The Federal Government has proposed changes to existing university funding arrangements that would result in higher course fees for a large number of students.

The Minister for Education has suggested the reforms will incentivise students to undertake specific university courses in areas of expected employment. The alterations to funding arrangements have been justified on the basis of job security with government modelling finding that more than 60 per cent of employment growth in the next five years will come from science and technology, healthcare, education, and construction.

Unpacking the Reforms

The changes to tertiary funding arrangements will create 39,000 new university places by 2023 with no overall increase in government funding. The government will bankroll extra places by increasing and decreasing tuition fees dependent on whether degrees are in so-called ‘job-relevant’ fields. Education, health, information technology, engineering, and science courses are some of the areas that would experience lower student contributions.

Young people planning to become teachers, nurses, and engineers may benefit from cheaper degrees, but those enrolling in arts, humanities and social services courses will face substantially higher course fees. These students will have to contribute more to the cost of their courses and the government significantly less. Budding lawyers and commerce grads will have their fees raised by 28 per cent whilst fees for humanities courses will more than double, increasing by 113 per cent. Undertaking a humanities degree could increase from $6,804 to $14,500 per year, becoming as expensive as studying medicine.

Students will also have to pay more for youth work degrees under the proposed changes. This is particularly worrying as there is strong demand for youth work graduates and the COVID-19 pandemic is increasing the demand for youth services in Victoria. There is significant concern that universities will not offer sufficient youth workplaces to match workforce demand if courses are not adequately funded. This also applies to social workers and those in the community sector who are experiencing increased demand during the COVID-19 pandemic. There is an urgent need for more places in these courses.

Spare a Thought for the High School Class of 2020 

The proposed changes to the Commonwealth contributions for university courses undermine choice and opportunity for all. Increasing student contributions for certain degrees has the potential to make university inaccessible for thousands of young people.

This may disproportionately impact marginalised young people and others who are unable to afford higher course costs. Prospective higher education students who will be required to pay more for the cost of their degree may be discouraged from undertaking a course that the government regards as less essential for future workers.

Does the Evidence Stack Up?

The overarching rationale of the policy proposal is to motivate students to undertake degrees with the best employment outcomes. Contrary to the rationale for the proposal, humanities and social science graduates have similar job outcomes to science and mathematics graduates.

Results from the 2019 Graduate Outcomes Survey found total employment for graduates of humanities, culture, and social sciences courses in 2019 was 83.9% and for science and mathematics it was 82.4%. The high levels of employability — akin to graduates from the so-called ‘job-relevant’ courses — demonstrate the utility of art-based and humanities education in our universities.

READ: Final year Arts student Tiana Sixsmith defends her degree as she prepares to enter the workforce.

Is There Value in Price Signalling?

The logic of the proposed government policy relies on the assumption that young people are price-sensitive to the cost of university degrees and will make decisions based on the cost of courses. However, given the HECS-HELP fee loan scheme allows students to pay their fees later, student contribution discounts will not necessarily encourage students towards job-ready courses.

Andrew Norton, Professor in the Practice of Higher Education Policy at the Australian National University, suggests student course preferences are largely influenced by their interests. Research into understanding first-year students’ motivations for course choice showed it is largely influenced by career interest as opposed to improving job prospects, satisfying family expectations, or attaining training for a specific job.

Rather than redirecting young people to undertake specific university courses, the government’s new policy proposal will only sentence arts and humanities graduates to prolonged and more expensive HECS repayments. Instead of increasing course fees for an entire generation of students we should invest in equitable funding schemes that support all young people to access higher education.

Our Recommendation

YACVic recommends that the Australian Government works in partnership with young people to refine its university fee reform proposal, to ensure:

  • That all young people have equal and affordable access to the higher education course that is right for them.
  • An adequate social and community workforce pipeline, especially with the increasing demand resulting from COVID-19 disruption.

This page was written by Hannah Ewing, who is supporting YACVic's Policy work.


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