Higher Education Policy in Australia - Case Study Example

STUDENT DETAILS ACAP Student ID: Name: Course: ASSESSMENT DETAILS Unit/Module: Educator: Assessment Name: Assessment Number: Term & Year: Word Count: DECLARATION I declare that this assessment is my own work, based on my own personal research/study . I also declare that this assessment, nor parts of it, has not been previously submitted for any other unit/module or course, and that I have not copied in part or whole or otherwise plagiarised the work of another student and/or persons. I have read the ACAP Student Plagiarism and Academic Misconduct Policy and understand its implications. I also declare, if this is a practical skills assessment, that a Client/Interviewee Consent Form has been read and signed by both parties, and where applicable parental consent has been obtained. Higher education policy in Australia Education is one of the core and important policies of any government, Australia included. Education in Australia remains a vital indicator of financial security and well-being. As of the year 2003, approximate half of the Australian population possessed a form of post secondary education. Individuals lacking any form of post secondary education were three times more likely to be victims of unemployment compared with those possessing degrees (Kennett, 2001). Dropping out of the education early remains one of the avenues of unemployment and social segregation. For many centuries, education was the privilege of the wealthy ruling class in society. In Britain, Americas and Europe, and at last Australia, young men were taught history, philosophy, religious studies, social sciences, rhetoric and classics. Women were later on accepted into the education system where they were instructed also on literature and music. The purpose of obtaining education during this period was in preparation for entry into public and marriage life. The notion of obtaining education for employment and career progression is relatively a new phenomenon. For the past 20 years, education policy has been to create and develop an efficient workforce that is able to compete in the ever increasing competitive global market place. Another factor that makes education policy an important area of social policy is due to the fact that education takes a considerable length in ones lifetime. On average, most individuals spend 16 years in institutions of learning while other may choose to proceed for further studies (Kennett, 2001). One of the areas of Australia’s education policy revolves around the higher education sector. From 1970’s onwards, higher education has witnessed significant changes. The Labor government which came into power in 1972 fully funded the higher education sector by removing university fees for all students, and this remained until 1989. During this period also, the binary system that comprised universities and Colleges of Advanced Education (CAEs) were combined to form a single system of 36 universities (Stokes & Wright, 2012). The Hawke Labor government in 1989 was forced to introduce the Higher Education Contribution Scheme (HECS), a system where university students contributed part of their fees. This is a system where students had the option of paying their fees during studies or postponing payment until they are employed, and then they can remit back the money to the government through the tax system. From 1996 onwards, the govern began restructuring the HECS by removing the system of flat rate contribution and replacing it with one where contribution was made in bands, which are determined by the course being pursued, and from then on the contributions have increased steadily. The last change was undertaken in 2005, in which universities were allowed to raise their fees by 25 percent (Dodgson, 1996). This last change received strong opposition from nation teaching unions and university student groups. Currently, university students are responsible for between 25 and 40 percent of their fees (Stokes & Wright, 2012). Most of the changes that took place in the higher education sector from the 1980s were driven by political agenda rather than considerations for the purpose of education in society and the most effective techniques of supporting and delivering it. Some of the key issues that have come up in the recent past are: the impact of public education spending on future economic health, the lacking behind by the government in education support, role of research in Australian universities and the requirement of government support, diminishing support by Australian businesses which hampers research and innovation, false projection on the impact of information technology on the education sector, role of the internet in education ( is it a tool or solution), and the continuous attack on university tenure. Higher education funding has become a contentious political issue. Decreases in government support of higher education have mainly been praised as efficient. What politicians supporting these policies of reducing funding to the higher education sector fail to see is that as inflation continues to rise, personal funding of higher education will decrease and this will ultimately affect the quality of higher education and make it unaffordable to many Australians. Opposition to these efficient gains is due to the belief that higher education has a higher purpose that society has the responsibility of supporting irrespective of the returns. This is because despite education being an avenue of private gain materially, society has got no responsibility of supporting such adventures irrespective of their magnitude. Private benefits are inconsequential to the society, but public benefits are pervasive, large and documented. All civilizations began with the invention of formal education. From Egypt, Peru, Mesopotamia to China, civilization was realized with the invention of agriculture, which necessitated the acquisition of skills required to manage it. Administrators, priests and scribes had to learn laws, statistics, nature and beliefs in order for the society to progress industrially and economically. This shows that throughout human civilization, education has been the foundation and driver of civilization and industrial development. Those opposed to government support to education and particularly higher education fail to see the monumental impacts of education on society. They are simply opposing industrial development, wealth creation, societal well-being, which can be summed up as human civilization (OECD, 1995b). The impact of education spending and economic well-being is well documented and undeniable. Recent studies support investing in higher education due to its impact on economic development compared to other forms of public investment. Statistics from the Organization of Economic Cooperation and Development show that education spending has a deep impact on per capita gross domestic product (GNP). Education expenditure in 1977 and per capita GNP was r12 = 0.8212 and in 1992 r13 = 0.5816 (Australian Bureau of Statistics, 2010). This shows a decrease over a period of fifteen years, which in turn reveals two facts: expenditure on education relies on the existing wealth in society (r12) and present wealth creates future wealth, which cause a declining correlation between education expenditure and wealth creation in the future (OECD, 2006). From this information, it is evident that current wealth leads to present education expenditure and future wealth, and on the other hand more education expenditure creates future wealth. Allowing the correlation between education expenditure and economic well-being, the question that remains contentious is the level of education support by the government. It is a fact that an optimal level of support for the education sector must be supported. In reference to Arthur Laffer’s tax curve: at zero support, there is absence of gain, and if education was to take all resources in society, there will be no gain due to absence of industry (Ellis, 1996). In determining the optimal expenditure on education, two considerations are paramount. First is the positive correlation, which is impossible to determine if most OECD countries studied used more than the optimal amount on education; therefore education expenditure did not exceed the optimal amount and secondly, when Australia’s education expenditure was 0.19 standard deviations more than the OECD average in 1977 to 0.7 standard deviations below that of the OECD average in 1992, the federal and state governments had been cutting expenditure on this sector (Stokes & Wright, 2012). Some radical steps have been undertaken to reduce the economies of the United Kingdom and America, but Australia’s decreasing support to the education sector deviates from scientific evidence that outlines the significance of education spending and that of other industrialized economies. If this trend is not addressed promptly, Australia’s minimal expenditure will be the foundation of average and meager economic performance both in the short-term and long-term. Another higher education policy issue concerns the business of academics from an industrial perspective. In a contemporary model, the university is the supplier of skilled work force, while the industry is the consumer. University learning imparts fundamentals to students, while the industry gives the practical experience (OECD, 1995b). This combination is necessary for a graduate to develop career wise and solve issues and problems that are challenging. This model is common in all western industrial economies, and is responsible for the industrial expansion witnessed in the 20th century. The Hawke administration and more specifically the treasury under Keating saw Australia witness policy changes that contributed to destruction of the long-term potential of its economy. Some of the policy changes were poorly drafted tariff reductions, high tax and interest rates. Coupled with failure of the government to reform its procurement rules that favored overseas manufacturers, and an investment culture that feared cutting edge technology, an unfavorable climate for manufacturers of high technology goods like computers and software was created (Dodgson, 1996). During this period, Australia experienced the collapse of many high technology industries such as L&L Computer, Solbourne, Acet and Labtam. Other companies faced rigorous derailment of innovation and product development. Following the implementation of Keating’s Fringe Benefit Tax, local automotive industries shrunk, which in turn created a hostile economic environment for the computer industries. Due to the shrinking demand of domestically build automobiles, a sizeable number of small component devices industries were forced to close business (Hamel & Pralahad, 1991). This in turn affected the computer industry which relied on these industries for mechanical and electrical parts. The end result was that the computer industries were forced to import such parts hence domestic competition in the local computer industry was diminished. This is one of the many examples where a poorly considered public policy can have severe implications on industries that the proponents of the policy did not expect or were ill prepared to comprehend. This problem was further worsened by alterations to the tertiary education system, which saw the combination of existing institutions with the university system and a change funding policy that favored quantity over quality. These changes are responsible for worsening the economic environment of technology based industries. CAE and Technical And Further Education (TAFE) institutions, which are responsible for training certificate and diploma level professionals with limited fundamental skills, but extensive vocational skills, were incorporated into the university system, which is characterized by extensive training on fundamentals and limited vocational skills (Dodgson, 1996). These changes are responsible for producing graduates with limited skills albeit in large numbers. These changes coupled with global recession exerted pressure on industry, which is the consumer of personnel from the education system. The industry was forced to restructure by cutting the salaries of professionals and reducing its work force. Planning changed from being long-term to short-term for the sake of surviving the harsh environment. Human resource policies moved to hiring professional who brought immediate results (Ellis, 1996). The idea of graduate training became unfavorable because of the wide pool of unemployed or retrenched professionals. These survival strategies of industries were unfavorable to graduates with no experience. Decrease in the quality of the work force churned by universities complicated career development in the job market due to the training demands by employers (OECD, 2006). The notion that graduates require longer periods of training or that they are poorly equipped to participate in training shows the failure of the education system to produce skilled labor force for the country’s high technology industries (Ellis, 1996). The risk of university training with a strong foundation of vocational skills and limited training in fundamental skills is that they become perishable in a rapidly changing and competitive market place. Technological changes, which are a characteristic of high technology industries, have conspired to render graduates with vocational skills only non-competitive (Hamel & Pralahad, 1991). The chances of a graduate with weak fundamental skills to progress and be promoted to management position are limited. The reason for this is that fundamental skills are not affected by technological changes and market forces. A good knowledge of fundamentals makes learning the technological part easy at the place of work. The staffing policies of universities have become another policy area with many unresolved issues. Currently, there is a push to bring industry based management policies to institutions of higher learning. In many instances, university staffs are offered short contracts after which they can be renewed or replaced. This makes them temporary employees, which goes against the objectives of higher education, which are to produce, maintain and disperse knowledge. University staffing policies should be geared towards developing and retaining knowledge instead of strategies aimed at reducing employment costs. Policies that tend to make comparisons between university management and industry management are deceptive. Industrial research and development entails conversion of fundamental skills into marketable goods, while primary research, which is the discovery of fundamental knowledge demand different skills. University research is based on the search for new fundamental knowledge, and in so doing they develop the requisite skills required for the job. Industry research is measured by the patents filed, gaining a competitive advantage and safeguarding that advantage. University research is tailored at seeking knowledge for societal good. Universities will only achieve its objectives in the economy if policies are developed which are founded on management practices aimed at discovering, maintaining and distributing new knowledge. Policies which attempt to limit the corporate pool of knowledge subordinates this function. Tenure is one way of achieving this primary function. An example is a chair of a specific field in charge of researchers, is a pool of knowledge which can be utilized by students in different levels who then transfer it to industry. Another policy by the government of Australia is the support of private learning institutions. The Howard administration introduced the Enrolment Benchmark Adjustment (EBA). This is a policy which reduces funding to higher education as the number of students in private institutions increases. $ 1,700 is deducted for each student who joins a private institution above the EBA levels. As of 1999, half of all university enrolments were in private institutions and accounted for 33 percent of all university students (Australian Bureau of Statistics, 2010). Reference Australian Bureau of Statistics. (2010). Labour force Australia. Retrieved from http://www.abs.gov.au Dodgson, M (1996) .The importance of management for science.' Radio transcript of "Ockham's Razor". Moderated by Robyn Williams for ABC Radio. Ellis, J (1996). Quoted in `Stick to theory: BHP boss,' by Guy Healy. The Australian Hamel, G & Pralahad, C (1991). 'Corporate imagination and expeditionary marketing'. Harvard Business Review, July-August, 1991. Kennett, P. (2001). Comparative social policy: Theory and research. Oxford: Oxford University Press. OECD (1995b). OECD educational statistics 1985-1992. OECD. OECD (2006).Education Policy Analysis 2006: Focus on Higher Education. London: OECD Publishing Stokes, A. & Wright, S. (2012). Higher Education Policy In Australia Since World War II. 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From 1996 onwards, the govern began restructuring the HECS by removing the system of flat rate contribution and replacing it with one where contribution was made in bands, which are determined by the course being pursued, and from then on the contributions have increased steadily. The last change was undertaken in 2005, in which universities were allowed to raise their fees by 25 percent (Dodgson, 1996). This last change received strong opposition from nation teaching unions and university student groups.

Currently, university students are responsible for between 25 and 40 percent of their fees (Stokes & Wright, 2012). Most of the changes that took place in the higher education sector from the 1980s were driven by political agenda rather than considerations for the purpose of education in society and the most effective techniques of supporting and delivering it. Some of the key issues that have come up in the recent past are: the impact of public education spending on future economic health, the lacking behind by the government in education support, role of research in Australian universities and the requirement of government support, diminishing support by Australian businesses which hampers research and innovation, false projection on the impact of information technology on the education sector, role of the internet in education ( is it a tool or solution), and the continuous attack on university tenure.

Higher education funding has become a contentious political issue. Decreases in government support of higher education have mainly been praised as efficient. What politicians supporting these policies of reducing funding to the higher education sector fail to see is that as inflation continues to rise, personal funding of higher education will decrease and this will ultimately affect the quality of higher education and make it unaffordable to many Australians. Opposition to these efficient gains is due to the belief that higher education has a higher purpose that society has the responsibility of supporting irrespective of the returns.

This is because despite education being an avenue of private gain materially, society has got no responsibility of supporting such adventures irrespective of their magnitude. Private benefits are inconsequential to the society, but public benefits are pervasive, large and documented. All civilizations began with the invention of formal education. From Egypt, Peru, Mesopotamia to China, civilization was realized with the invention of agriculture, which necessitated the acquisition of skills required to manage it.

Administrators, priests and scribes had to learn laws, statistics, nature and beliefs in order for the society to progress industrially and economically. This shows that throughout human civilization, education has been the foundation and driver of civilization and industrial development. Those opposed to government support to education and particularly higher education fail to see the monumental impacts of education on society. They are simply opposing industrial development, wealth creation, societal well-being, which can be summed up as human civilization (OECD, 1995b).

The impact of education spending and economic well-being is well documented and undeniable. Recent studies support investing in higher education due to its impact on economic development compared to other forms of public investment. Statistics from the Organization of Economic Cooperation and Development show that education spending has a deep impact on per capita gross domestic product (GNP). Education expenditure in 1977 and per capita GNP was r12 = 0.8212 and in 1992 r13 = 0.5816 (Australian Bureau of Statistics, 2010).

This shows a decrease over a period of fifteen years, which in turn reveals two facts: expenditure on education relies on the existing wealth in society (r12) and present wealth creates future wealth, which cause a declining correlation between education expenditure and wealth creation in the future (OECD, 2006).

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