The cost of higher education in Australia has risen significantly in recent years, with fees amounting to around $17,000 per year of study. The income-contingent philosophy behind the Higher Education Contribution Scheme (HECS) was originally designed for students to start repaying their debts once their taxable income reached average weekly earnings. However, students now begin repaying at a threshold barely over half of that amount, with the additional tax to recoup loans ranging from 1 to 10 per cent on top of graduates’ marginal tax rates. This increase in student fees is largely due to the Job-Ready Graduates Package introduced in 2020, which aims to incentivise students to choose job-relevant courses by adjusting student contribution amounts based on expected job growth and demand in different fields.
The Job-Ready Graduates Package saw significant increases in student fees for some courses, such as humanities, which more than doubled, while lowering costs in others. Education Minister Dan Tehan justified these changes by stating that they were meant to encourage students to choose fields with high job demand, such as teaching, nursing, agriculture, and STEM (science, technology, engineering, and mathematics). However, data and research have shown that the assumptions behind this policy are flawed. Recent graduates with degrees in society and culture and commerce, which experienced the highest fee increases, actually have better employment outcomes than STEM graduates. Additionally, while there is growing demand for health and IT qualifications, the overall demand for STEM skills is not increasing as anticipated.
Despite the government’s efforts to incentivise students to choose certain fields by adjusting student fees, enrolment patterns have not changed significantly. Agriculture and related studies, which have the lowest student contribution percentage at 13% of course costs, have seen declining enrolments and slow growth in qualifications demand. The government’s proposal to wipe 20% of student debts if re-elected could be seen as an acknowledgment that the burden on students under the current system is unfair, but it fails to address the flawed assumptions and elements of the Job-Ready Graduates Package. The package is hindering the educational aspirations of many young Australians and burdening them with unnecessary debt.
As the upcoming federal election approaches, young people are being encouraged to consider the impact of the higher education system on their future. With housing affordability being a significant issue, the cost of university education is something that young Australians can demand fairer deals for from both major political parties. It is argued that the current system is placing unnecessary financial strain on students, and reforms are needed to address the flawed assumptions and inequities within the Job-Ready Graduates Package. The outcomes of the election could have a significant impact on the future of higher education in Australia, and young voters have the power to influence the direction of policies that affect them directly.
