The puzzle of high Victorian unmet demand for university places

In an article for yesterday’s Education Age, I had a go at explaining why the prospects of Victorian applicants for university are worse than those of applicants in other states.

The unmet demand statistics consistently show that it is higher in Victoria than elsewhere; using other data sources I found that this has been true since 1993 at least.

It will surprise none of my regular readers that the unmet demand culprit is the centralised system of distributing university places, which until fairly recently aimed at equalising higher education participation between the states, rather than meeting actual demand as revealed in applications to attend university. Though Victoria has not relative to its population been under-supplied with places compared to other states, because demand there is higher than the national average more of it is ‘unmet’.

But identifying the culprit still leaves a puzzle: why is demand higher in Victoria than elsewhere? The main reason seems to be that school retention is higher in Victoria than in other states. With a higher percentage of young people finishing Year 12 in Victoria than elsewhere, more people have the basic qualification needed for university entry.

A couple of people have asked me whether Victoria’s private schools might have something to do with the story. The ABS schools data suggest that indeed this could be the case.

Going back at least 40 years, Victoria has had more students attend private schools than is typical around Australia. I don’t know my school history well enough to explain why this is the case, but as private schools are more focused on university entry this would, all other things being equal, translate into higher demand for university places in Victoria.

But the 2006 schools data suggests that it is not just more private schools driving Victoria’s high university demand, it is their greater success in seeing their pupils through to the end of school. While Victorian government schools have Year 10 to 12 retention rates 3.6% above the national average for government schools, Victorian private schools are 6.3% above the national average for private schools.* A different non-government market share divide between the Catholic systemic schools and independent schools in Victoria is my first guess at why, but the recent ABS data does not let me check this hypothesis.

Either way, my Education Age article favours supply following demand rather than a central planner’s vision of what Australia should look like.

* These are ‘apparent’ retention rates, ie this would be Year 12 students in 2006 as a % of Year 10 students in 2004 in Victoria for each school system. It is possible that there is more drift to private schools for the last years of school in Victoria than elsewhere.

9 thoughts on “The puzzle of high Victorian unmet demand for university places

  1. But you can’t just have people demanding that places be created where they happen to be, anymore they can demand jobs be created where they happen to be. No, we have a national market for university places, and Victorian students are free to apply for a place wherever, and go to where they are lucky enough to get in. No problem.


  2. Russell – There is interstate movement to study, but from memory it is not unusually high for Victorians. But for someone like you concerned about cost, it would seem cheaper to provide a place near the student, rather than require Victorians to go to over-supplied (relative to demand) places like Tasmania.

    Cathy – For this year, anyone with an ENTER of 56.2 or above was classed as ‘eligible’. Unmet demand is mainly in the below 70 group, but I have not been able to get Victoria-only data to see whether its unmet demand is disproportionately among weaker applicants.


  3. Interesting. I would have thought that a student with an ENTER of 56.2 – if that is a genuine reflection of their abilities – would struggle in most university courses. I have heard somewhere (sorry, can’t remember the source) that in Victoria there is a large(ish) drift from public to private for the last two years of high school. It is thought that this is because Victoria lacks the extensive selective school system that we have in NSW. (Maybe I should phrase that the other way around: NSW manages to retain more of its academically minded secondary students in the public system because it provides them with academically selective state high schools.)


  4. There are a number of differences between Victoria and other states that may cause some of this — if you look at the industries in Victoria, for example, it’s obviously more worthwhile having a degree than some of the other places for some groups, so you would expect there to be higher demand.

    There might be more subtle cultural differences also. It would be good to get some figures on overall attitudes to education, but I’d bet that even getting rid of the private/public school factor, the average Victorian thinks more highly of a university education (and probably education in general), than, say, the average Queenslander. Part of this may simply be an historical artifact. That could be probably be tested by looking at the general population versus groups that arrived more recently across the states, and seeing if there is difference in the difference scores.


  5. Cathy – Yes, 56.2 is struggle territory, but 1,500 offers were made to people with ENTERs of 50 or below. ‘Unmet demand’ statistics are obvious contestable because of the assumptions that need to be made. For example, it is not just the number of applicants who receive no offer, but a discounted version of this number to take into account the fact that a significant minority of applicants reject the offers they receive. But if some of this rejection is because they receive offers for second or lower preference courses due to unresponsiveness of universities, then arguably their demand is unmet.


  6. My first hypothesis about the relative share of Catholic enrolments cannot be more than partially right. For Victoria in 2005, Catholic schools enrolled 22% of all secondary students, compared to 21% in the rest of Australia. Victorian independent secondary school market share was 18%, compared to 16% nationally. Both sectors must be outperforming their equivalents interstate.


  7. Your Education Age article highlighted a problem with central planning that isn’t often mentioned.
    Central planning is often said to be superior to markets because central planning can provide ‘fair’ outcomes where markets can’t. ‘Equalising higher education participation between the states’ is an attempt by the Commonwealth to use central planning to achieve a ‘fair outcome’. However, from a Victorian perspective, it’s an ‘unfair’ outcome as a greater share of Victorians are missing out on a Commonwealth funded place.
    The problem is it isn’t possible to get an agreement on what is fair. Any central plan designed to achieve fairness by one definition of fairness will usually fall foul on another equally valid definition of fairness. This means central planning can achieve an outcome that is fair by all.
    Markets aren’t caught by this dilemma because their legitimacy doesn’t rely on achieving ‘fair outcomes’.


  8. Those last two para from my previous response should read as follows:

    The problem is the impossiblity of getting an agreement on what is ‘fair’. Any central plan designed to achieve fairness by one definition of fairness will usually fall foul on another equally valid definition of fairness. This means central planning can’t achieve an outcome that is fair by all.
    Markets aren’t caught by this dilemma because their legitimacy relies on ‘fair processes’ not on achieving ‘fair outcomes’.


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