SUBMISSION

to

Senate Employment, Workplace Relations and Education References Committee

Inquiry into higher education funding and regulatory legislation

Submission no:	331

Received:		15/8/03

Submitter:		Presented by:
			Myra Robinson, President
			Susie Byers, Education Council President
			Stewart Ford, Postgraduate Students Association President

			Prepared by:
			Arnold Lee, Projects Officer

Organisation:		The University of Western Australia Student Guild

Address:		35 Stirling Highway
			Nedlands, 
WA 6009

Phone:			08 9380 3762

Fax:			08 9380 1041

Email:			projects@guild.uwa.edu.au

To the Senate Employment, Workplace Relations and Education Reference Committee, the UWA Student Guild tenders this submission to the inquiry into higher education funding a regulatory legislation.  We wish to make the following points;
•	That higher education, as acknowledged over past inquiries, is in crisis;
•	That the higher education policies enacted have failed to address this crisis and have resulted in the sector becoming focused on income generation rather than the promotion of meritorious teaching and research;
•	That the burden of the cost of education has been shifted to students through increasing fees, and to universities who are being forced to do more with less;
•	That the current proposals put forward by the Government do not address the current problems, and if they were to be enacted would destroy the principles of academic merit, equitable and accessible education, and that of academic freedom;
•	That aspects of the package as it stands, aim to further the Government’s political agenda and done very little to address the problems within the sector;
•	That if the issues that are facing higher education are not addressed Australia face the prospect of losing standing among international universities.
This submission shall address the terms of reference provided by the inquiry and put forward the case, as the UWA Student Guild sees it, that there is need for drastic changes to address the current crisis in higher education.  This submission does not aim to present the various reports and data that is available around these issues.  Rather this submission aims to bring to the attention of the Committee what the UWA Student Guild sees as the problems associated with the proposals outlined in ‘Backing Australia’s Future’.
1. The principles of the Government’s higher education package.
The Government’s higher education package, ‘Backing Australia’s Future’ released with the 2003 budget is in line with the policies that the Howard Government has tried to introduce to the higher education sector for some time.  The Government has taken a consistent stance that  private gain of education to the individual outweighs the public good  of having an educated society.
The Howard Government oversaw the biggest cuts to higher education in Australia’s history in 1996.  These cuts were the beginning of a concerted campaign to bring in an agenda of greater private investment in higher education and the withdrawal of the Commonwealth from the responsibilities of educating the nation with $5 billion cut from higher education since 1996.  At this time the Government indicated its desire to start charging students more by the introduction of differential HECS.  This saw the introduction of a three banded HECS system which aimed more at the projected income of graduates than the actual costs to educate them.  This has led to such discrepancies as Law degrees being put into the top band of HECS and students studying Law contributing up to 81% of their course costs.  
This agenda became clearer with the subsequent leaking and withdrawal of the 1999 Kemp package for higher education.  This package is similar to the current proposals, with the emphasis on private debt rather than public investment into education.  University governance, such as the representation of student views through university governing authorities were to be eroded through measures such as Voluntary Student Unionism.  Also, the introduction of student loans at real rates of interest was first mooted. 
The current package contains all of these elements and then some.  ‘Backing Australia’s Future’ represents an agenda set on dismantling the current framework of public education.  The Government argues that the private benefit derived from receiving a university education is reason enough to shift the focus from public investment in education to a  system that engenders private debt.  The subsidisation of university places through the HECS system would be shifted, allowing universities to set their own fees and the provision of places at university be based upon the individuals ability to pay, or willingness to take on high levels of debt.
This shifting of emphasis is done by giving universities little choice but to increase their tuition fees by up to 30% or through accepting domestic full fee students.  The compulsion to do this comes from the dismantling of the block grant system currently in place and replacing with the Commonwealth Grant Scheme.  This Scheme will determine how many subsidised places each university will receive, what their degree mix will be and remove the current marginal funding for over enrolments.  However, universities will be responsible for finding the funds to cover the gap between their Commonwealth Grant and the actual cost to run the course and will see a shrinking of the number of places through the removal of the marginal funding.
The package also looks at the ways that universities are run.  The Government sees fit to push universities to the boardroom through offering extra funding to universities who change their governance structures.  The Government views the interests of staff and students alike as ‘sectional interests’ despite the fact that these views are expressed by those who are elected by their peers into these positions.
This attack on governance is extended to the attachment of Voluntary Student Unionism to the package.  Student organisations play an important role within universities and are part of the governance structure.  Student organisations play an important role in campus culture, providing activities, representational, welfare and services to students and the wider community.  It is with interest that it is noted that this will be put to the Parliament as a separate piece of legislation from the rest of the proposals in Backing Australia’s Future.
Likewise, the industrial agenda of the Government is furthered by Backing Australia’s Future through the pegging of extra funding to higher education institutions that will shift staff to Australian Workplace Agreements.  In addition to this, the Government is seeking to take away the fundamental industrial rights of staff through their proposed amendments to the Workplace Relations Act (1996) to remove the right to take legitimate action in the face of wage disputes.
The Government seeks to address shortfalls within the employment market through the National Priorities initiatives as well as through seeking opportunities presented through research.  The measures outlined in the package do not address the underlying problems that have caused these problems to emerge and so this band aid approach will not remedy them in the long term.
2. The effect of these proposals upon sustainability, quality, equity and diversity in teaching and research at universities, with particular reference to:
a. The financial impact on students, including merit selection, income support and international comparisons
For students the Backing Australia’s Future paper as it stands, signifies a considerable shift in the means by which they will make the choices that will effect their, as well as Australia’s future.  Under the current arrangements, if an individual meets the prerequisites to enter into a particular stream of study, be it through TER or other tested means of entry, they are eligible to enter this stream. 
The introduction of the Higher Education Contribution Scheme (HECS) in 1989 saw an increase in the general levels of participation in the university system.  When first introduced, HECS was seen as an equitable means to bring about this greater participation.  The system of HECS put into place had a common cost across all courses and the repayment threshold was set $22, 000.  The introduction of the scheme saw an increase in the level of enrolments to universities.
1997 saw the introduction of Differential HECS.  This change to the HECS system saw the splitting of the various degree streams and the first indication that costs were to be worked out on the basis of the ability to pay.  Evidence of this is the inclusion of Law in Band 3 of the new system, meaning that Law students are now paying 81% of the cost of their degree, whilst similar courses in the humanities only attract a band 1 cost.  
The other major change was the lowering of the repayment threshold to         $20, 701 from the previous year’s figure of $28, 495.  The consequence of this was a fall in the level of participation in higher education across some groups, most notably low SES background school leavers and mature aged students.  The overall impact is that the increase in fees has deterred those people that the originator of HECS had hoped to encourage to enter tertiary education.  Within Backing Australia’s Future, the HECS repayment threshold is to be increased to $30, 000.  Although this is move welcomed by the UWA Student Guild. $30, 000 is not good enough.  $35,000 is the average starting wage for a graduate, and the point at which there is private benefit and as such the repayment threshold should be raised to this level.  However, the Guild does not support the lowering of the discounts for early and upfront payments.  Students who can afford to pay upfront should not be advantaged by paying lower fees.  The Guild would like clarification as to what the repayment percentages will be under the new regime. 
One of the key features of the proposals is the move towards further increasing the level of contributions by students towards the cost of their education.  This is through the proposals to allow universities to increase the cost of a degree by up to 30% above the current HECS levels and through the increase of the quota of domestic full fee paying students to 50% of a course from the current 25%.  Sydney University has already passed a motion in its University Senate to allow this 30% increase in HECS fees with a number of universities set to follow.  UWA has not made its position clear, stating that the issue is one of quality and not cost.  
This move away from merit selection and a focus on the ability to cover costs, be it through the predicted income that will be earned upon graduation or as a domestic full fee paying student, means that there is further impediment to an equitable and accessible education system.  Students from low SES backgrounds, as well as mature-aged will be disinclined to follow the education path that they desire.  Rather they will be more likely to consider paths that are less expensive or are likely to give them the greatest economic return to be able to cover the costs of their education.  This seems to defeat the Governments stated aim of in their  education package, to make graduates more responsive to the needs of industry and the job market.
The introduction of the Higher Education Loans Programme (HELP) will mean that there will be the danger of increasing the debts that students will carry throughout their lives.  HELP consists of three differing components.  HECS-HELP will provide a loan to cover the costs of a subsidised university place.  FEE-HELP is available to students who take on a full fee paying place.  The Postgraduate Education Loans Scheme is to be scraped, with postgraduate students now receiving their assistance through FEE-HELP.  FEE-HELP is capped at $50, 000 and will attract a 3.5% rate of interest above the CPI.  OS-HELP is provided to students who want to study overseas for a short period of time.
Despite government assurances that HELP will provide greater flexibility and promote lifelong learning the system represents a number of problems.  For students who take a domestic full fee paying position the provision of FEE-HELP will mean that those willing to take on debt will be able to enter university despite not meeting the entry requirements.  
Currently some universities allow domestic full fee paying students to enter with TER marks 20 points below their minimum standard.  There are no measures in place to stop this figure from falling even further.  
Likewise, students who find themselves in the position where they are no longer on a subsidised place will have little option but to take a FEE-HELP loan to complete their qualification.  This will include those students who take on postgraduate study.  As FEE-HELP attracts interest, and any HECS-HELP loan is required to be repaid first, these students will be amassing an even larger debt due to the operation of compound interest.  This is especially the case for postgraduate students, who will have already amassed a HECS debt through their undergraduate study.  An additional concern with the effects of debt is the inequity faced by women in the repaying the debt.  Women earn less, they are more likely to have interrupted working lives, taking time out from the workforce for family, and so the detrimental effects of a debt that is accumulating interest is magnified for them.
Further to the concerns surrounding FEE-HELP, is the cap of the loan at         $50, 000.  Some courses of study already offered to domestic full fee paying students already exceed this amount.  For students to be able to complete their studies a further loan, likely to be from a private lending institution, will be required.  This will be at real rates of interest and so the problem of debt grows even larger for these students. 
Students have needed to become reliant upon income that they can earn themselves. Youth Allowance/Austudy are falling further and further behind in the level of support it can offer in real terms, with Austudy currently 39% below the poverty line.  This has meant there is an increasing reliance by students on income that they can earn on top of the commitments that university study entails.  The measures in the Government proposals of the availability of various scholarships seems to be hollow given that Centrelink has indicated that these will be regarded as income and so some students may be better off not receiving these additional supports at all. 
A further concern in relation to income support is the proposed ‘Learning Entitlement’.  As stated previously, students are becoming increasingly reliant upon outside activities to support themselves.  In doing so they are forced to make decisions on their academic loading.  Additional pressures to support themselves may result in a longer time to complete their studies.  If the time allocated to complete their studies exceeds that of the learning entitlement students may find themselves forced into paying full fees to complete their degrees and so will take on an extra burden of debt. Learning entitlements are adjusted for part time studies but failure in a longer degree, such as Medicine could result in full fees being paid for unit repitition.Compared to other countries the level of income support offered to students is poor.  In Australia the majority of students are employed through semester (over 80% according to a study conducted by Monash University). This figure is considerably higher than Euorpean countres the average and is indicative of the differences in their vision of education and its benefits to society.
b. The financial impact on universities, including the impact of the Commonwealth Grants Scheme, the differential impact of fee deregulation, the expansion of full fee places and comparable levels of Government investment, and
The level of funding to higher education has been inadequate and has created a culture within institution that means that they are attempting to do more with less. where universities are forced to look for other unsecured sources of income rather than focus on their primary teaching and research roles. 
This has led to an increased reliance upon the income generated from the recruitment of international students and attempts to generate income from private ventures.  This has lead to various disasters such as that of Melbourne IT.  Universities are not businesses and it is not surprising that such ventures do not live up to expectations.  A further potential problem is that of intellectual property, where there can be conflicts between researchers and universities as to the ownership of any results that may be used to derive income.
The solution offered in the Government’s package means that universities will lose their autonomy in deciding what are the best courses for them to offer and will move the focus to private finding, be it through causing students to accrue debt, or through funding that is pegged to the Government’s political agenda.
The replacement of the block operating grants with the Commonwealth Grants Scheme is a means for the Government to gain control of the number of students who can attend a particular institution.  In addition to this, as the funding will be heavily weighted according to discipline, there will be particular amounts allocated to each degree stream.  The responsibility to make up for any funding shortfalls fall on each individual institution.  This can be done through the charging of additional tuition fees.  For small and regional universities there will be some additional funding over four years to alleviate the transitional costs of this system.  
Regional loading does not allow for externally studying students, and so institutions that have moved to cater for this kind of enrolment will be worse off under this arrangement.  In addition there is no compulsion on universities who have both CBD and regional campuses to spend this extra funding on the regional areas.
The CGS also will see the phasing out of marginally funded students.  The practice of over enrolling to meet demand has meant that universities have received some funding from the government, but have had to meet the gap between a fully funded and marginal funding themselves.  This practice in the long term is unsustainable, but it has meant that more students have been able to access a university education.  The move to remove this practice of over enrolments and replace them with fully funded places is finally recognition that these places are legitimate.  However, it will also be the case that there will be less university places on offer, meaning that more individuals will miss out on receiving a subsidised place.  This may have the effect of forcing people into debt by taking a full fee paying place at university.
The University of Western Australia does not currently accept domestic full fee paying students. This issue has been debated a number of times over the past few years within the University Senate, and it has been deemed undesirable to accept students who buy their way into the University.  Reasons for this include the impression that the degrees offered by the university will be devalued by having local fee paying students.  The University prides itself on its reputation of quality and this could be called into question if its position on domestic fee paying students were to be accepted.  The impact of the increase in the quota of allowable domestic full fee paying students is that there will be increased pressure on the University to change this position. 

Within the CGS there will be a pool of money allocated to universities that meet the Government’s industrial relations and governance agenda.  This funding will only be available to universities that are able to demonstrate that they have met with the National Governance Protocols and shifted their staff away from Enterprise Bargaining Agreements to Australian Workplace Agreements.  This is discussed further in section 4 of this submission.

c. The provision of fully funded university places, including provisions for labour market needs, skill shortages and regional equity, and the impact of the ‘learning entitlement’.

The  Backing Australia’s Future proposals for fully funded places, through the creation of the National Priority Band within the HECS system to meet the current and predicted shortages of teachers and nurses is a band aid solution.  The shortfall in the number of teachers and nurses is linked to the problems that are associated with health and education created by the gradual running down of Government expenditure in these areas.  Instead of trying to meet these shortfalls in this way, the Government would be better served to address the problems within these sectors effectively to make it  attractive to students to take on these career paths.  

A policy of providing cut-price options for students is a further reflection of the manipulation of the HECS system.  When first introduced, HECS was meant to allow an expansion of the higher education system to more individuals. 

The creation of the National Priorities HECS banding would seem, given the findings mentioned previously in 2a and 2b, to be pitched at potential student who cannot afford more expensive streams of study.  Given that there is mounting evidence that differential HECS is deterring mature age and low SES background students from study, individuals from these backgrounds may feel that there is no other option available to them without accumulating a large debt.

This is also the case in the creation of extra places for students studying Medicine who upon completion of their qualification will be indentured to regional areas for six years.  An arrangement such as this does not represent regional equity.  Rather it is, again, a band aid solution to a more complex issue.  If the Government is serious about these issues, about primary and secondary teaching and the health system it would address the underlying problems rather than attempt to bribe students to solve these problems in the short term. 

The manipulation of the HECS system continues with the deregulation of HECS fees by giving the universities the choice of increasing HECS fees up to 30% above the current levels.  In reality this is not a choice and this is discussed further in section 2b of this submission.

The package does not address the issues of regional equity either.  Backing Australia’s Future, in its proposals to compel regional campuses to engage with their wider communities does not recognize that this is already the case.  Regional campuses are a resource to their communities and are widely utilised as such.  This includes the student organisations attached to these regional campuses and the provisions to introduce Voluntary Student Unionism will mean that services that are currently provided will either be withdrawn or come at a much greater cost.

The UWA Student Guild does not support the ‘Learning Entitlement’ or the Higher Education Information Management System (HEIMS) that is attached to it.  The Learning Entitlement represents a time limit on learning.  There is no clarification on how it is to operate and this raises concerns as to how this will effect students.  It seems that it will be inequitable to students who will be engaged in courses that will take longer to complete than the mooted five year limit.  This means that students who fail any units, or those who change their degrees may be forced into a full fee paying place as they will no longer be entitled to their subsidized HECS place.  In addition given that there is an increasing trend to double degrees, which do take longer than the standard three year undergraduate qualification, there is increased pressure places on these students to complete their qualifications within the specified limit.  I

The proposed HEIMS is intrusive and uncosted.  There is no information on how a database of this size and scope will be created and administered.  With the proposal to bring this information management system into effect in 2004/5 there seems to be very little thought put into the practical application of this initiative.  Outside of the allocation of a Commonwealth Higher Education Student Support Number, there seems to be no central plan as to how this will interface with all of the universities.

3. The implications on the sustainability on research and research training in public research agencies.

The UWA Student Guild is discouraged by the proposed changes to the funding arrangements to research. There is no clear indication of what is going to be done with research and researcher training other than statements that reviews and taskforces will be investigating infrastructure, greater collaboration with industry, commercialisation of research and the operation of the research grant mechanisms.  The scope of these reviews are aimed at replacing the current funding arrangements towards a system similar to the Commonwealth Grants Scheme.  If this was to be the case then the same concerns raised in 2b about these arrangements will be applicable in this case.  Further to this the issue of commercialisation and the closer links to industry raise concerns about academic freedom and the ownership of intellectual property.

Postgraduate students are the backbone of research and are often employed in junior teaching roles.  Even students who have the option of taking on honours, which is the gateway to postgraduate studies will be affected.  The detrimental effect of the deregulation of university fees, the introduction of the Learning Entitlement and the introduction of the Higher Education Loans Programme on students ability to continue study will have an impact on research and research training.  These concerns are detailed in 2a and 2c.

4. The effect of this package on the relationship between the Commonwealth, the States and universities, including issues of institutional autonomy, governance, academic freedom and industrial relations.

The Backing Australia’s Future package will do much to damage the relationship between the Commonwealth, the States and universities. Backing Australia’s Future is intrusive and seeks to impose the Government’s political agenda on universities.  The autonomy of universities to determine how they are run, the numbers of students and types of courses that they can offer, the corporatisation of university governance, the ability to conduct research on merit and the ability to manage their own industrial arrangements with their staff are all attacked under Backing Australia’s Future.

As discussed earlier, the Commonwealth Grants Scheme represents an intrusion in the ability of universities to manage their student loads and the mix of courses offered.  The process of negotiating these with the Commonwealth puts universities at a disadvantage, where the priorities of the government rather than what is good for the institution will be the main focus.  The CGS will force universities to charge above the HECS rates to meet the shortfalls in funding.  The pegging of funding for compliance with the political agenda of the government is tantamount to blackmail.

Universities are governed by state legislation and so the changes that the changes that the Government wishes to impose in governance will mean that universities will have to lobby their respective state Governments to receive the funding that is pegged to make these changes.  This is especially so with the constituency of their governing authorities.

The University of Western Australia restructured its governance body, the UWA Senate, in 2000 in response to the Hoare Report.  It now consists of 21 members, with representation from students, staff and the wider community outside of the University.  The balance favours members who are external to the University.  These changes required an amendment to the University of Western Australia Act (1911).

The University in its governance structure has representation from students at all levels.  This is throughout, from the Senate (3 voting members), to Academic Board and Council, Faculty Boards and the range of management committees.  Student input to governance has meant that any changes that are undergone within the University has been done with consultation and this has benefited the University as a whole.  This good working relationship has seen the development of the Charter of Student Rights, the Ancillary Fees and Charges Committee and resulted in the development of practices and procedures that work for University Administration and the student body alike.

Backing Australia’s Future has labeled staff and students as ‘sectional interests’.  Given the experience at UWA, this is clearly not the case.  Rather student and staff are key stakeholders in the University and so their input in its management has ensured that the University enjoys the reputation of being a quality institution.  

Likewise, the proposal to introduce Voluntary Student Unionism is an attack on good governance of the University.  The Guild provides many services to the student community.  The active campus life supported by the Guild is one of the major selling points, along with its reputation for excellence, to international students.  The principle of user pays cannot be applied given that there is direct benefit to the entire student body through the representational work that the Guild does on their behalf with the University. 

The UWA Student Guild is very aware of the damage that VSU can inflict  on  campus life and to  the Guild’s primary responsibilities of representation, activities, welfare and services.  Having been under the burden of VSU from 1996 to 2002 the UWA Student Guild was forced to reduce the levels of services to students.  This included the closing of the Guild Computer Lounge, the redundancy of numerous staff, the withdrawal of the Sexual Assault Referral Centre Officer from campus, the loss of the Guild run child care facility and the restriction of some services to those who became financial members of the organisation.  The UWA Student Guild is fortunate to have had investments that it could call upon to help it through the difficulties and challenges that VSU presented.  Even so, with the repeal of VSU in late 2002 the UWA student Guild still finds itself in a position where it is still recovering from the effects of VSU.  However, this is still a better position to be than some of the other Guilds in Western Australia, most notably Edith Cowan University Student Guild, which went into receivership several times, and the Murdoch Guild of Students who came close to receivership.

Student organisations are political in nature, as is any democratic organisation, especially one where one of the primary roles is to act as a watchdog for its constituents.  This watchdog role applies to both university administrations and the Government. 
The push towards taking on domestic full fee paying students has implications for academic freedom and quality assurance.  Already universities have become heavily reliant upon full fee paying international students.  There have been numerous and very public cases of ‘soft marking’ where international students who do not meet the requirements to pass their courses have been passed at the universities insistence to protect their standing in this highly competitive market.  

Most recent is the case at the University of Newcastle.  This follows on from a list that includes the plagiarism case at Curtin University covered by the Deane Terrell Inquiry and the Ted Steele Case at Wollongong University.  The Ted Steele case is worth noting as the University attempted to dismiss Associate Professor Steele for whistle blowing the upward shifting of marks of international students.  

If these are the practices that universities are willing to take on for international students, and there is increased pressure to receive income from domestic full fee paying students through the passing of the proposals in Backing Australia’s Future, what is to say that this practice will not become more endemic?  Further to this, the question would also be what would this do to the standing of Australian higher education?  Students want to know that their degree are quality assured and received on merit, not on the ability to meet tuition costs.

Backing Australia’s Future has further implications for the notion of academic freedom.  In its push for universities to engage with business there is the risk that that research and other academic pursuits are not based upon their merit, but rather to reflect the nature of these partnerships.

 Backing Australia’s Future seeks to push the Governments industrial relations agenda onto campuses.  The pegging of additional funding to the adoption of Australian Workplace Agreements is pure blackmail for the already cash starved universities.  The coupling of this to amending the Workplace Agreements Act (1996) to remove the ability of university staff to take industrial action is blatantly unfair.  

Universities are already one of the most flexible workforces in Australia, with over 33% of university staff currently employed on a casual basis and 20% of staff on contracts.  The Government has stated that it aims to retain quality university staff and encourage expatriate researchers and academics to return to Australia.  Without a stable industrial environment the incentive will be for more university staff to leave Australia rather than be encouraged to stay or return.

5. Alternative policy and funding options for the higher education and public research sectors.

In looking at what is the appropriate funding balance for higher education and research there is a need to look at what are the costs and benefits to society as well as the individual.  The short term financial costs of running tertiary institutions needs to be balanced against the eventual total taxation gathered from graduates.  Research indicates that students repay the cost of their education through the course of their working lives.  What cannot be costed is the social gains made by having a more educated community.  Additional to this is the income derived from research and intellectual property created through higher education.

The UWA Student Guild believes that higher education should be funded through a progressive taxation system, which allows those access education to those that have the ability..  It is of paramount importance that those who have been able to access higher education and through this enrich the wider community are not burdened with a lifetime of debt.