Cheap Loans Will Push Up Students' Fees, Unions Claim

Sydney Morning Herald

Saturday June 16, 2001

Cynthia Banham

A new scheme to lend money to postgraduate students would lead to higher university fees, according to several education groups.

The Postgraduate Education Loan Scheme (PELS), the Federal Government's attempt to reverse falling postgraduate enrolments, allows students to obtain interest-free loans for the full cost of a course.

Enrolments in postgraduate courses dropped 19 per cent between 1996 and 2000.

Enrolments in visual arts postgraduate courses fell 30 per cent, humanities (28 per cent), sciences (22 per cent) and education (21 per cent) from 1997 to 2000, according to Department of Education, Training and Youth Affairs figures.

The cost of postgraduate courses under PELS can be set by individual universities, and is different from the undergraduate loans scheme HECS, where students are able to obtain loans for a partly subsidised course.

In evidence to a parliamentary hearing into the bill to implement the scheme, education groups argued that the scheme would push up postgraduate fees as enrolments increased.

Ms Kate Davison, education spokeswoman for the National Union of Students, said higher fees should be regulated because of a ``tendency to arbitrarily increase fees of courses".

The National Tertiary Education Union expressed concern over the Government's plans to cap student debt, at a level to be determined by the minister.

Under the provisions, once a student passes the capped level of debt which includes HECS and PELS they face having their course suspended.

``It may be having reached that debt level [students would be issued] suspension notices, and students would be left with incomplete courses, with those conditions remaining in place until the debt was paid," said the Tertiary Education Union policy officer, Mr Greg McConville.

The union advocated capping postgraduate feesas an alternative to controlling student debt.

It also argued that the scheme should be limited to public universities and not private ones such as Queensland's Bond University.

Other concerns aired by the union included that students who opted for the postgraduate loans would immediately forfeit their right to a tax deduction.

Mr McConville said this would have grave implications for the nurses and teachers, as many undertook further studies to increase their qualifications while on the job.

The union also argued that the scheme could act as a disincentive for employers who assist employees undertaking postgraduate studies, and could shift the full cost to students.

The National Union of Students said the Government's scheme could act as a model for extending unregulated fee charging to undergraduate courses, and accused the Government of harbouring plans to eventually introduce full university fees.

Labor Senator Kim Carr said that while a measure to address problems in the postgraduate sector was ``better than no measure at all", it still contained serious implications for equity for students and fee increases, and advantaged the prestigious universities.

© 2001 Sydney Morning Herald

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