Free lunch? If only…

If stu­dents aren’t charged fees, who gets stuck with the bill, and can they keep pay­ing enough to keep the qual­ity of the of­fer­ing from suf­fer­ing?

THE (Times Higher Education) - - LEADER - John.gill@timeshigh­ere­d­u­ca­tion.com

It won’t come as much sur­prise that Mil­ton Fried­man, free-mar­ke­teer ex­traor­di­naire, wasn’t a be­liever in the free lunch.

Giv­ing a lec­ture in the mid-1970s, he ripped into the idea that tax rev­enue could be raised from busi­ness – viewed as some sort of cor­po­rate cor­nu­copia – with­out any im­pact on in­di­vid­u­als. “Only peo­ple can pay taxes,” he said. It might be the share­holder, the cus­tomer or the worker, but “there’s no Santa Claus, no tooth fairy…some­body has to pay”.

So it is for higher ed­u­ca­tion: the ques­tion isn’t whether we should have free ed­u­ca­tion, it is who should pay for it, and how?

Per­haps more sur­pris­ing is that Fried­man’s an­swer to this ques­tion was based firmly on the be­lief that a univer­sity ed­u­ca­tion is not just a pri­vate good.

In fact, he is cred­ited by some as be­ing the fa­ther of in­come-con­tin­gent loans, of­ten viewed as the best way to ac­knowl­edge the pub­lic and pri­vate ben­e­fits of study, to share the cost bur­den and to main­tain qual­ity.

A year or two ago, this view of in­come­con­tin­gent loans seemed in­creas­ingly unas­sail­able.

Yet with a ma­jor fund­ing re­view now un­der way in Eng­land, pre­cip­i­tated by the pop­u­lar­ity of Labour’s op­po­si­tion pledge to scrap tu­ition fees al­to­gether, the deal now seems de­cid­edly less done.

Who, then, should pay for higher ed­u­ca­tion, how, and when? And how re­al­is­tic and sus­tain­able is fee-free ed­u­ca­tion, build­ing on the premise that tax re­ceipts will out­weigh the pub­lic out­lay – and that even if they don’t it is a sen­si­ble in­vest­ment for so­ci­ety to make?

In our cover story, we ex­plore these ques­tions through an An­tipodean lens, fo­cus­ing on New Zealand’s fee-free ex­per­i­ment to as­sess what it means for univer­si­ties, stu­dents and em­ploy­ers.

To re­cap briefly, Jacinda Ardern, the coun­try’s mould-break­ing prime min­is­ter, has pledged to abol­ish tu­ition fees al­to­gether. From this year, stu­dents who have com­pleted less than six months of ter­tiary ed­u­ca­tion will pay noth­ing for the first year, and by 2024 this will ap­ply to a full three years.

For Ardern’s govern­ment, this is an es­sen­tial in­vest­ment in the coun­try’s fu­ture.

As the ed­u­ca­tion min­is­ter Chris Hip­kins tells us, the ar­rival of the fourth in­dus­trial revo­lu­tion means “we’ve reached the point where… se­condary school ed­u­ca­tion is no longer enough”.

An­dreas Sch­le­icher, di­rec­tor of ed­u­ca­tion and skills at the Or­gan­i­sa­tion for Eco­nomic Co­op­er­a­tion and Devel­op­ment, iden­ti­fies four broad mod­els for fund­ing higher ed­u­ca­tion: Scan­di­navia’s low fee/high pub­lic in­vest­ment; con­ti­nen­tal Europe’s low fee/low pub­lic in­vest­ment; Eng­land and Aus­tralia’s state-sub­sidised loan sys­tem; and the high fees funded through com­mer­cial loans that fi­nance parts of the US sys­tem, South Korea and Ja­pan.

Clearly the out­puts and im­pli­ca­tions of these ap­proaches vary: con­ti­nen­tal Europe strug­gles in the qual­ity stakes; Eng­land is fac­ing the afore­men­tioned po­lit­i­cal crisis of con­fi­dence; Scan­di­navia’s sys­tem po­si­tions higher ed­u­ca­tion more firmly as a pub­lic, rather than a pri­vate, good; while the US has a markedly di­vided sys­tem, with cash-strapped publics squeak­ing at the pips and debt-laden stu­dents in the for-profit sec­tor left bur­dened – rather than set up – for life.

It hardly needs say­ing that there are no easy an­swers to the fund­ing ques­tion. The New Zealand ex­per­i­ment is bold – but univer­si­ties them­selves will view it with some trep­i­da­tion.

Fried­man noted that “even the most ar­dent en­vi­ron­men­tal­ist doesn’t re­ally want to stop pol­lu­tion. If he thinks about it… he wants to have the right amount of pol­lu­tion.

“We can’t re­ally af­ford to elim­i­nate it

– not with­out aban­don­ing all the ben­e­fits of tech­nol­ogy that we not only en­joy but on which we de­pend.”

It may be a slightly un­for­tu­nate metaphor, but even the most ar­dent ad­vo­cate of low-cost ed­u­ca­tion does not want to see the qual­ity of pro­vi­sion run into the ground by un­der­in­vest­ment.

There will al­ways be ar­gu­ments about the right fund­ing level. But it is not only New Zealand’s univer­si­ties that will be des­per­ately hop­ing Ardern’s govern­ment finds a set­tle­ment that main­tains their un­doubted ex­cel­lence. The coun­try’s stu­dents and so­ci­ety more broadly de­pend on it, too.

The New Zealand ex­per­i­ment is bold – but univer­si­ties them­selves will view it with some trep­i­da­tion

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