Two voucher schemes, ten years apart

Julia Gillard’s part response this week to the Bradley report had me casting my mind back to an unscheduled, and rather more dramatic, higher education policy launch on 13 October 1999. On that day Labor ambushed my then boss, David Kemp, with a leaked copy of his Cabinet submission to reform the higher education system. I was his higher education adviser, and reform like this was why I was in politics.

In two respects, there are close parallels between the two launches. Both proposed a voucher scheme, but neither wanted to call it that. In the Kemp plan, it was a ‘universal tuition subsidy’. In the press clippings I have kept of the time, the voucher scheme in itself did not attract much controversy. There were a couple of the usual claims about regional campuses, but most of the voucher criticism focused on an alleged broken promise not to introduce such a scheme.

But there the differences end. While Gillard immediately ruled out any increase in fees, most of the 1999 controversy surrounded the plan to uncap fees (though there was some confusion in the media, with full fees being muddled with deregulated fees).

Deregulated fees were opposed by all but a few – including by the Australian Vice-Chancellors’ Committee. For all the nice things said recently about John Mullarvey, who died last month, in his role as acting CEO of the AVCC that day he did not help their cause. He claimed that thousands of students would be unable to afford university. This made the AVCC a very unusual interest group which would simultaneously claim financial problems and reject an opportunity to fix them; and simultaneously claim student fees should be kept low and imply that its members were so untrustworthy in this regard that without regulation they would make higher education unaffordable.

Nonsense like this confirmed a growing view among some VCs that the AVCC could not represent their interests properly, and the Group of Eight began a separate organisation the following year.

There was also a lot of criticism of a proposal to put a real rate of interest on the student debt. This has always been a difficult issue; not having a real rate of interest is very expensive, but the politics of compound interest are complex for the slow payers. The compromise has been debt surcharges, which de facto do impose at least some real interest rate, with high rates for quick repayers and low rates for slow repayers.

And there was also a total misunderstanding, with claims that the submission proposed up to $800 million in funding cuts. This is is because the submission costed one option as -$798 million impact on the fiscal balance. Cabinet submissions are written from the government’s point of view, so this means $798 million in spending, but people who had never seen a Cabinet submission before reversed the meaning.

Still, there was one amusing moment amidst this political and policy disaster. The Daily Telegraph reported that protesting students, after spending some time outside Liberal Party HQ in Sydney, decided to take their demonstration to the stock exchange. But they did not realise that the ASX had moved. As the Telegraph reported, workers in the old stock exchange building were bewildered.

A couple of blocks away at the new ASX the ‘greedy capitalists’ the students hoped to disturb continued with their day’s trading oblivious to the protest.

Like disputes over fees, idiot left protestors are one of the constants of university life.