This is another non-debt post. I’ve just heard Costello describe tonight’s budget as an “Education Budget”. There was a welcome “equity” bequest to universities, to fund infrastructure and research: but there was also a shallow “shell and pea” trick in the allocation ofÂ funding for University places.
The complicated CGS banding system–which determines what theÂ GovernmentÂ provides per student, and varies depending on the discipline being studied–is being rationalised from 14 bands to 7. In 6 of those new bands, the amount being given in 2008 is slightly more than the highest amount given to the previous bands. For instance, the four bands of Maths, Behavioural Sciences, Education and Computing are being amalgamated into one band; the highest funding level per student in 2007 was $8,057 for Computing, and the lowest $5,381 for Maths; the new funding level is $8,217–a 2% rise for Computing, and a 52% increase for Maths.
I certainly don’t disparage the funding boost for Mathematics–God knows mathematics education deserves better support in this country. But the whole thing is being funded by a dramatic reduction in funding for business students.
In one and only one band, the new amount is only slightly larger than that given for the lowest–funded band in 2007. Law and Business are being banded into one; previously, Law got a paltry $1,642 per student, and business got $2,703 (the second lowest amount); now the combined band will get $1,674 per student: a 2% boost for Law, but a 38% cut for business.
Needless to say, with Commonwealth funding as low as it is now, this sharp a cut would bankrupt most Business Faculties in Australia–it would certainly bankrupt mine. So the Government will enable us to top up their drastically reduced funding by increasing HECS: Business disciplines are being moved from HECS contribution Band 2, which has a $7,188 ceiling on what Universities can charge students, to Band 3, with a $8,333 ceiling (page 15Â inÂ icss_booklet_2007.pdf from www.goingtouni.gov.au).
So this budget takes over $1,000 out of University funding per business student, and replaces it with up to $1,145 more from each student.
The Government’s rationale for this move is that “CGS funding for Accounting, Administration, Economics and Commerce will be adjusted downwards to match the Commonwealth contribution for Law reflecting the commercial nature of these courses” (Budget Paper 2, Page 115).
If there’s any rationale to this, it’s the belief that business and law students earn squillions and are in it for the cash, whereas other professions are there for love and earn a pittance.
The Budget Overview confirms this with the statement that: “The cap on the HECS-HELP fee and the public subsidy for Accounting, Administration, Economics and Commerce will be aligned with Law to reflect the high salaries that graduates in these disciplines receive” (page 11).
So hit the rich with the tax and let the poor in free–an admirable socialist principle… However, even that Bolshevik logic doesn’t cut the mustard. The starting salaries for business careers are certainly not the highest in the land, nor are they comparable in any way to salaries in Law. Check:
There you will see that the minimum salary for Accounting (which I presume corresponds to what new graduates can expect) is $37,000–versus $39,000 for a teacher, $41,000 for an engineer, and $50,000 for a career in science.
On the other hand, the band that business students now share their educational bills with includes law (starting salary $49,000) andÂ medicine ($51,000).
So a Socialist interpretation of the Government’s motives here doesn’t make sense–which is just as well, I suppose: coping with the ironies of Higher Education funding in this country is difficult enough, without having to believe that Peter Costello is actually Che Guevara in disguise.
What makes more sense is that this is a smokescreen: it’s a way to seem to be increasing University funding, without really increasing at all. You’re merely stealing from Peter (in business) to pay Paul (in Mathematics). I expect that Education was told there wasn’tÂ much moreÂ money for recurrent funding, so shuffle the cards to increase funding for some disciplines, and get the money you need for that from some of the others.
Once again, it’s the business students that have been shafted. This is ironic, coming from an allegedly pro-business government. But it suits the mindset: keep overall government funding constant, make the students pay, and hit the business students first because they’re only there for the money anyway.
The dilemma for us educators is that this funding level–even when supplemented by increased funding from the students themselves–simply isn’t sufficient to prepare students for the environment they’re going to confront when they enter the workforce. Our graduates often get a first job in a trading department of a finance company–and come face to face with a Bloomberg screen for the first time in their lives, because most Universities can’t afford to set up mock trading rooms.
So business-persons, please ask this “business-friendly” government to get real on funding business education. There’s no way thatÂ University educatorsÂ can provide the education you want your graduates to have on this pittance.