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Debunking some of Education Minister Christopher Pyne’s claims

Media Release
Lee Rhiannon 28 Aug 2014

Education Minister Christopher Pyne has made a number of claims which don't hold up under scrutiny.

Claim 1: “80,000 extra students will be enrolled in Commonwealth Supported Places by 2018.”

Fact: The Government’s proposed changes to higher education funding will see public subsidies given to private, for-profit higher education providers for the first time.

While it is true that students in the private sector and those studying sub-bachelor degrees in the university system will now receive Commonwealth Support, the Government has been unable to confirm new students will enroll in these courses as a result of these changes.

In fact, the Bill’s explanatory memorandum confirms that the rate of growth in student enrolments in this area will be slower than in previous years.

The end result of these changes will be a windfall of half a billion in subsidies to private higher education providers without any guarantee of increasing access.

Claim 2: “The Commonwealth Scholarship will provide more opportunity for students with low socio-economic backgrounds and from regional areas.”       

Fact: No Commonwealth government funding will go into these scholarships.

Universities will be forced to increase their fees by at least 20% before a single dollar will be diverted to the creation of Commonwealth Scholarships.

Universities like the Group of 8 who will be able to maximise the increase in student fees under deregulation will have the largest pool of funds for Commonwealth Scholarships.

These universities have the lowest proportion of students from low-SES backgrounds. Small and regional universities who teach the higher proportion of low-SES background students will have the smallest amount of funding for Commonwealth Scholarships.

Mr Pyne has said he didn't expect fees to increase significantly under a deregulated system[1]. Mr Pyne can't have it both ways. Either fees will increase significantly or Commonwealth Scholarships won't exist.

The Government is also looking to save $800 million by abolishing existing student start-up scholarships and cutting out relocation scholarships for students moving between or within capital cities. 

Claim 3: “When universities and colleges compete, students win.”

Fact: Low income graduates could be forced to pay twice as much for their degrees compared to those on higher incomes, as a result of compounding interest rates on their HELP debt.

The charging of real, compound interest rates on HELP debt will result in graduates with lower starting salaries taking far longer to pay off their debt compared to those on higher starting salaries, even when real pay rises are factored in.

The Government’s own Explanatory Memorandum for the Bill acknowledges that graduates on low-incomes and those who take time out of the workforce, will take longer, and therefore pay more, to pay off their HELP debt.

Women who take time off work to have children are a clear example of this and will carry one of the largest financial burdens under the Coalition’s higher education plans.

The gender pay gap is about to widen when the Abbott government’s higher education debt burden on women kicks in.

Claim 4: “There are no threats to cut research funding”

Fact: In the Bill, the government is proposing a 10% across the board cut to the Research Training Scheme. It is also proposing to charge a fee of up to $4,000 a year for PhD students. A PhD student wanting to undertake research project in the medical field, for example, could be facing a cost of up to $20,000 plus interest.

The Coalition has already cut $111.4 million from CSIRO, $80 million from Cooperative Research Centres, $74.9 million from the Australian Research Council, $27.6 million from ANSTO and $120 million from DSTO over the next four years.

Claim 5: “Regional universities will be the biggest winners from this reform.”

Fact: Regional Universities are set to lose from this reform.

Regional towns across Australia don’t have multiple universities that can be forced to “compete” with each other. Regional universities like the University of Wollongong and the University of Newcastle are the only universities in those cities.  Tasmania only has one university.

Small and regional universities oppose fee deregulation because they know it will lead to elite institutions increasing their fees at their expense, further widening the funding gap between the big, rich universities and those that play a crucial role in educating and employing tens of thousands of people in regional Australia.

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