Push to Give TAFE Students HECS Loans (1 Viewer)

[ur_inner_child]

Push to give TAFE students HECS loans

Jessica Irvine
April 19, 2007

STUDENTS in vocational courses should be able to use the Federal Government's HECS loan system to cope with increasing up-front fees, a paper authored by one of the architects of the scheme claims.

Launched yesterday by the Treasury secretary Ken Henry, the paper dispelled the myth that TAFE graduates, who typically earn lower incomes, would take too long to repay the debts.

In fact, a male student completing a two-year diploma course could be expected to start repaying his loan five years after graduation, repaying it within two years. Female students would take seven years because their average earnings were lower.

The study authors, including the ANU professor Bruce Chapman, who advised on the design of the HECS scheme in 1989, found that TAFE students would be just as capable of repaying as their university counterparts.

Failure to make loans available could be a "significant barrier" to low-income students, given the steep rise in up-front fees, particularly in courses using expensive materials or specialist teaching staff.

A diploma of multimedia could cost as much as $6060, aromatherapy $4000 and a certificate in commercial cookery $3167 for just six months.

After a recent decision to extend HECS loans to private universities, the report warns that continuing to exclude students in the TAFE system could jeopardise its future.

"This could mean that eventually TAFE would be crowded out by private-sector alternatives and cease to be viable as an educational institution."

Overlapping state and federal responsibilities for the TAFE system could delay reform, the report warned.

Dr Henry, who has been at the centre of controversy this month when an internal speech critical of the Government was leaked, emphasised the report did not necessarily reflect the views of Treasury.

However, "anybody with an interest in the public policy question of what higher education, particularly at the technical level, can contribute to lifting the skills base in Australia … really should read this paper", he said.

 

[S1M0]

Yeah, there's no problem with that.

I mean, if uni students get the same benefits then so should TAFE. Although $2000 may be small change compared to what uni fees are, some people who go to TAFE may not be able to afford it.

 

[xXeMoxXxCoRexX]

The optimal solution is to give TAFE students HECS loans but stop giving Arts degrees HECS loans, so hopefully it balances out in terms of funding, but it helps resolve the skills shortage.

 

[volition]

How about we just stop supporting all degrees? Stop taking people's money hey? Now there's a thought...

 

[volition]

Well you might be right in saying that uni becomes a domain for the rich (if universities weren't able to bring their costs down), but who's to say that university degrees are necessary for us to be able to perform certain roles anyway? We could just have more technical colleges and places that train people to work in certain professions. Or people could get sponsored to go to university by a firm, or go on scholarship. Point is, less people would go to uni at the expense of other people 'for fun', and now that they'd actually have to pay for their education they would only spend their money on things that they believe will help them get useful skills. (as opposed to just doing a degree for the fun of it and not really thinking ahead about what sort of job you're going to head into)

There is no way that the government is able to know exactly what quantity of x-type worker is needed, and how to use them, so why not just let people work it out amongst themselves? Talk of a 'shortage' that only the government and other people's money can fix is stupid.

This policy also has the added benefit of being able to keep more of your own money, rather than having it stolen away from you in "I know what's better for your money than you do style".

 

[bshoc]

How about we just stop supporting all degrees? Stop taking people's money hey? Now there's a thought...

HECS does not take away peoples money, in fact it trains and educates the people who will be funding the retirement of the current taxpaying generations ..

 

[bshoc]

Well you might be right in saying that uni becomes a domain for the rich (if universities weren't able to bring their costs down), but who's to say that university degrees are necessary for us to be able to perform certain roles anyway? We could just have more technical colleges and places that train people to work in certain professions. Or people could get sponsored to go to university by a firm, or go on scholarship. Point is, less people would go to uni at the expense of other people 'for fun', and now that they'd actually have to pay for their education they would only spend their money on things that they believe will help them get useful skills. (as opposed to just doing a degree for the fun of it and not really thinking ahead about what sort of job you're going to head into)

Because its less flexible than a uni education and opens up the way for a much greater de-skilling impact in the future ..

There is no way that the government is able to know exactly what quantity of x-type worker is needed, and how to use them, so why not just let people work it out amongst themselves? Talk of a 'shortage' that only the government and it's public money can fix is stupid.

People already figure it "amongst themselves" when they pick their courses through UAC and achieve their relevant UAI's. The HECS system itself is currently 4 tier as well.

 

[volition]

HECS does not take away peoples money, in fact it trains and educates the people who will be funding the retirement of the current taxpaying generations ..

Give em time, they'll stop giving pensions soon enough, it'll just be too costly.

I don't see why you think HECS doesn't take money either. Somebody somewhere, has to pay MORE tax as a result of it's existence. I am referring also to university payments that are made from the government. Unless our students pay back everything they used, which I doubt.

 

[bshoc]

Give em time, they'll stop giving pensions soon enough, it'll just be too costly.

I'm not talking about pensions and super, I'm talking about the people who will be contributing both to the economy and to the tax pool when these people will be in retirement.

I don't see why you think HECS doesn't take money either. Somebody somewhere, has to pay MORE tax as a result of it's existence. I am referring also to university payments that are made from the government. Unless our students pay back everything they used, which I doubt.

Higher education is one of the highest yielding forms of government spending there is, it is both in the governmental and public intrest to invest in this form of public spending. Education is one of the most important forms of prosperity.

 

[volition]

And then uni becomes a domain for the rich, and a much broader skills shortage will occur. Bring back Whitlams free education anyday.

Oh yeah just thought I'd throw this in: It was never 'free', somebody somewhere was paying for it!

People already figure it "amongst themselves" when they pick their courses through UAC and achieve their relevant UAI's. The HECS system itself is currently 4 tier as well.

Not entirely, they aren't bearing the full cost and universities don't have as much choice over their own operations as I think they should.

 

[bshoc]

Not entirely, they aren't bearing the full cost and universities don't have as much choice over their own operations as I think they should.

All major universities must be entwined to some degree with the government, not only because government is a prime employer, but because only the government can truly dictate what is in the national interest. Letting major universities offer up whatever just means they'll offer up that which is most profitable at the time, bad idea.

 

[volition]

I'm not talking about pensions and super, I'm talking about the people who will be contributing both to the economy and to the tax pool when these people will be in retirement.

Which is at best a positive externality.

Unfortunately people don't think about where the money is coming from. That money would have otherwise gone(or should I say, remained with) to somebody who has worked for their pay, and might need it to pay for some other expense like feeding kids or bills or whatever.

Higher education is one of the highest yielding forms of government spending there is, it is both in the governmental and public intrest to invest in this form of public spending. Education is one of the most important forms of prosperity.

I don't doubt that education is important for prosperity, and people will still be educated so there's no real contradiction here.

If it were truly that good for the average joe who isn't at uni and didn't go to uni, to pay for some kid's education (bear in mind he has probably never met this kid)then why don't we let them do it by choice and not by compulsion? If they truly believed it to be in their benefit then they would do it right? But once again, "the government knows better than us stupid folk", even though 'us stupid folk' are the ones who vote them in! What kind of fairness is this? It's nothing but a vague benefit in the future, when taxpayers might actually need the money now. Do you really think that some vague future benefit gives you the right to take average joe's money?

What about the way that people just get out of the country after their degree(as Bendent iirc on this forum has publicly admitted that she will do) and shirk paying their HECS debt back?

 

[_dhj_]

One of the effects of HECS, whether intentional or not, is encouraging students with the required marks to choose University Education over TAFE Education. If that is a desired effect this would obviously be a bad idea.

 

[_dhj_]

I think volition's argument is ridiculous. If education is a positive externality the choice shouldn't be given to the "average Joe", because the positive externality by definition is under-supplied when things are left to market forces.

 

[volition]

I think volition's argument is ridiculous. If education is a positive externality the choice shouldn't be given to the "average Joe", because the positive externality by definition is under-supplied when things are left to market forces.

I said 'at best', but anyway, do you think that a positive externality by itself justifies taking other people's money? Because I'm increasingly beginning to think that it really doesn't.

And as I said, the government is already being voted in by 'us stupid people' anyway. So how is it that 'us stupid people' as a collective know the exact quantities and proportions of things that are required?

 

[_dhj_]

I said 'at best', but anyway, do you think that a positive externality by itself justifies taking other people's money? Because I'm increasingly beginning to think that it really doesn't.

And as I said, the government is already being voted in by 'us stupid people' anyway. So how is it that 'us stupid people' as a collective know the exact quantities and proportions of things that are required?

It's not about 'us stupid people' versus the government. It's common sense that providing an interest free loan for students with little or no earning capacity or ability to contribute to society, so that they can gain that earning and contribution capacity is good policy. We rely on the government to implement such a policy because we recognise ourselves as essentially greedy creatures, unwilling to give for the common good without being under compulsion to.

 

[*Minka*]

The optimal solution is to give TAFE students HECS loans but stop giving Arts degrees HECS loans, so hopefully it balances out in terms of funding, but it helps resolve the skills shortage.

I wouldn't say all arts degrees are useless - subjects such as Public Relations, Professional Marketing, International Relations, Foreign Languages are worthwhile areas of study in my opinion. History also falls under the arts catergory and many teachers will take History, Foreign Languages, and English subjects as part of their major and these subjects fall under the arts catergory.

As for the skills shortage? There are always going to be white collar workers as well as blue collar workers.

I study Law/International Relations and I really enjoy the IR major and don't see it as an unworthy area of study. If anything, I think it enriches my Law degree and gives me the chance to study something I like and perhaps evetually work in International Law, or various departments, especially as I speak more than one language. I just find it more enjoyable than Business Admin.

With all that said, I don't see the problem in giving TAFE students HECS loans. $2000 may not sound like a lot of money, but a lot of people don't have that money upfront then and there and should not be excluded from bettering not only their lives, but making an even better controbition to Australia's workforce and economy. TAFE can also be a great place to start and then go to University.

 

[volition]

I think volition's argument is ridiculous. If education is a positive externality the choice shouldn't be given to the "average Joe", because the positive externality by definition is under-supplied when things are left to market forces.

_Dhj_, I was referring to what you were saying about "it's under supplied therefore the government should intervene", I'm saying that the government is only voted in by us anyway! It doesn't know any more than we do, therefore it is not able to exercise any superhuman intelligence and work out what the "true quantity" is.

It's common sense that providing an interest free loan for students with little or no earning capacity or ability to contribute to society, so that they can gain that earning and contribution capacity is good policy.

I'd have no problem with the loan being given by the university or some financial institution itself. My problem is not with the fact that loans are provided, my problem is with the fact that the government takes people's money against their will. Tax should be reduced wherever possible.

We rely on the government to implement such a policy because we recognise ourselves as essentially greedy creatures, unwilling to give for the common good without being under compulsion to.

As I was saying in the other thread, capitalism is the only system I know of where everybody benefits when each person works to his own self-interest. eg. Working harder so you can get the better job results in better allocation. Of course this isn't to say that nobody should be charitable, just that as a general rule people shouldn't be made to pay. What kind of charity is it anyway, if its forced?

 

[_dhj_]

_Dhj_, I was referring to what you were saying about "it's under supplied therefore the government should intervene", I'm saying that the government is only voted in by us anyway! It doesn't know any more than we do, therefore it is not able to exercise any superhuman intelligence and work out what the "true quantity" is.

Government decides for the people because the people literally can't be bothered to make laws and reach decisions through a system of direct democracy on every individual issue. Nowadays Acts of parliament are much more complex than they used to be, and to expect the average Joe to partake in that process directly is unrealistic.

I'd have no problem with the loan being given by the university or some financial institution itself. My problem is not with the fact that loans are provided, my problem is with the fact that the government takes people's money against their will. Tax should be reduced wherever possible.

The government does not take people's money against their will. People vote in a government so that it can implement economic policies that modify the pure market economy. All modern economies are mixed economies containing elements of taxation and welfare. It was only in the 19th century that true laissez faire took hold - the reality was that it did not work for the benefit of the "people" but a handful of rich industrialists, and the will of the people gradually overturned the stance.

As I was saying in the other thread, capitalism is the only system I know of where everybody benefits when each person works to his own self-interest. eg. Working harder so you can get the better job results in better allocation. Of course this isn't to say that nobody should be charitable, just that as a general rule people shouldn't be made to pay. What kind of charity is it anyway, if its forced?

It is a fallacy that everyone benefits simply by working to their own self-interest. You only get that result in a theoretical model that attempts to describe real life but relies on many unrealistic assumptions. Even if we use those assumptions, there are still externalities that flow from consumption or production.

The main thing you need realise is that democracies are govern by consensus. For a government to function at all, a significant degree of consensus that the government needs to be there and that taxation is necessarily to allow it to function. A consensus of ideas is distinct from a rational choice made by the individual acting in self-interest. Nevertheless, the consensus is still a product of our will, a vital creature of the liberal-democratic system that we live by.

 

[volition]

Government decides for the people because the people literally can't be bothered to make laws and reach decisions through a system of direct democracy on every individual issue. Nowadays Acts of parliament are much more complex than they used to be, and to expect the average Joe to partake in that process directly is unrealistic.

I'm not referring to expecting average Joe to be able to directly partake in the process, I'm referring to the impossibility of knowing exactly how to correct this supposed 'underprovision' you were talking about.

The government does not take people's money against their will. People vote in a government so that it can implement economic policies that modify the pure market economy. All modern economies are mixed economies containing elements of taxation and welfare. It was only in the 19th century that true laissez faire took hold - the reality was that it did not work for the benefit of the "people" but a handful of rich industrialists, and the will of the people gradually overturned the stance.

If it were really true that the government doesn't take money from people against their will, then there would be some little box you can tick in your tax return that says "I do not wish to fund x". Where x is obviously whatever the person doesn't wanna fund. It's just this supposed social contract that we've all signed by being born that says they're allowed to just take whatever they want I guess.

I'd like to see how many people would voluntarily pay for things if they really had the option of paying for the ABC or paying for whatever else. Cos I'm sure there'd be plenty of people who would just take the extra cash maybe they've got kids to feed or someone to care for or bills to pay, whatever.

It is a fallacy that everyone benefits simply by working to their own self-interest. You only get that result in a theoretical model that attempts to describe real life but relies on many unrealistic assumptions.

Alright, so which particular assumptions are these?