the same three decades the higher education sector was essentially an island existing in a comparatively stable global market.

In short, it made some sense to ask the equity question when we did not know the answer and when there was not much else to worry about. To keep asking the same question 40 years later makes much less sense because we worked out the answer at the same time the global tertiary education market took off around us.
Multiple authoritative data-based reviews have unequivocally and empirically answered the equity question. The 1989 shift from free degrees to deferred fees did not decrease the percentage of low-income students.

No one particularly likes paying more for something (even if it is fair to do so) but this does not detract from another fact: that expanding the share of the fees students are required to pay does not decrease the percentage of low-income students in tertiary education. The introduction of HECS in 1989 led to a dramatic increase in total student numbers, including in the low-income category.

During the 90s, HECS repayments went up nearly eightfold to $900 million — and even as fees and repayments went up, so did participation, with enrolments growing by 30 per cent between the late 80s and 2000. From the end of free tertiary education throughout the period of increasing student contributions, the percentage of low-income students remained remarkably steady.

In fact, the evidence suggests that Pyne’s reforms to extend student loans to sub-bachelor degree courses, to deregulate degree fees and provide more scholarships will increase low-income student participation. This is because fees are not the real determinants of participation; rather, it’s social conditions, parental expectations and pre-tertiary preparation.

At about the same time we concluded the answer to the equity question, the conditions that had long prevailed in education markets began to rapidly break down and a new question emerged.
The 2014 question is more existential: how do universities maintain their status as quality institutions and remain internationally competitive in a rapidly changing global market?

From the late 90s the quantity and quality of Asian universities has increased at astounding speed and the number of students who now move from nation to nation to pursue tertiary education has similarly risen in astonishing numbers. Five years ago, there were no Chinese universities in the world’s top 200 as measured in academic rankings. Today there are six.

As students now travel internationally to get education, the Australian tertiary sector is our third major export industry, representing about $15 billion in export earnings. Unlike 1974, in the real world of 2014 tertiary education has become a globally traded commodity in which there is rapidly intensifying global competition.

In the real world of 2014 something happens if we do nothing but romanticise the Whitlam era of free education instead of engaging in substantive reform. In the face of intense global competition for students and for quality academics, Labor is opposing critical reform supported by the universities themselves. Universities will not price themselves out of the market and Labor’s nonsense campaign about the future cost of degrees has been properly described as wrong and shameful. Disingenuously scaring people by exaggerating future degree costs and chanting motherhood statements that education is a right, not a privilege, does nothing to address the real-world threats faced by universities.

The present situation merely demonstrates that, just as the academic leadership of universities wisely faces the realities of 2014, another group has taken the place of retreat away from reality: the Labor Party.