Higher education reform clarifier #6: How realistic is the Greens’ university cost website?

The Greens’ What will my degree cost? website is aimed at politics rather than real education choices, but the idea of an education finance website is a good one. As I argued in The Conversation this morning, we also need to start helping people choose between vocational and higher education. But of course the information in a political website needs to treated with scepticism – even if I am the source of some of it.

For their website the Greens are using data I provided to various newspapers a few weeks ago, but without the caveats I attached to it. To reality check some of the wilder speculation at the time about $100,000 degrees, I used international student fees.

While international student fees are market rates, I believe that they are the upper limit of what is plausible for domestic students. This is because where we have deregulated markets for both international and Australian students, in postgraduate courses and in higher education providers outside the public system, in the vast majority of cases domestic students are charged less.

Some of the possible reasons for charging domestic students less are genuine cost differences, university missions aimed at serving domestic students, and a more competitive domestic market. But whatever the precise reason, the fee numbers in the Greens’ website are almost certainly higher than the average student will be paying in the future, and definitely much higher than the best-priced courses that will be available.

The campaigns being run by the Greens, the NTEU and NUS are likely to leave many people believing that higher education will be much more expensive than it really is. This is a problem for universities under the demand driven system. Under the previous system the supply of university places was set by government well below demand, so reduced applications had no effect on final enrolments. Now with supply and demand quite evenly balanced fewer applications could easily translate into fewer students for some universities.

A number of universities have recognised the problem, and announced price freezes for students starting during the rest of 2014. I think universities are going to have to a lot work on this for the 2015 intake to correct inaccurate beliefs about costs that some of their prospective students will now have .