Vice Chancellor Stephen Parker: Pyne’s higher education reforms doomed to failure

By Stephen Parker

Christopher Pyne and I were on diametrically opposite sides over the Higher Education and Research Reform Bill and its associated Senate Committee inquiries, so the reader needs to interpret my comments in this light. 

Minster Pyne repeatedly said I was the only one of 41 “vice-chancellors” who did not support his reforms.  In the House of Representatives he was critical of the National Centre for Social and Economic Modelling (NATSEM) at the University of Canberra, implying that its findings were biased because I was in charge of the university in which it was housed.  Even Tony Abbott acknowledged subsequently that NATSEM was one of the best-regarded modelling organisations in the country. So I guess I do have a starting point in this analysis!

I believe Christopher Pyne’s failed attempts at higher education reform is almost a textbook example of how not to get complex and controversial reforms through the Australian parliament. The Coalition did not control the Senate and did not spend time getting to know the people who held the balance of power.

The proposal to cut 20% funding to universities, partly to save money and partly to extend Commonwealth Supported Places to private higher education providers and sub-bachelor places, came out of the blue and flagrantly breached pre-election promises that there would be no cuts to education and no change to university funding arrangements.

Then there was the proposal to retrospectively apply a real interest rate to existing HECS debtors (when debts have been linked to CPI since the inception of the scheme).  I don’t think this really hit home to people. Hundreds of thousands of voters would have had a debt hike they could do nothing about. It was a real sleeper.

Let’s get on to allowing universities to charge domestic undergraduates what they wished, without any valid modelling of the impact on debt levels, or how young people would make choices in the light of an income-contingent loan scheme.  I use the word “valid”. I don’t actually know whether any modelling at all was done, because the nation’s experts could not say what the impact would be. Their best guess on fees was a doubling or trebling of levels, but it was only a guess.

Yes, the idea to apply the real rate of interest on HECS debts was dropped. It was a relief to many, but it also scuppered any logic to the scheme.  If the government were to borrow money at the long-term bond rate and lend it to students at a lower rate (in circumstances when default would also rise) then the changes would cost money not save it.   The more fees went up, the bigger the gap between the price of money to the Government and the amounts recouped. This was why I described the situation by December 2014 as “ideology in search of a problem”.

My colleague Ben Phillips pointed out that tertiary fees are part of the CPI basket, so a rise in higher education tuition fees would mean that a whole range of benefits and payments would also rise. He did not get a response to his observation from the Abbott government. By this stage we were talking about a scheme that would lose billions.  It couldn’t have lasted.  It would have inflicted debt on several cohorts of graduates until Treasury realised what was happening.  By this stage (circa February 2015) I was no longer sure it was ideology in search of a problem: it just seemed like it was all about saving the Minister’s skin, despite his self-proclaimed fixer status.

I could go on (I do, in fact, often) but suffice it to say this was policy by ambush, trimmed on the run in the face of evidence, and personalised in the face of opposition.

I welcome Labor’s intention, announced on Monday, to set up a Higher Education Commission, which would introduce a non-political rational actor to higher education reform, and to use Green and White Papers to allow reasoned debate.


Stephen-Parker1 copyProfessor Stephen Parker AO is the Vice-Chancellor and President of the University of Canberra. He was previously the Senior Deputy Vice-Chancellor at Monash University in Melbourne. 

Prior to taking up senior management positions Stephen was a legal academic.  He has lectured at University College Cardiff, the Australian National University, Griffith University and Monash University.  He was Dean of Law at Monash from 1999 to 2003. 

Stephen moved to Australia from the UK in 1988, having mixed lecturing and legal practice over the previous decade.  He graduated with honours in Law from the University of Newcastle upon Tyne and a Doctorate of Philosophy from the University of Wales.  He is admitted to legal practice in England and Wales, the ACT and Queensland

Stephen has published books, monographs and articles on the court system, legal ethics, family law and children’s rights.  He is also the co-author of a textbook called Law in Context, which is designed to introduce law students to the way that other disciplines view law.

He has held various major research grants in relation to projects on lawyers’ tactics, lawyers’ values, discretionary rules, family law, judicial independence and reform of civil procedure.  In 2012 he was elected a Fellow of the Australian Academy of Law.

Stephen was made an Officer of the Order of Australia (AO) as part of the Australia Day Honours in January 2014 for his distinguished service to tertiary education through administrative, academic and representational roles, and as a leader in the growth and development of the University of Canberra.

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