When a voucher isn’t a voucher

More later on the first instalment of Julia Gillard’s response to the Bradley report, which includes accepting the recommendation to ceate an uncapped demand-driven scheme, but her speech to the Universities Australia conference contains this gem:

Let me be clear about one important point: this is not a voucher.

Students will not be receiving a set dollar entitlement to be redeemed at an institution of their choice. Rather, there will be a Commonwealth payment to universities – with the amount varying depending on the course – on the basis of student numbers.

The core idea behind ‘vouchers’ is that public subsidies be allocated on a market basis.

The actual choice of technology – distributing bits of paper called ‘vouchers’ or cards (like Medicare) or a report-and-audit system with suppliers (as with private schools) – is a management decision, and not fundamental to the underlying idea. Where the eligible persons are easily identified, such as any Australian citizen or permanent resident in the case of schools and Gillard’s proposed higher education system, report-and-audit is likely to be the cheapest and therefore the best option. Nobody wants pointless distribution of bits of paper from Canberra (except maybe DEEWR, experts in bureaucratic make-work).

Nor is the idea of a flat amount intrinsic to the idea of a voucher, though if it is to be a subsidised though otherwise undistorted market like cases should be treated alike. For example, in Medicare there is a higher rebate for specialists than GPs, but no government steering between specialists or between GPs. The private school system is an impure voucher scheme, because public schools receive much higher per student subsidies than private schools for teaching the same things. It looks like Gillard is proposing a pure voucher scheme for higher education, with subsidy depending on course of study rather than institution.

She isn’t the first to have to deny that a voucher is a voucher. But why the concern about this word? It has become taboo because public-sector education unions are very powerful in left-wing politics, and they have mobilised for decades against student and parental choice, which would undermine their influence on education and threaten the jobs of their incompetent members. This passage in Gillard’s speech is for them. Luckily, much of the rest of it is not.

5 thoughts on “When a voucher isn’t a voucher

  1. I just read about the changes online and was starting to get excited so thought I’d drop by, knowing you’d have something to say.

    Clearly an example of doublespeak, but at least the policy is headed in the right direction.


    “There will be a new national regulatory agency to provide further checks and balances.”

    What’s this crap, though? I can understand having standards for primary and even high school education. But I’d figure by tertiary level there wouldn’t be much of a need for regulation… Students should surely be able to work out which Unis are worth sending their money to?


  2. Funnily in one article Gillard says that HECS caps won’t be removed. And in the other she complains about student:staff ratios.

    I think someone should tap her on the shoulder and remind her “you can’t have both, darling”. At least not without negatively impacting employment by raising taxes to fund…


  3. I was interested in the response. To my mind the scheme had to have two parts. Access to all, to give those that don’t perform in high school a second chance and standards.

    You need standards because the student wants to get through and the university wants to keep the student. I know there are people who believe one university offers a glorious degree while another doesn’t. In reality no one really cares, the employer just wants some sort of standard maintained.

    Mind you because the course is so poorly targeted this employer won’t hire engineering graduates from Melbourne uni. You can pick up graduates with solid technical training from Monash, RMIT and Swinburne so why bother. This is not a case of poor standards but a poorly targeted course ( from my point of view).

    Still don’t like HECs, however it can be argued that having to pay increases the incentive to get through, and if your parents can’t pay you can put it off. And at least they have put a cap on it. It will be interesting to see how the difference is funded.

    So all in all I think it’s a good scheme to move forward with and obviously so do a few others.


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