Do surplus HECS places mean full-fee places are not necessary?

Swinburne University in Melbourne can be quite innovative. For example, it is planning to offer a joint Master’s degree with Northeastern University in Boston, so that students receive both Australian and American credentials.

But that’s for the deregulated postgraduate market. In the Australian undergraduate market, Swinburne’s Vice-Chancellor Ian Young sees students as playthings in an egalitarian ideological game. Back in April I had a go at him for opposing the University of Melbourne’s plans for US-style graduate schools (disclosure: the U of M is one of my employers). He thought that this would create inequality between universities – the educational benefits being of little relevance to Young.

Today he is quoted in an Age story on the regional University of Ballarat, which this year has not been able to fill all its Commonwealth-supported places (aka HECS places).

But with demand falling markedly, Professor Young said there was for the first time an oversupply of HECS places, making full-fee places unnecessary.

But aggregate supply of places was only ever one, and not the most important, use of full-fee places. Commonwealth-supported places are allocated under a quota system, with little or no regard for either supply (that is, a university’s willingness to offer places) or demand (applicants wishing to do the course). Full-fee places allow supply and demand to meet, despite the quota. Someone who wants to do Law or Medicine at the University of Melbourne would rather pay vastly more and do that then get a much cheaper HECS place at Ballarat – we know this is true, because anyone who can get into those full-fee courses at Melbourne already has an ENTER (95+) that would get them into almost any other course around the state at a fraction of the cost.

Perhaps Professor Young wants quotas abolished, but if so, why doesn’t he say so? But I suspect he does not. Most Vice-Chancellors quite like the quota system, since it protects them from the pressures of competition. Young wants full-fee places abolished because he puts egalitarian ideology over the course and career hopes of young Australians.

Update: The original last paragraph was based on what Young was reported as saying in The Age and his previous public statements. But I have now received a copy of a speech he gave last week, in which he gave as a possible response to excess places the kind of reform I have long advocated: giving students vouchers, lifting all controls on student numbers, and letting universities charge market rates. In that policy context, full-fee places are indeed unnecessary if it is a universal voucher scheme, rather than a more limited voucher scheme in which the government still decides who should and should not get a voucher.

This is an amazing turnaround by Young, given what he was saying as recently as April.