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Overseas students are getting harder to attract and unis will feel the squeeze

By Steven Schwartz - posted Wednesday, 9 February 2011


Prince Charles took his wife for a spin in the family Rolls Royce through London last month and entered a maelstrom.

Demonstrators protesting over funding cuts to universities surrounded the Prince’s ancient Rolls Royce and proceeded to decorate it with rotten eggs. The Prince and the Duchess escaped unscathed; higher education was not quite so lucky. And the turbulence created by that maelstrom will not be localized to the UK - it is only a matter of time before it has an impact in Australia.

What will be its effect here? To try to answer that question we have to examine emerging global trends and what they will mean for our universities.

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While demonstrators terrorised the Prince out on the street, inside the Palace of Westminster, Parliament voted to increase the upper limit on the tuition fees charged by English universities. (Wales, Scotland and Northern Ireland have different systems).

As the demonstrators made clear, the fee increase was not popular with students. It was also unpopular with politicians. Thirty members of the governing coalition refused to support the increase, which passed with a tiny majority.

The new cap on university fees is £9,000 ($14,400). This is almost triple the current limit and 50% higher than the top fee charged to domestic students by Australian universities, which is around $9,000 for subjects such as law and medicine. (There are no official caps on the fees charged to foreign students).

Like Australia, no English student will be required to pay university fees up front. The UK government will lend students the money and collect it back through the taxation system.

The English fee increases coincide with steep decreases in taxpayer funding for higher education. The UK government has announced significant cuts to university teaching grants and a 40% or greater reduction is expected.

Subjects not considered vital to the economy (more or less everything apart from health, science and technology) will attract no government funding at all. This means that students who wish to study history, literature or philosophy will have to fund the entire cost of their education.

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Shifting the responsibility for university funding from the taxpayer to graduates, and adding austerity measures on top, is becoming a global trend which will eventually have an impact in Australia.

Newly elected California governor Brown proposes cuts of more than $1 billion in the taxpayer subsidies paid to higher education institutions in California. This follows two successive years of budget cuts and academic salary reductions.

The latest cut takes state funding for higher education back to the level of 1999. To make up for the lost revenue, California has increased tuition fees, which are up by one-third. For the first time in the state’s history, student fees constitutes a larger part of university budgets than taxpayer funding.

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About the Author

Steven Schwartz is a former vice-chancellor of Macquarie University.

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