Big business drives government's education plans

August 20, 1997
Issue 

By Marina Cameron

In a submission to the government's West review into higher education, the Industry Commission has argued that radical "market-based" reform and more competition are the logical next steps after the deregulation of the 1980s.

The IC submission, made in late July, is a clear indication of what big business wants in higher education, and is totally consistent with government policy. The IC argues that funding to universities should be cut further, decreasing from 60% of all university income to 50%. (Commonwealth funding accounted for 90% of university income in 1981.)

Universities are being encouraged to compete for funding from students and business by offering research services and fee-paying courses.

The IC argues that partial deregulation of fees is not enough. Overseas and postgraduate student fees were deregulated under Labor, and the Coalition has allowed universities to charge fees for some undergraduate students from next year.

The IC advocates full autonomy for universities to charge course fees. Commonwealth funding should no longer just be handed over, it argues, but provided through a system of portable HECS-style "scholarships" (equal to 50% of the course cost) which can be spent at any public or private university or TAFE.

This sort of voucher system was part of the Liberal Party's 1993 election platform, and has been put forward in a watered-down version by leading members of the Labor Party.

The IC argues that increased competition will lead to better education performance.

However, as reported in the Sydney Morning Herald on July 5, a paper by Professor Fred Smith, deputy vice-chancellor of research at La Trobe University, indicates the dangers of "market-based" education.

Currently operating grants are provided to universities largely on the basis of the number of students enrolled, while 5% of government spending on higher education is reserved and allocated on a "performance" basis.

In a submission to the West review, the elite "Group of Eight" universities have called for this fund to be increased to 15%. Smith points out that the government is unlikely to provide more funding overall, and estimates that many of the smaller, newer universities could have their budgets cut by up to $15 million, while the universities of Sydney and NSW would receive an additional $42 million.

So far it is predominantly the universities that think they can corner a market on specialist courses that have decided to introduce fees — Melbourne, Sydney, NSW, Adelaide, Monash, Deakin, Central Queensland and Monash universities and the Royal Melbourne Institute of Technology.

Even the chair of the government's review, Roderick West, has been forced to admit that there are problems with a "market-based" system, because "the market has no conscience".

A market-based approach prioritises profit and competition above people's needs. If the government-big business plan is pushed through, the poorer universities and the majority of students will be the losers.

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