When yesterday I admired Julia Gillard’s chutzpah in stating that her voucher scheme isn’t a voucher scheme I did not expect anyone would believe it. But she has shown that if you spin brazenly enough people will believe you. Not only does the SMH buy Gillard’s non-existent distinction without negative comment, it adds an embellishment in its favour that is not in the published version of Gillard’s speech:
Ms Gillard said the change in funding model was not the student voucher system advocated by Professor Bradley.
Alas, it is exactly the voucher scheme advocated by Denise Bradley, with a slightly later starting date. Gillard has ruled out deregulating HECS price caps, leaving the system entirely reliant on the government subsidy creating the prices per student place that will be the incentives to drive a demand-driven system. For reasons explained in my recent CIS paper, I have no confidence that this will occur. Like Bradley, Gillard shows no sign that she understands this issue, much less that she has a solution to it.
At least Monash VC Richard Larkins was alert to one consequence:
Richard Larkins said abolishing caps on student numbers, while retaining them on the HECS amounts universities charged, could create “perverse incentives” to enrol more international or postgraduate students, who are not subject to price caps.
Exactly.
Andrew Norton 
It will be interesting if the Commonwealth adopts Bradley’s recommendation that providers be able to offer full-fee domestic undergraduate courses providing there are no public subsidies. (Rec 35) Will this mean that where a provider believes there is sufficient demand for a course at a price they can profitabily provide it, but the government isn’t paying enough for it, the provider will only offer the course on a full fee basis? Wouldn’t that be a great outcome!
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I understand that the Bradley report has set a 2020 target of having 40 per cent of 25-34 year olds obtaining an undergraduate degree.
Is there any rationale underlying this number, in terms of a cost benefit analysis? That is, why is this particular target desirable, even assuming it has been achieved?
Or is it, as I suspect, a feel good number plucked out of thin air?
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Tyler – One of the ironies of the higher education debate is that skills supposedly gained through university study, such as critical thinking, evaluating evidence, and intellectual rigour, are very rarely applied when discussing higher education policy.
The Bradley committee did commission research from Access Economics and Bob Birrell on this question. Both concluded that more graduates were needed; neither recommended the 40% target. It does seem to have been picked out of the air.
I have more on it here.
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I would have thought that ‘perverse’ incentive already existed?
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Mitch – It does in adding new places, but I think Larkins’ point is the one I make in my paper, that abolishing the funding agreements creates an opportunity to reduce Commonwealth-supported places and replace them with fee-paying places.
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Well, as long as student loans like FEE-HELP are available to students on full fee places, then a reduction in Commonwealth-Supported places are not necessarily all bad. This way, universities get more funding, the drain on the Commonwealth’s finances are reduced, and students will still be able to get access to education without paying upfront. Students will have to pay more for their education, but at this they don’t have to pay it back until they’re earning a reasonable amount of income.
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Matt, the problem is that they have also phased out undergraduate full fee places for non-international students.
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