AS THE debate on university fees reopens, Progressive Democrats leader Senator Ciarán Cannon has suggested the Government examine the merits of an Australian fees system which was introduced in 1989.
Under the system, all students who enter third-level institutions are charged higher education fees, with several measures in place to relieve the costs incurred in their studies.
Most Australian students are Commonwealth supported, which means they are required to pay about 25 per cent of the cost of tuition, called the student contribution, with the government covering the balance.
The majority of students defer payment of the contribution by applying for support under the Commonwealth's Higher Education Loan Programme. But there is the incentive of a 20 per cent reduction for those who can pay the contribution up front.
Under the programme, which is administered by the Department of Education, Science and Training and the Australian Taxation Office, the contribution is paid directly to the course provider by the government on behalf of the student. Upon completing their course the student is given some leeway which allows them to get established and repaying the debt is not compulsory until their income rises above a government set minimum repayment threshold.
The loan does not generate interest, instead all loans are indexed each year to reflect changes in the Consumer Price Index (CPI), which is generally between 2 and 4 per cent.
Mr Cannon said the system is by no means perfect, but is something the Government should examine. He said the requirement to pay no fees upfront removes a major disincentive in entering third level. "It is an inherently fair system with the well qualified and presumably financially secure graduates supporting the cash strapped students of the present," he said.
Mr Cannon said despite the obvious benefits of the scheme, it is quite convoluted and could result in complacency from both government and universities in their handling of funds. "As contributions flowed into college coffers, government funding diminished and a funding shortfall is still an issue for Australian universities," he said. - STEVEN CARROLL