Here’s How The Government Is Planning To Cut University Funding

Get ready to pay back your HECS debt sooner.

hecs debt

We missed you too. Sign up to our newsletter, and follow us on Instagram and Twitter, so you always know where to find us.

Well, the Government just closed out a shitty year in politics with some cuts to higher education funding, because please, kick us while we’re down.

Earlier today, Treasurer Scott Morrison delivered the Mid-Year Economic and Fiscal Outlook (MYEFO), which is basically an update on the budget delivered in May. If you cast your mind back to May, you may remember the government proposing big cuts to higher education back then, which included slashing uni funding, raising fees, and making you pay back your HECS debt sooner.

Those original changes were blocked in the Senate earlier this year, but in today’s MYEFO, the government has reintroduced very similar changes, and Morrison said the vast majority of them won’t even need to go through the Senate this time around. Fun!

What Are The Changes?

The cuts proposed today are worth $2.1 billion, compared to the $2.8 billion cuts proposed in May.

Under the proposal, graduates will have to start repaying their HECS debt once their annual income reaches $45,000 (that’s higher than the $42,000 threshold proposed in May, but way lower than the current threshold of $54,000. There will also be a lifetime limit on how much you can borrow from the Government as part of HECS-HELP to pay your uni fees — $150,000 in total for medicine, dentistry and veterinary science students, and $104,440 for everyone else. You can find out more about these proposed changes here.

Both of these measures need to pass Parliament to be implemented, and they’re likely to face some opposition there, so it’s not a totally lost cause yet. Some of the other measures proposed in the bill will likely not need to pass Parliament, though, because they’re a funding freeze rather than new legislation.

Basically, the government wants to freeze funding to the Commonwealth Grants Scheme at 2017 levels for the next two years. This is likely to lead to places at university being capped, because it means that funding won’t adjust in response to inflation, nor will it adjust in response to the numbers of students a uni admits.

The government has justified the cuts by saying they’re necessary to ensure higher education costs remain sustainable over time.

“Australia must face up to the task of putting our higher education costs on a more sustainable, responsible path for the future while also having a stronger focus on supporting students,” Education Minister Simon Birmingham said.

“Collectively, these measures maintain widespread access to higher education and generous funding for universities while being more affordable for taxpayers by stopping universities from effectively writing their own cheque.”

This Seems…Bad?

The proposed changes have already been slammed by Labor, the Greens and Universities Australia.

Universities Australia said the cuts would leave university funding “frozen in time”, forcing them to cut student places. “Even if a university simply seeks to maintain its current number of students, this would mean a real cut,” Universities Australia Chair Professor Margaret Gardner said, noting that the cuts would hit hardest in regional Australia.

“A freeze will put budget pressure on universities to offer fewer places in courses that are expensive to teach but hugely needed such as nursing, science and engineering.”

“Mr Turnbull is robbing students to pay multinationals and millionaires,” Shadow Minister for Education Tanya Plibersek said in response to the changes, pointing out the the government could easily make much bigger savings by halting its tax cuts for big business. She said the changes “will see students miss out on uni places, bigger lecture and tutorial sizes, and will compromise the quality of teaching and research”.

The Greens, meanwhile, called today’s MYEFO a “mean-spirited” move that “unfairly targets young people”.

“This budget once again screws over young people,” Richard Di Natale said. “While Turnbull strips $2.1 billion out of our universities and students, big multinationals and corporate fat cats continue to avoid paying their fair share of tax.”

“Most of today’s politicians enjoyed a free university education, affordable housing and secure jobs with steady wage growth waiting for them when they graduated. None of this will be available to the current generation of young Australians unless we dramatically change course.”