What is happening in undergraduate enrolments?

Yesterday the Department of Education released the 2005 financial reports (pdf) for publicly-funded universities. According to Catherine Armitage’s report in this morning’s Higher Education Supplement:

THE so-called Nelson reforms appear to have undershot their potential to fill university coffers, with local undergraduate fee-paying places earning universities just $103.7 million, or 0.7 per cent of revenue, in 2005, the first year in which looser regulation of local fee places took effect.

I’m not so sure that this is the right take on 2005’s finances. On my calculations, up-front revenue from Australian full-fee undergraduates is up a healthy 9.8%, but this is not counting the people who deferred their payments through the FEE-HELP loans scheme, which was the most important element of the Nelson reforms. This is where it gets hard to work out what is going on, because FEE-HELP covers both undergraduate and postgraduate fee-payers.

However, we can take an educated guess. FEE-HELP’s predecessor, PELS, was available only to postgraduates. FEE-HELP lending in 2005 was 21.7% higher than PELS lending in 2004. We already know from aggregate enrolment data (pdf) that postgraduate enrolments overall were stable. This suggests that most of that lending growth was in the undergraduate market. It’s possible that undergraduate full-fee revenue is in fact up by 40% or more.

Another aspect of the financial data pointing to growth in the undergraduate full-fee market is the surprisingly low growth in revenue from Commonwealth-supported students. On my calculations, it is only 3.1%. Given that this was the first year of the 25% increase in student contributions that many universities imposed (though only to commencing students), and that there was normal indexation (about 2%) on students from previous years, it should have been more.

The only ways I can think of to explain this are that the total number of Commonwealth-supported students was down and/or there was some shift in the discipline mix toward lower-revenue places. I think the former explanation is likely to be the main one as we know that total undergraduate enrolments increased by just .9%.

My interpretation: Commonwealth-supported undergraduate enrolments actually went down for the third year in a row, and all the growth was generated in the full-fee market. As has been the case for a number of years, the private education market is propping up the dysfunctional public higher education system. Little wonder the government seems to be endlessly stalling releasing the full student enrolment data that would tell us what is really going on.