Budget 2016: University fee deregulation scrapped but universities still facing big cuts

The Federal Government has abandoned its policy of full university fee deregulation, but is still banking $2 billion in savings from the higher education sector.

Key points:

Deregulation plan dumped in face of community concerns

Universities still facing 20pc funding cut

Sector overhaul to be finished "later this year"

The proposal to allow universities to set their own course fees sparked claims degrees could cost $100,000 or more.

The Government has walked away from the controversial proposal, citing community concerns and evidence about the financial impact on the FEE-HELP student loan scheme.

But a 20 per cent funding cut for universities, also announced in the 2014 budget but yet to pass Parliament, remains on the table.

The Government said it hoped to finalise an overhaul of the multi-billion dollar sector later this year, with changes now set to start a year later on January 1, 2018.

It has outlined a range of potential changes, including lifting the student contribution to course costs to 50 per cent — up from about 40 per cent currently.

Options it has floated include:

  • Reducing the income level where repayments start from about $54,000 to as low as $40,000.
  • Introducing an across-the-board student loan fee to help recover costs for the HELP loan system.
  • Increasing repayments from high-income earners.
  • Introducing partial fee deregulation for certain flagship courses.

"There is a clear need to reduce HELP expenses in order to preserve the scheme's long term affordability and viability," a Government document said.

"The Government believes that with some further modest changes, student loans can remain affordable, while continue to represent a good deal for taxpayers into the future and, most importantly, will continue to underpin equitable access to higher education."

An expert advisory panel will be established to help finalise changes.

In handing down his first budget on Tuesday night, Treasurer Scott Morrison told Parliament now was not a time to be "splashing money around".

Source: ABC News

Leave a Reply

Your email address will not be published. Required fields are marked *