Budget cuts, deregulation put NT’s university at risk

The Northern Territory’s sole university would be hit especially hard by Christopher Pyne’s plan to deregulate fees, cut the higher education budget and impose crippling debts on students, Shadow Minister for Higher Education Kim Carr warned today.

Senator Carr, who is visiting Charles Darwin University (CDU) with Northern Territory Senator Nova Peris, said that the CDU’s submission to the Senate’s inquiry into the Pyne plan painted a stark picture of the consequences of deregulation.

In the submission, CDU Vice-Chancellor Professor Simon Maddox wrote:

“CDU anticipates that the impact of changes to student fees and student loan repayments as proposed in the Reform Package could result in an overall drop in enrolments.
“This would have serious financial implications for CDU’s sustainability and viability as a regional and remote tertiary education provider in the longer term, as well as implications for the Northern Territory as a whole.
“Not only is CDU a significant employer, it also contributes significantly to the economic, social and cultural wellbeing of the NT
… a drop in enrolments at CDU will therefore have a much greater impact on this jurisdiction than will changes in the other Australian states.”

The Abbott Government’s changes to higher education are a triple-hit to students and universities:

  • Cutting funding for undergraduate places by up to 37 per cent;
  • Deregulating fee levels, allowing universities to charge what they like; and
  • Introducing a compounding real interest rate of up to 6 per cent for all HECS-HELP debts – future and existing.

Overall, the Abbott Government’s Budget cut $5.8 billion from higher education. Universities have confirmed in recent Senate hearings that this means they will be forced to put up fees by at least 30 per cent just to cover the loss of funding.

“The cuts and the prospect of higher fees and mounting debt would end the fair go that Australians rightly expect,” Senator Carr said.

“Under the Pyne plan a university education would become a privilege of the rich, not a door to opportunity for anyone who has the ability.”

In CDU’s case, the hit to the bottom line is estimated to be more that $50 million over four years for the undergraduate funding cuts alone, plus almost $2 million in cuts to research training support and an additional impact from reduced indexation.

CDU has a high proportion of indigenous students (6.4 per cent), a high proportion of students from low-income families (19 per cent) and an very high proportion of students who were not recent school leavers (75 per cent are older than 25).

“This is a unique combination of debt-averse groups who could be deterred from further study by the prospect of higher fees and higher interest rates on their loans,” Senator Peris said.

“Mature-age students, in particular, have to consider the impact of education costs as part of a wider financial decision – usually, as part of a family budget.”

Senator Peris said she was also concerned at the impact on CDU of changes to the Indigenous Tuition Assistance Scheme (ITAS), which provides universities with funds to support indigenous students.

Until now, universities could apply for ITAS grants based on the previous year’s enrolments, but the Abbott Government has decided that universities will now have to compete with other providers for access to the funds.

“This lack of certainty is a further blow to CDU at a time of when the Abbott Government is proposing radical higher education changes that are estimated to cost the university more than $52 million,” Senator Peris said.

“The Giles Government’s silence about the Pyne plan and the ITAS changes demonstrates a shocking lack of interest in the future of CDU as a vital institution for the Northern Territory.”


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