Grattan Institute calls for uni course subsidy review

Andrew Norton, formerly attached to the Centre for Independent Studies, is now at the Grattan Institute and is continuing to produce hard-hitting reports on our generously subsidised university system, with his latest called Graduate Winners. Andrew is one of Australia’s leading experts on Australia’s higher education system and his work has always been widely discussed by Canberra policy wonks, even if they were never able to fully implement Andrew’s vision for higher education reform.

The media release for the report notes:

By the middle of this decade, higher education tuition subsidies will cost taxpayers around $7 billion. Yet it is not clear why the public rather than students should pay.

Since most graduates do well out of higher education, enjoying good jobs and high social status, most subsidies are for courses that students would take anyway. Tuition subsidies therefore merely redistribute income to students and graduates, at the expense of the general public – particularly those who do not go to university.

The implications of Andrew’s analysis are profound and could lead to large increases in HECS-HELP repayments for engineering, IT and medicine graduates, for example. There are already different rates of tuition fees for different courses, depending on the perceived balance between public and private benefits, so science courses get a greater subsidy than law courses, for example. However, there doesn’t appear to be much science behind the subsidy levels, so a review of subsidy levels applying Andrew’s framework would be welcome.

I’ve previously thought Grattan was too worried about losing its federal funding to produce frank and fearless advice, but I’m pleased to have been proven wrong, and I have no doubt Andrew’s latest report will have a long shelf life and influence policy into the future.

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