According to a story in today’s Sydney Sun-Herald, the National Union of Students is calling for an inquiry into the ‘economic impact of student debt’. Unfortunately for them, the human interest aspect of the story – one Joy Kyriacou (who by I am sure by complete coincidence has the same surname as former NUS President Daniel Kyriacou) – could not get her lines straight and revealed NUS’s campaign as the shameless rent-seeking that it is:
Ms Kyriacou, who graduated with a Bachelor of Education and Bachelor of Arts from the University of NSW in 2006, said the $16,000 student debt burden was stopping her from saving for other things, like her first overseas trip or a house deposit. (italics added)
Of course it was bad enough that we were being asked to to finance a special first home buyers grant for graduates. But now we are being asked to fund their overseas holidays as well. Even by the very low standards of arguments against HECS, this one is a shocker.
The NUS leadership is hardly brighter than Ms Kyriacou. Any honestly conducted inquiry along the lines they propose will only discredit their arguments. For example, NUS President Angus McFarland told the Sun-Herald that:
“Across the board, HECS relief is required to boost graduate participation in our economy,”
Yet according to ABS Education and Work 2007 that particpation is already at 86%. It was 87% in 1996, before the 1997 and 2005 HECS increases, but if this is not a sampling issue it is likely to be due to the feminisation of the graduate workforce since then.
And Andrew Leigh and Bruce Chapman’s research of a couple of years ago found very little bunching of incomes below the HECS threshold, despite the cash flow consequences of moving above it by small amounts.
While there is a small amount of survey evidence that some people with NUS-type views are unwilling to make their fair financial contribution, it is obviously much better for taxpayers in general to suffer a few cheats than to write off a billion dollars a year from the vast majority of graduates who are pleased to get jobs.
I am happy to back NUS’s call for an inquiry, provided it is conducted by a reputable person or organisation. It cannot do their cause any good.