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FactCheck: will axing compulsory uni fees take $300 million away from services students need?

Scrapping student support fees will be “a $300 million hit on some of the most basic systems and amenities that make universities accessible and attractive to students.” - Kim Carr, former Labor higher…

Students services could be cut if the new education minister has his way. But what would this mean in practice? University students image from www.shutterstock.com

Scrapping student support fees will be “a $300 million hit on some of the most basic systems and amenities that make universities accessible and attractive to students.” - Kim Carr, former Labor higher education minister, press release, 25 September, 2013.

New education minister Christopher Pyne signalled last week that he would scrap compulsory student support fees as part of a range of proposed changes to higher education.

Pyne told the Australian Financial Review that the Liberal Party is:

…100% in favour of voluntary student unionism and we will move to abolish the student services amenities fee when it’s appropriate to do so.

Prime minister Tony Abbott has since backed away from these comments, saying that there are no immediate plans to scrap the fee.

Nonetheless, is former Labor minister Kim Carr right in saying the fee covers A$300 million worth of basic services in universities? And what does the fee cover exactly?

Universities may choose to make the student services and amenities fee a compulsory payment of up to A$273 for each full-time domestic student and a lesser amount for part-time students. This will rise to A$281 for full-time students by next year. (International students often have the fee included in the cost of their course and not as a separate charge).

The Liberal Party has sought to make the fee voluntary since the 1970s because it believes it has funded left-wing student organisations and their causes. It finally succeeded in 2005 after the Howard government secured passage of its “voluntary student unionism” legislation. This legislation made the fee no longer compulsory and individual students could choose to pay for services.

The Gillard government then secured passage of its own legislation in October 2011 allowing universities to reintroduce the compulsory fee.

The Higher Education Support Act (2003) specifically prohibits universities spending the fee to support a political party or election campaign. There are separate requirements for representing and advocating for the interests of students.

The act specifies 19 purposes which the fee may fund: providing food and drink, supporting sport and other recreations, clubs, child care, legal services, health and welfare, accommodation, employment services, financial services, insurance, debating, reading rooms, creative arts, media, study skills, advice and advocacy about internal rules, orientation, and meeting the special needs of international students.

These are the facilities and services which most students expect at a “full service” university campus.

Some student services such as the cafeteria and lounge are used by most students, but others such as counselling and welfare services are, by their nature, used by only a minority. Many students accept paying the fee as part of their membership of the campus community, but some are concerned about paying the fee because they don’t attend campus much or otherwise don’t use its facilities.

As for the revenue the fee brings in for universities, in 2008, consultations between universities and the government put the total revenue raised by the fee as at around $170 million.

But for a more current figure, we can make only a broad estimate using the data available.

So in 2012, public universities enrolled 627,425 domestic equivalent full-time higher education students. Approximately 345,000 of these students were part-time.

It’s important to note that part-time students can be charged more than their share. For example, a part-time student with 50% of the student course load could pay up to 75% of the fee, or $204 for this year and $210 by next year.

So calculating the revenue from this equivalent full time figure that combines part-time course loads, we get a figure of around $171 million based on the current fee, rising to $176 million on next year’s fee. But this figure is likely to be an underestimate because it undervalues the contribution of part-time students. Further, enrolments are likely to have increased in 2013 and to increase again by another few percent in 2014.

Another way to calculate would be to look at the number of full-time domestic bachelor students and part-time domestic bachelor students in 2012. Based on this calculation, we would see over $175 million in fee revenue on the 2014 rates. Add domestic post-graduates into the mix and your looking at more like $185 million. But this too would be an underestimate as it doesn’t include all domestic commonwealth supported students. As a ball park figure and as student numbers are likely to increase, $200 million in revenue is not inconceivable.

When The Conversation contacted Senator Carr’s office, they were unable to provide a specific source for the $300 million figure. Instead they referred us to a Financial Review article which claimed that “the total collected [from compulsory fees] in 2013 was likely to be closer to $300 million”, however this was only attributed to “sources”.

Verdict

It is true that scrapping the compulsory fee would reduce student services and amenities on Australian university campuses. They are, by and large, basic services that make universities accessible and attractive. But without official figures, the claim that these services amount to $300 million is hard to substantiate and could be an exaggeration.


Review

Senator Kim Carr’s central point that the removal of the student services and amenities fee will be detrimental to student services, such as counselling and childcare, is certainly supported by experience. When the fees were last abolished it had a serious effect on services, particularly at some regional campuses.

As the author rightly concludes, without official data it is hard to substantiate the claim that $300 million will be lost. Nonetheless, the impact will likely be significant for students at Australian universities if the compulsory fee is scrapped. – Gwilym Croucher

Ever seen a “fact” that doesn’t look quite right? The Conversation’s FactCheck unit asks academic experts to test claims and see how true they really are. We then ask a second academic to review an anonymous copy of the article.

You can request a check at checkit@theconversation.edu.au. Please include the statement you would like us to check, the date it was made, and a link if possible.

Join the conversation

24 Comments sorted by

  1. Gerard Dean

    Managing Director

    No doubt the possible axing of the Student Services Fee or what was often called the Union Fee will affect services to students.

    One union service I fondly remember from my brief stint at Ballarat Institute for Advanced Education back in the 70's, was enjoying an ice cold beer served out in the open in freezing winter rain. The institute forbid serving of alcohol on campus, so the union negotiated a deal with the local farmer to serve beer in his paddock.

    However, the main reason that people my age are so distrustful of the old Union Fee was the propensity for them to allocate part of their budget to the Trotskyist Students Collective or similar. These groups appeared to have no classes often mocking engineering students with 35 contact hours a week.

    I will never forget their pompous sneering at those who just wanted to work hard and learn.

    Gerard Dean

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    1. John Crest

      logged in via email @live.com.au

      In reply to Gerard Dean

      You're quite right Gerard.

      The money seemed to be disproportionately allocated to fringe groups you simply wouldn't find elsewhere.

      None of these provided a useful service to the majority, that's for sure.

      And the "basic services" that were provided that a normal person would be interested in (medical, dental, gym, etc) were better provided at a lower cost elsewhere anyway.

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    2. Rex Gibbs

      Engineer/Director

      In reply to Gavin Moodie

      As one who was deprived of eating/transport money by my compulsory union fee in the mid 70's and who was very bitter about funding of the Trotskyist collective and the Labour club and the Liberal club and the Socialist student workers alliance all buying votes with beer paid for with my money my gut feel is to support Pyne. I now have a daughter at University who has 25 contact hours and who does use the rowing club facilities whech get a small subsidy from the amenities fee (no she is not a private school spooner). She got very angry about the Footy club drinking their amenities fee contribution well supported by a recently failed labor candidate who drank more than his share. They did do it at the boatclub so there was a transfer of wealth and she did earn enough to pay 1/3 of her amenities fee. Her view and mine is - pay for what you use. As soon as there is an amorphous pool of money someone with spare time on their hands will find a way to get some.

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    3. Russell Smith

      Manager

      In reply to Gavin Moodie

      Have to agree Gavin

      Whenever this debate comes up it seems to be driven by politicians 'settling' 30+ year old arguments from their days in student politics and commented on by people (including myself) whose student experience is from a similar era.

      As we saw when the previous liberal government banned the fee, services - particularly in regional or smaller universities - don't move to user pays they simply stop. Larger or better resourced universities are forced to divert millions of dollars of much needed teaching revenue to maintain basic services.

      What's the game changer here? Could the government not link any changes to these services fees to some level of fee deregulation?

      For overseas and postgraduate fee students these fees are often embedded within the overall course fee. Enabling the same approach for HECS students would at least remove some of the ambiguity and provide flexibility on how services are delivered.

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    4. Gavin Moodie
      Gavin Moodie is a Friend of The Conversation.

      Adjunct professor at RMIT University

      In reply to Rex Gibbs

      I would have to know the details to comment fully. Perhaps a university allocates some of the student services and amenities fee to clubs, presumably according to their number of members. Perhaps the rowing club spends their income on maintaining their boats while the footy club spends it on booze. I suppose the university could regulate what clubs spend their fee income on, but this would be rather detailed intervention into the affairs of student clubs.

      Some institutions may have students paying for just what they use - Open Universities Australia runs partly along these lines. But I don't think the principle would be adopted by any Australian university, for it would mean charging students different amounts according to their use of libraries, study skills support, wireless on campus, etc.

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    5. Gavin Moodie
      Gavin Moodie is a Friend of The Conversation.

      Adjunct professor at RMIT University

      In reply to Russell Smith

      I agree Russell. The Liberals (and Labor) should adopt this from the Nationals' 2013 policy platform:

      ‘University councils should have the power to include, in setting their fees, an amount to cover a limited range of student services, particularly the sporting and recreational facilities that enhance the university experience.’ (page 21)

      http://www.nationals.org.au/Portals/0/2013/policy/Policy_Platform_August2013.pdf

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  2. Kate Dempsey

    Executive Officer

    Gavin: another fact check. For better or worse, Tony Abbott is the Prime Minister now, not the Opposition Leader.

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    1. Dianna Arthur

      Environmentalist

      In reply to Kate Dempsey

      Kate

      Does that mean Abbott and his cabinet are above critique?

      For the record, I thought union fees were an impost until I needed the services the fees provided. These fees cover counselling, dental care, medical care, rent assistance, loan assistance and much, much more.

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    2. Kate Dempsey

      Executive Officer

      In reply to Dianna Arthur

      Certainly the government of the day should never be above critique Diana, I was just having a "dig" at Gavin's fact check which had a factual error in it. :)

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  3. Thomas Fields

    "progressive" watcher

    It was an excellent move by Howard to remove compulsory union fees. I was hundreds of dollars better off. It is hard enough to make your way financially through university without having to fork over a few extra hundreds of dollars. There was no change in activities or prices on campus when the fee was removed. There was, however, more money for myself to eat well and spent on other necessities.

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  4. Graham Hastings

    NUS Research Coordinator

    The figure of $170 million was also used by the ALP government when the SSAF legislation was introduced in 2010.

    For those who are interested in this debate and what has really been happening in under SSAF in 2013 rather than re-hashing the old debates under very different arrangements prior to 2005 the National Union of Students will be releasing an extensive report on SSAF implementation later this month. It will include an audit of (the now diminished) student control of student services at all universities and findings from an extensive survey of 31 campus student organisation presidents. The survey will cover matters such as transparency (or lack of) university SSAF consultations with the student body, how the fee is allocated (in 2013 the university kept the majority of the SSAF revenue at 26 out of 30 unis), and any support for student representation (as it can't be funded from the SSAF). It will be on the NUS website.

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  5. Chris O'Neill

    Retired Way Before 70

    "providing food and drink, supporting sport and other recreations, clubs, child care, legal services, health and welfare, accommodation, employment services, financial services, insurance, debating, reading rooms, creative arts, media, study skills, advice and advocacy about internal rules, orientation, and meeting the special needs of international students."

    A lot of these services are provided or subsidised by governments (child care, legal services, health and welfare, employment services, etc) and other organisations to the community in general so using fees from students means that some money that the government would have provided for those services is lost to students. This is just plain unfair. Why should Universities have their own little welfare empires paid for using a poll tax on some of the poorest members of society? In other contexts this sort of unfair regressive treatment would cause riots but in a University you can get away with it.

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    1. Chris O'Neill

      Retired Way Before 70

      In reply to Gavin Moodie

      If students can access community legal centres then what is the point of them paying extra (fees) for something they can already get?

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    2. Gavin Moodie
      Gavin Moodie is a Friend of The Conversation.

      Adjunct professor at RMIT University

      In reply to Chris O'Neill

      These decisions are taken by students and I expect they differ on each campus. However, generally community legal centres are crowded, are distant from campus and deal mostly with family law, consumer debt and minor crime. Student legal services are usually on campus and specialise in issues particularly relevant to students such as academic progress and student discipline.

      Again, arrangements differ on each campus but some of the student legal services I've seen are an arrangement with a private practitioner or firm to come on campus a couple of half days a week, provide the first consultation free, and provide subsequent legal services at a discounted rate or perhaps free in consultation with the student body. They may cost c $15,000 annually, or c 50c per equivalent full time student per year.

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    3. Chris O'Neill

      Retired Way Before 70

      In reply to Gavin Moodie

      I've never heard of academic progress as an issue requiring legal advice for students but I'd agree there are a few students who get themselves into trouble with the University and would like to have their expenses paid for by other students. It would be nice if other students could be consulted (not to mention given a choice) about what they're paying for that is going to someone else.

      "50c per equivalent full time student per year"

      OK, we just need some discussion about the other $272.50 per year.

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    4. Gavin Moodie
      Gavin Moodie is a Friend of The Conversation.

      Adjunct professor at RMIT University

      In reply to Chris O'Neill

      Yes, students challenge exclusion for unsatisfactory academic progress in internal university tribunals and many are represented by people who generally do a good job. Very rarely are these cases appealed to the civil courts, altho a case went to the High Court in 2005. I think Legal Aid funded that case.

      The legislation provides for each university to consult its students on the allocation of the student services and amenities fee. As the forthcoming National Union of Students' report will…

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    5. Chris O'Neill

      Retired Way Before 70

      In reply to Gavin Moodie

      Well I guess some people will use lawyers to challenge things they don't like that very few people would bother with but as long as it's rare then it isn't much of an issue. But it still doesn't alter the point of choice. How many students really want this insurance?

      "Student control over student services and amenities fees does end disputes over the allocation of the fee; indeed, in some cases it exacerbates disputes."

      I presume you meant "doesn't end disputes".

      "It is bemusing for so much attention to be directed to a fee which is 4% of students' Hecs fee over which students have very little say"

      This is a "relatively small wrong makes a right" argument.

      It doesn't matter if a wrong is relatively small compared with something with which it has a loose relationship, it is still a wrong.

      By the way, things may have changed since, but in my day faculty library costs received nothing whatsoever from student union fees.

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  6. Andrew Smith

    Education Consultant at Australian & International Education Centre

    I don't recall anything too ideological about student union (RMIT early 80s), asssumed any political club could be eligible for financial support, and at that age many would 'experiment' with the left (or at least wear a save the whale badge or something).

    Another perspective is when counselling prospective international candidates for university from less developed countries with democracy issues, lack of personal freedom and a very top down society.

    In Australia, as a first world democracy, one could explain that student services run the campus outside of faculty and admin, giving younger generations an opportunity to take responsibility and develop their contribution or service to society (anyone can choose to do that, but many won't unless given opportunity).

    That is the difference between first world and others, but many in Australia nowadays would prefer a more authoritarian just follow orders approach to society, that fits better in less developed democracies....

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  7. Judith Olney

    Ms

    A lot of students study externally these days, (online and some not even in the same state as the campus), and have no access to the campus at all, let alone access to student services. They should not have to fund the internal students services, sports, clubs or food and drinks.

    User pays is a fairer system, if on campus students want a tavern, sporting facilities, etc etc, let them fork out for it.

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