Australian Government Faces Criticism for the Budget Cuts in the University Funding System

Budget Cuts in the University Funding System

When the Federal Government revealed its plans for budget cuts to higher education courses in 2014, the majority of citizens failed to comprehend the gravity of the situation. The university overhaul policies included fee deregulation and funding cuts – measures that will greatly affect the studies of all students, as well as the way Australian universities function.

Professor Bruce Chapman, the expert who created the loan system known as Higher Education Contribution Scheme, shared his opinions as soon as the plans of Abbott’s government were announced. Regarding the fact that this plan involved interest on student loans, Professor Chapman said that the Australian government should follow Britain’s example: graduates should start paying interests only when they start earning income above the repayment threshold.

Last week, Professor Chapman spoke at a forum at the Australian National University, making his opinions clear: he thought the plans of the Government were too radical for consideration. “We had never modeled any of this because we thought the likelihood of it ever happening was close to zero,” – he explained.

Although Abbott’s plan to bring changes to university fees was rejected by the Senate, he said his Government would not give up on the ‘necessary’ reforms. as the company which works with Australian students for almost 10 years is extremely concerned by this decision and conducted own investigation into the possible reasons for this decision of the government.

The Prospects: How Will These Reforms Change Australian Higher Education?

The Federal Government’s plans involve cutting in the university funding system by 20% and allowing freedom for the institutions to make up the shortfall by setting their own student fees. This measure is justified with the argument that universities would be able to invest more money into research and achieve better ranking on international level.

There is a certain level of skepticism about the intention to deregulate the fees. If (or when) the universities are allowed to charge whatever fees they consider to be realistic, they will most definitely increase them.

According to the experts at the ANU forum, there is no point in making reforms when they are obviously not necessary. The reforms can influence the Australian educational system in a bad way: the institutions will chase profits instead of focusing on providing high-quality education. More than half of the Australian public universities are present in the Academic Ranking of World Universities. The argument that the deregulation would increase the quality of education is not realistic.

According to Brian Schmidt, a distinguished professor and astrophysicist, students should not bear the financial responsibility for research. “I don’t think students are getting good value for their tuition dollar because of that distortion,” – he explained. “When I talk to students I cannot justify to them why they should be paying my salary as an astronomer. Why should their student fees be paying for research? I don’t have an answer for them.”

What Other Options Does the Government Have?

If the Government proceeds with the plans to extend the HECS/HELP program to private colleges and Technical and Further Education students, the federal state could get burdened with more student debt. Many Australian students don’t earn enough to pay their student loans upon graduation. If the threshold for paying back loans is extended to a greater number of students, the rate of repayment will inevitably decrease.

According to Professor Chapman, the deregulation of fees should be accompanied with penalties for universities that charge above a certain level. This suggestion might not solve the entire problem, but it will bring a certain level of regulation in the freedom Australian universities gain.

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