Mr Norton has previously told The Australian Financial Review that inflation will change the politics of higher education as student debt accelerates, raising the cost of living while studying, and increasing the amount that students must later repay.
Mr Norton, who is with the Centre for Social Research and Methods at the Australian National University, has also pointed out that inflation will reduce the number of student places available because, while both the government and student contributions are indexed to CPI, the total amount that goes to universities is fixed under universities’ funding agreements.
The federal government last year announced a review of higher education that will include the current schedule for student contributions, a scheme known as Job Ready Graduates.
The review panel, headed by former NSW chief scientist Mary O’Kane, will probably dump the changes to student contributions introduced by the Morrison government that were meant to steer students towards study areas it deemed of economic importance.
The changes have had almost no effect on what students study, while putting in place perverse incentives for universities to offer more places in the areas the policy was meant to steer them away from – and hammering those students with massive fee increases.
Mr Norton said rising inflation would also dramatically increase the amount of unpaid student debt, formerly known as HECS and now called the Higher Education Loans Program, sitting on the government’s books.
At the same time, another policy bungle reduced the average amount domestic graduates repaid on their loans each year from $4345 in 2017 to $3462, adding further pressure to the government in the form on unpaid debt.
Source link
