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EMPLOYMENT, EDUCATION AND TRAINING LEGISLATION COMMITTEE - 25/02/98 - DEPARTMENT OF EMPLOYMENT, EDUCATION AND TRAINING AND YOUTH AFFAIRS - Program 2—Higher education policy - Program 2.1—Higher education system

Senator CARR —Could you provide me with figures for the amount of money that was collected from up[hyphen]front payments of HECS in the full year 1996[hyphen]97.

Mr Mutton —I am not sure if we have answered that in a question on notice, Senator. You asked quite a lot of questions of that nature last time. I cannot recall if that was specifically one. If we have not, we will provide an answer.

Senator CARR —There are a number of issues I will need to canvass, some of which I may well have canvassed in other areas. If I have, I apologise, but could you draw my attention to that answer.

Mr Mutton —Question No. 490 asked what up[hyphen]front payments of HECS totalled in 1996[hyphen]97 and then in 1997[hyphen]98 to 2000[hyphen]01. They range from $208 million in 1996[hyphen]97 through to $304 million in 2000[hyphen]01. The full answer is in question No. 490.

Senator CARR —Thank you very much. Can you indicate to me how much HECS, paid independently of the tax system but not up front, amounted to in the full year 1996[hyphen]97. Presumably you will remind me of which question I have already asked that under.

Mr Mutton —I am not sure I understood the question.

Senator CARR —Paid independently of the tax system but not up front.

Mr Mutton —Unless I am missing something, it is either one or the other. There are voluntary payments which you can make after the census date and, if you pay more than $500,
there is a discount of 15 per cent. There is an answer to that question. It is No. 493, if that is what you are getting at.

Senator CARR —Thank you. That covers that very well. In the answer to No. 590, regarding RMIT and the reduction in HECS funded places in the business program and in applied science, as I read your answer you are essentially saying that, because the university as a whole is providing an appropriate number of HECS funded places, individual departments are not in breach of the guidelines in reducing the HECS funded places. Is that the way it works?

Mr Gallagher —You may be confusing two different matters here. The first is whether RMIT was deliberately reducing its publicly funded places to make room for fee paying students. The answer goes to the outcome of our discussions with RMIT, which went to the fact that they were over[hyphen]enrolled—substantially in business, as it happened—and sought to manage their position better against the new policy for marginal payment for under[hyphen] and over[hyphen]enrolment. That is for the institution at large.

The second matter of the 25 per cent relates to enrolments in a particular award course, and that is not affected by this. The fee paying offerings were less than six per cent of business places.

Senator CARR —That is overall business. So you do not believe they are in breach of the guidelines in regard to business? What about applied science?

Mr Gallagher —Applied science: 1.3 per cent.

Senator CARR —You do not believe that is in breach of the guidelines?

Mr Gallagher —It is certainly not 25 per cent.

Senator CARR —I will return to the answer to question No. 494, where you are suggesting that in the department's view there is a predicted growth in HECS debts from 1997 to 2001 of 73 per cent while in the same period you are predicting a drop in the number of HECS debtors of three per cent. Is that the case? I am wondering how we can reconcile those two figures.

Mr Mutton —Would you repeat the figures as I have just found the question?

Senator CARR —You are suggesting there is a 73 per cent increase in the growth of HECS debts. Is that right?

Mr Mutton —Yes. I have not done the figure but that looks all right.

Senator CARR —In the same period there is a predicted drop in the number of HECS debtors of three per cent. Is that right?

Mr Mutton —Yes.

Senator CARR —How can you explain that?

Mr Mutton —Differential HECS. Firstly, there are increasing numbers of students and, secondly, they are paying more increasingly over time as differential HECS works through.

Senator CARR —In regard to question No. 492, I asked on what basis had DEETYA calculated or estimated the number of payers of HECS debts through the tax system until the year 2000[hyphen]01 for the projections that were provided in response to question 492. How far is this increase in payment expected to be due to the lower threshold or repayment?

Mr Mutton —Substantially so, because of the lower threshold.

Senator CARR —What other considerations were regarded as relevant in making this estimate?


Mr Mutton —I am not sure that I was involved in the making of the estimate. I could take that on notice, but when I asked the question the answer was that it was substantially related to the threshold coming down.

Senator CARR —Of what order? You say `substantially'. To what effect is `substantially' in this context?

Mr Mutton —I was simply asking what were the principal things resulting in such big increases, and that was the answer that I had.

Senator CARR —In answer to question No. 491, you provide estimates of the number of students who have elected to pay their HECS charge up front to the year 2000. You say the estimates are based on the assumption that a constant 29 per cent of students will continue to pay up front. Is that correct?

Mr Mutton —Yes.

Senator CARR —Do you believe that, despite an increase in the level of HECS charges, the same proportion of students will continue to pay?

Mr Mutton —It is a working estimate. I think we have to wait and see what the experience is this year.

Senator CARR —What is the assumption?

Mr Mutton —The assumption is that it will not change—on the basis that we do not know what factors might be at work. Some people might be more inclined to pay, given the debt will increase, and others, given that the up front payment is greater, may be deterred. In part for that reason the government decided that it would provide a discount for payments of more than $500 up front rather than the whole amount up front.

Senator CARR —Do you believe that, as a result of increases in charges, some students will choose to defer payments? Will that have an impact on that calculation?

Mr Mutton —The assumption here is that it will stay the same, but we have to see the experience before we determine that.

Senator CARR —Are there any other assumptions that the department has relied upon in drawing this conclusion?

Mr Mutton —I think it is simply a working assumption. In the absence of clear implications one way or the other we would maintain the same percentage.

Senator CARR —That is your view.

Mr Mutton —We do not know.

Senator CARR —That is your best guess, and no[hyphen]one else has been able to provide you with a better guess?

Mr Mutton —That is right.

Senator CARR —Fair enough. Recently in Victoria there has been some discussion about proposed changes to teacher education. Mr Gallagher, can you provide the committee with any advice on the amounts of money that the state of Victoria pays towards teacher education at Victorian universities?

Mr Gallagher —I will have to take that on notice.

Senator CARR —Thank you. As I understand from sources, the state is now providing less than one per cent of the operating moneys for universities. Is that the department's estimate?


Mr Gallagher —In aggregate, but you may recall that a couple of years ago the state government of Victoria injected some additional growth places for a period of time.

Senator CARR —How much was that?

Mr Gallagher —I think it was a three[hyphen]year sunset program. I will have to check the figures.

Senator CARR —As for the general proposition of states now providing one per cent of moneys towards the universities' operating costs, would that be correct or not?

Mr Mutton —That would be tops.

Senator CARR —Tops?

Mr Mutton —Yes. I will see if I can find a figure.

Senator CARR —Thank you. So in regard to the teacher education programs the situation is not likely to be any different? So the departments of education in universities are not likely to attract any additional moneys?

Mr Gallagher —For professional development there are state contributions.

Senator CARR —Yes, but for the training of teachers—that is, the initial training?

Mr Gallagher —For initial undergraduate teacher education that is almost—

Senator CARR —It is actually postgraduate, by and large, but there would be some undergraduate. I agree they are concurrent degrees. But are you aware of any additional moneys provided by state government?

Mr Gallagher —No.

Senator CARR —So the estimate of one per cent tops would be about right in your judgment?

Mr Gallagher —It would be in that ballpark, yes.

Senator CARR —There has been a public debate in recent times regarding the number of universities that have enrolled up-front fee paying Australian undergraduate students. I understand that eight public universities are now engaging in such programs. Is that correct?

Mr Mutton —There are seven, with another introducing that from mid-year.

Senator CARR —So it is seven currently but it will be eight within a few months?

Mr Mutton —Yes.

Senator CARR —Are you able to provide the committee with advice on the number of applicants for up-front fee paying places by course and institution?

Mr Mutton —I do not think we can provide it by course and institution—probably by state.

Senator CARR —You can provide it by state but not by course or institution?

Mr Mutton —I do not think so. I seem to recall someone saying that the Victorian ones were being treated as a whole.

Mr Gallagher —I can give you state figures.

Senator CARR —If you would not mind. I would seek those. I would take any advice you could provide.

Mr Gallagher —Do you want them here?

Senator CARR —Yes. I am interested in the report that appeared in the Campus Review . If you have them here in a tabled form, I will take them if they are available. Are they able to be tabled?


Senator Ellison —There is no problem with that.

Senator CARR —I noticed a report in the Campus Review of 11 February. Mr Gallagher, are you aware of the claims made by Carolyn Allport in the Campus Review of 11 February suggesting that the number of students engaged in up-front undergraduate fee paying courses would involve revenues of no more than $5 million across Australia?

Mr Gallagher —I recall the article. I do not know on what basis—

Senator Ellison —Do you have a copy of it there? It might be of assistance to us.

Senator CARR —The secretary has gone off with a copy of the article, presumably to photocopy it for you. I had a copy for you. The hour is late.

Senator Ellison —Do you want to move on to the next question while we wait?

Senator CARR —We might come back to it on Friday. What I am seeking from you is whether you would agree with those assessments of the numbers.

Mr Mutton —We cannot know the numbers or the mix and therefore the revenue for some time yet. Universities projected 1,300 undergraduate fee paying places in 1998, and we estimated on some rough average assumptions that that would produce revenue of $13 million.

Senator CARR —I would ask you to examine the claims made in the article printed in Campus Review of 11 February which details, basically state by state, university by university, the number of places offered and the number of acceptances, which I presume Dr Allport has information on. I ask whether the department can give me their assessment of the veracity of those claims.

Mr Mutton —I do not think we can prove something we do not know yet or will not know by Friday, but we can give what we do know.

Senator CARR —That is basically what I would be seeking from you.

Mr Mutton —The processes have not been completed for determining who is enrolled but they shortly will.

Senator CARR —It is claimed, for instance, that the number of first round offers for the University of New South Wales is 21; Monash, 175; University of Sydney, 60; Adelaide, 12; University of Melbourne, 220—of which 200 were in fact scholarships; Deakin, 50; RMIT, 29; and CQU, none.

Mr Mutton —CQU is the one that has not started yet—mid-year.

Senator CARR —It has been proposed that on that basis there will be a revenue of $5 million, so I seek some assessment from you on that matter. Perhaps, Minister, given the hour, we might want to—

Senator Ellison —Is there any chance of finishing 2.1 tonight?

Senator CARR —No. I suggest we adjourn the consideration of the program until Friday.

CHAIR —This hearing will now adjourn until Friday morning. As per the program for Friday, it will be 9 o'clock to 3.45. We will consider the rest of program 2, program 5 and program 6. Program 4 will be considered in the following week, as will those aspects of program 6 that relate to program 4.

Senator CARR —And other matters relating to the question of consultancies. I am sorry to pursue this but we have had difficulties in this committee and before on these matters. That is why I wanted to be clear.


Senator Ellison —It is on the record that it will be dealt with on Friday of next week, not Friday of this week.

CHAIR —Although the schedule indicates that this coming Friday we are to start at nine, the minister has made a request that we start earlier. Do we need to have a private meeting about this?

Senator CARR —No. What time do you want to start?

Senator Ellison —At 8.30.

CHAIR —Is that agreed?

Senator CARR —Yes.

CHAIR —We will continue with program 2 at 8.30 this coming Friday.

Committee adjourned at 11.01 p.m.