The Albanese government wants to lower university fees if re-elected and has set its sights on long-term educational reform.
In Tuesday’s Labor caucus room meeting, Education Minister Jason Clare revealed he intends to set up an Australian Tertiary Education Commission (ATEC).
It’s understood the body would provide non-binding advice to the government on course fees, which the government would set.
Clare noted that while MPs and senators had paid roughly 30 per cent of their degree, student contributions were currently averaging over 40 per cent.
The move would aim to roll back the (JRG) package, implemented by the former Morrison government, which saw some cuts to some degrees and vast increases to others.
The establishment of a commission would be part of a suite of measures offering students relief, including Sunday’s and adjust the income threshold necessary for students paying back their HECS-HELP loans.
Targeting soaring student fees
The Australian Universities Accord (AUA) report released in February recommended the establishment of an independent ATEC body to reform the sector.
It outlined the need to understand the cost of delivery to providers in order to assess “fair levels of student contributions”, which grew to above 40 per cent under the previous Coalition government.
This is in part due to the JRG which tried to incentivise study in particular fields by adjusting Commonwealth and student contributions to different degrees.
It reduced fees to degrees seen as a priority, lowering agriculture by 59 per cent, while others deemed less necessary, like humanities, saw costs soar 113 per cent, according to February’s AUA report.
Bruce Chapman is an emeritus professor of Economics at the Australian National University and is regarded as the architect of the original HECS system.
He told SBS News there are “great inequities in the system that weren’t there before”, pointing to the increase of humanities degrees under the Morrison government.
“Most important problem with the system now is that the prices by field of study are all wrong, and they’ve been wrong since 2020. And the former government changed those prices very radically,” he told SBS News.
“Humanities graduates, particularly female humanities graduates, are the lowest earning graduates over their life cycle, but they’ve now got the highest charge that is very inequitable and unreasonable.”
He said these inequities should be the number one priority of any commission established.
Labor’s plans to reduce student debt
On Sunday, Labor announced it will wipe 20 per cent off all student loan debts by 1 June 2025 if re-elected, which Clare told caucus would fix rising contributions “for a generation”.
The election pledge would affect HECS-HELP loans for almost 3 million Australians, with the average HECS debt of $27,600 cut by about $5,520.
Chapman labelled this a “stopgap measure” that will provide some “sense of relief and fairness while the commission looks at the relative prices”.
He said that it was more important to raise the income threshold for when students start repaying their HECS-HELP loan after it was lowered under the former Coalition government.
Labor’s plan is to raise the income threshold from $54,435 in 2024-25 to $67,000 in 2025-26 and index it to keep it at 75 per cent of graduate earnings.
“To give you some context, when HECS was first designed, that first threshold of repayment in current dollars is about 85,000 and governments, over 35 years, have continually moved it around,” Chapman said.
“It’s now at a very low level and a very unreasonable level. So I think it’s a very important and productive move to get that repayment threshold much higher than it currently is.”
Labor’s announcements have drawn criticism from the Opposition, with leader Peter Dutton labelling it a “card trick” to lure back voters.
Liberal frontbencher Paul Fletcher told ABC RN on Monday that it was unfair for the remainder of Australian taxpayers to front the tertiary education of people who “will have much higher life earnings than the average across the community”.
