In saying that I expect price sensitivity to be low in response to changed student contributions, I have given the HELP loan scheme as one of my reasons. Study now, repay later, perhaps never.
But I should caveat that, because not all Commonwealth supported students are entitled to a HELP loan. HELP is a rare social support scheme that is linked to citizenship; it could be the only one (happy to hear of others, if anyone knows of them). The only general exception is permanent humanitarian visa holders.
Entitlement to a Commonwealth supported place is more conventional. Permanent residents can have one. Indeed, for people with PR their tuition subsidy entitlements are more liberal than for other programs. Unless someone was an international student when starting their course, their eligibility for a CSP begins immediately on attaining permanent residence, while there is a waiting period for many social security benefits.
The benefit for a CSP for someone with PR is limited to the Commonwealth contribution and the price cap on student contributions.
But this means that any student contributions have to be paid upfront. In 2018 about 38,000 domestic students were permanent residents, or 3.5 per cent of the total.
Unfortunately there is no data available on which course they take, but finding $14,500 upfront for arts, business or law courses could be very difficult.
There is a more complex situation for New Zealand citizens. They are also entitled to a Commonwealth supported place, but without a general right to HELP. However, long-term NZ citizen Australian residents who arrived as children can get HELP.
About 13,000 NZ citizens are enrolled in Australian higher education institutions, or 1.2 per cent of the domestic total, with no data on loan eligibility or courses taken.
As the New Zealand media is reporting, they could save some money by heading back across the Tasman.
The original reason for the distinction between CSP and loan eligibility is that people with PR or NZ citizenship by definition have residence rights in other countries, making them less likely to stay in Australia and repay their HELP debt.
But as I argued a few years ago, these distinctions are not as strong as they once were. Australia has had official dual citizenship since 2002, and as we found out during the parliamentary eligibility saga large numbers of Australians are dual citizens. The idea that citizenship legally restricts a student to long-term Australian residence is less true than it was in the past.
Since the 2016-17 tax year, someone with a HELP debt who resides overseas is supposed to repay, reducing the risk of that they will leave Australia with unpaid student loans (although in practice getting them to repay is hard if they don’t intend to return).
This issue with HELP exists irrespective of whether the Tehan package passes the Senate. For many prospective students, it will be easier for them to find the money they need to pay upfront. But in humanities, law and business it will harder than before. The long delays in processing citizenship applications could be very expensive for some would-be students.