Australians have found themselves in the middle of a debate not unlike the ongoing dispute in the U.S. over the cost of higher education. This year, the Australian government unveiled a proposal that would allow universities to raise tuition without any regulatory restraints. Officials say the changes would make schools more competitive, but opponents believe college in Australia will become unaffordable.
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If passed by the Senate, the legislation would take effect January 2016 and would cut government funding per student by an average of 20 percent. It would also raise interest rates on student loans and lower the income threshold for students to start paying back those loans. Loan rates would be indexed to the 10-year bond rate, with a cap at 6 percent; rates are currently capped at the rate of inflation.
Officials supporting the proposal believe tuition deregulation will allow universities to differentiate themselves based on their strengths, which will help Australia compete internationally.
In a July public address to the National Press Club, Ian Young, vice chancellor of the Australian National University and chairman of Australia’s prestigious Group of Eight universities (Go8), described deregulation as “the holy grail.”
“We have created a perverse incentive that rewards universities for enrolling as many students as possible and teaching them as cheaply as possible — that’s what our current system does,” says Young. “The nature of our university system forces us to be average. We have very few terrible universities, but we have no truly outstanding universities.”
Officials have conceded that tuition at some universities could possibly double or triple, which means students currently enrolling in college will have no idea what they’ll be paying in Jan. 2016.
Critics of the proposal claim the government simply wants to cut its own spending. They’re also concerned that the proposed changes would push more Australian students to go abroad for their education or to abandon higher education altogether. They worry that the students who do seek college degrees in Australia will become caught in the trap of student loan debt.
The New York Times quoted a letter the University of Adelaide’s vice chancellor, Warren Bebbington wrote to faculty and students expressing his concerns over the proposed changes.
“My interest in these reforms was to see Australian students in the coming years have a much wider choice of the types of degrees, as found in the U.S. but without the U.S. burden of crippling student debts,” Bebbington says. “In fact, it is starting to look as if the student debt burden for many under the proposed reforms might well be worse than in the U.S.”
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