SUBJECTS: Job-ready graduates, International students
Hamish Macdonald: The Federal Education Minister is in our Parliament House studios this morning. Good morning to you.
Dan Tehan: Morning, Hamish. How are you?
Macdonald: Very well thanks. Dan Tehan, the Government is promising these extra 100,000 places by 2030 to meet the growing demand, but without investing significant extra funding to cover the additional places. I’m reading that it’s budget neutral over the forward estimates. But, what then gets cut? Who loses out?
Tehan: So there’s, there’s no cuts, Hamish. Our higher education budget will continue to grow. What we’re doing is we’re realigning funding so that we can create these new places, these 39,000 new places. And, in particular, what we want to do is align the cost of the degree with the contribution of both the student and the Government is making so that they better align, and then we’re going to give discounts in those areas where we know there are going to be jobs in the future, where we know we have to get students getting the skills that we need them to have, so they’ll be able to take the jobs of the future.
Macdonald: Can we be clear about this? You’re saying that you can create an extra 100,000 university places without spending an extra dollar?
Tehan: Well, I’ll outline at the Press Club exactly what the Government’s plan is. But, what I’m saying is …
Macdonald: … Sure, but I think an answer to that question is important. Can you do that? You can, you can educate an extra 100,000 people, without spending any more money?
Tehan: No. We’re already spending more money in the higher education sector. Money continues to grow in our budget for the higher education sector, and it will continue to grow. We have worked with the sector, with industry, in designing this package that we will be announcing at the Press Club today, and what it means is that we can put another 100,000 places into the system. And, we can also make sure that we align costs with the contribution both the student and the Government makes, and ensure that we’re getting individuals, we’re getting students that have the skills that they need into the future.
Macdonald: So, what does that mean? Aligning the cost of the student and the university makes with what the Government pays? What do you mean by that?
Tehan: So, what it means is that each year we undertake an analysis with universities around what it costs for them to teach a degree, and in 2018 Deloitte’s did a study using material provided by the university sector around the cost. Now, what has happened is the contribution both the Government and the student are making in some areas is above the cost, in other areas it’s below the cost. So, what we don’t want to see is arts students subsidising courses, and we don’t want to see, we don’t want to see teachers and nurses subsidising courses, either. We want to align those costs accurately, and that’s what we’re designing as part of this package.
Macdonald: So, you’re saying that you want an education system where you pay the actual cost of the degree? Is that what you mean?
Tehan: That’s, that’s absolutely correct. But, what the Government is doing, as well, where we know there are job shortages in areas like teaching, in nursing, in allied health, in engineering, we’re going to pay more and the student will pay less, so that we incentivise the student to study in those areas where we know there will be jobs. We’re facing the biggest economic downturn since the Great Depression. What we have to make sure we do is that we educate our young people in the areas that we know where the jobs will be, and this is what this is designed to do.
Macdonald: Are you penalising, though, people that might not fit into some of those areas of study? You know, a maths degree, as I understand it, will come down in cost, some 62 per cent. You’d end up paying $3,700 for a year of study in that area. But, then, if you’re doing something in humanities, you’d have an increase of 113 per cent to the cost of it, going up to $14,500. I mean, that’s huge disparities.
Tehan: Well, Hamish, what we want to see is that, if you’re thinking of studying philosophy, study a language, as well, because that will bring the cost of your degree down, and, we think, will help you with your employability when you finish. If you’re thinking of studying law, think also of studying IT, because that will bring the cost of your degree down and make, you know, improve your employability. So, we don’t want degrees to be siloed. We want students to be mixing and matching at a unit level, and really thinking about the skills they’ll need to get jobs into the future. And, we want …
Macdonald: … Can I just ask, though? This is a radical change in the way you want young people to make decisions about their path of study. It sounds like, you know, when you go each semester to choose which course you’ll be, you’ll be studying, there’ll be a price tag on it. That’s what, that’s the result of this, isn’t it?
Tehan: Well, there’s always been a price tag on studying at university …
Macdonald: … Sure, but, I mean, when you’re making your choices each semester, you wouldn’t have been saying, well, if I do this course, it’s going to cost me this much. If I do that course, it’ll cost me that price. That’s what will happen here, isn’t it? Because, you’re saying that you want people to choose electives that are in IT, in mathematics, in science, in English, for example.
Tehan: Well, students have always had to pay a cost and that, we’ve got the best fee help scheme in the world. And, what we want to do is make sure that students are conscious that they do have a cost that comes with studying, and we also …
Macdonald: … Do you want that, you want them to be thinking with each subject they choose, what the specific cost of that subject will be?
Tehan: Well, what we want them to be thinking of is, are the subjects that I’m going to be undertaking going to give me the skills that I’ll need to get a job when I finish my degree? That’s what we want them thinking of. We’ve got to understand that the unemployment market is growing, sadly, as a result of the coronavirus pandemic. We’re facing a contraction of our economy, the like we haven’t seen since the Great Depression. So, we want to make sure that our students have the skills in the areas that we know where the jobs will be, because we’re going to need them to grow our economy out of this coronavirus pandemic, and we want them to have the skills to be able to do it.
Macdonald: Isn’t going to university also about expanding your mind? Not just getting a job at the end? I mean, don’t you need to be doing things that do change the way you think? That do take your mind to other places, other than just a course that is going to lead you into a job that you know is available?
Tehan: Absolutely, it’s about expanding and broadening your mind, and we want students to be thinking about those things and undertaking subjects in those areas. And, that’s why …
Macdonald: … But, you don’t, you’re saying you’re trying to incentivise other things, which creates a disincentive to do something like philosophy.
Tehan: Well, in the end, we want those people who do philosophy to have the skills to be able to use what they’ve learned in the job market, and that’s what this is designed to do. We, our humanities degree, our law degree, our commerce degrees, are cheaper than in the UK, than the US, so what we want to do, though, is make sure that people who undertake those courses also undertake subjects which give them the skills, so that they can put that critical thinking to use in the job market. That’s at the heart of what we’re trying to do.
Macdonald: Do you expect this, these new places to actually result in a significant number of new positions in the coming academic year?
Tehan: That is correct. That’s what it’s designed and aimed to do …
Macdonald: … So, how many next year? How many new places next year?
Tehan: We’re hoping that we’ll be able to put 12-14,000 places into the system next year because, as we’ve seen, we need to be able to meet that demand, and one of the things that gives us real confidence that we’ll see this demand come in is through our short courses. We did those in these areas of national priorities where we’re making it cheaper for students to study, and the uptake we’ve seen there has been quite extraordinary. Over 50 higher education providers have offered over 350 courses, and we think, roughly, 20,000 students have taken up these short courses in these priority areas, where we think that the jobs of the future are going to be, and are aiding students right now to get the skills that they need to take those jobs.
Macdonald: Twelve to 14,000 places though is not going to help the universities make up the shortfall, as in, what they’ve lost with overseas students.
Tehan: Well, obviously, as you know, we’re also working with the university sector when it comes to international students. International students create 250,000 jobs here in Australia. They provide $40 billion worth of income. So, we’re about to start pilots with the ACT and South Australia based on medical expert advice, bringing students in if we can get the final tick off, and, once again, if those pilots work, well, we’ll be able to work with the sector when it comes to starting to open the international student market again. But, what these reforms are all about is focusing on domestic students, and making sure for Australian students, they’re getting the skills that they need for the jobs of the future.
Macdonald: Dan Tehan, thank you very much.
Tehan: Thanks Hamish.