Push to Give TAFE Students HECS Loans (1 Viewer)

[_dhj_]

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.

It's not a case of finding out the "exact" amount. With any policy there are trade-offs, so it depends on the values of our society and who we vote into government. Do we want a case where only an elite class can afford education? That outcome would obviously not be the most efficient because the gift of intelligence is granted not only to rich people at birth - in the case of education, an efficient allocation of the service is not reached by market forces but by, in my opinion, the principle of meritocracy, whereby HECS places are granted to those with the marks. There is also the moral aim of giving a "fair go" to all, but that does not even need to be relied on as an argument.

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.

You can always move to a deserted island where there are no schools, no hospitals, no transport or infrastruction, no laws, no nothing. In fact even if you encounter savages on that island they will have a form of governmental system whereby its individuals "give and take". It's a case of consensus. Are you willing to give a little to gain a lot?

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?

-That there is one market for every good.
-That all suppliers and producers are price takers.
-That there is a symmetry of information between suppliers and producers.
-That the preference of a consumer cannot be influenced by the supplier or a third party.
-That people think rationally.
-That people always know what's best for themselves at any stage in their lives.

 

[volition]

-That there is one market for every good.
-That all suppliers and producers are price takers.
-That there is a symmetry of information between suppliers and producers.
-That the preference of a consumer cannot be influenced by the supplier or a third party.
-That people think rationally.
-That people always know what's best for themselves at any stage in their lives.

None of those barring possibly the last two are actual assumptions that free marketeers use.

We don't need symmetry of information between suppliers and producers, we don't need them to be price takers. The assumptions of perfect competition are not necessary to the proper functioning of capitalism.

In the case of people knowing what they feel is best for them, yes it is true that people don't always get it right. So as a solution, we can do our research or we can pay an expert to help us out if we feel that we don't have enough information.

Free market thinking asserts that we should have the right to be free to pursue our own interest as each person deems best. Nobody has perfect foresight into an uncertain future, and this is the same no matter what system you use.

 

[loquasagacious]

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.

Clearly you see your IR major as enriching you however the real question being posed by the 'anti-arts' is whether it is enriching society.

You afterall are paying something in the order of 25% of the actual cost and society (via the govt) is footing the bill for the remainder. Clearly you consider that you are getting your moneys worth (because its a break from boring law) but is society? Does an IR major increase your future earning potential (thus netting a return on investment in taxation)? Does it create someother externalities that are worth somewhere in the order of $12-18K for the rest of society?

Remember that university is only attended by a minority of people and ask yourself how your IR major benefits those that don't attend university? And another interesting hypotheitical is if you were paying the entire cost (deferring on HECS) rather than a fraction of it would you still undertake an IR major?

In the interests of disclosure I have almost completed an IR major as part of an accounting degree, I actually find alot of the later year IR courses less rewarding than my accounting courses - however having completed so much of the major it would be foolish to abandon it now. As far as my position goes vis-a-vis the above, I find my IR major meets cost-benefits for myself but is highly unlikely to do so for the rest of society generally, morally how do I continue? Because I only need analyise my selfish concerns. As far as accounting goes apparently we have a shortage so therefore the positive externalities and tax revenue generated by society generally is worth the expense to society of footing the bill.

...........................................................

Returning to the TAFE issue I see no problem with the HECS scheme being extended to TAFEs as whilst it does impose a greater financial burden on the government it would definantly help to address the skills shortage facing australia.

There are however some caveats I do not see a reason why the HECS scheme should subsidise TAFE (except in identified areas of high demand), so in the majority of cases students would be paying 100% of the costs but the payment would be deferred.

Also I believe that the eligibility for TAFE-HECS should be means and liquid-asset tested so we are not supporting those who can afford to pay up-front.

Finally TAFE-HECS should not be extended automatically to those who are recieving a centrelink payment - their eligibility should be determined by their Job Network Member (those on newstart/youth allowance who are not studying are required to participate in the Job Network which aims at placing them in employment - where I work we manage large aspects of the Job Network).

Given the high proportion of TAFE costs in materials/books/etc I would support extending the HECS to cover those costs - through a voucher system not through a cash payment.

 

[kami]

Would it not be better to introduce more money directly into the TAFE system? If only because recently the government has been massively reducing the funds they put into the institution which has so far resulted in; massive cutbacks on important courses, reduced amounts of places, less permanent teachers (w. less income ergo less incentive to find more skilled teachers for recruitment purposes), poor facilities and so on. Sufficient funding would also serve to reduce fees for students - removing the need for HECS entirely.

While some might say this is unfairly placing the burden upon society in general, the fact is that all of the courses TAFE offers are highly vocational so every course would contribute back to the economy directly. It would also help to redress the skills shortage by creating greater incentives to attend TAFE.

And the idea that HECS makes TAFE more accessible for low income students is absolute tripe - anyone on a pension can avoid paying the bulk of their fees and if they become a full time TAFE student then they automatically get this pension. Further, traineeships and apprenticeships and the like are usually sponsored by your employee. If somehow you don't come under any of these categories you can currently pay the (not overly large) fee in installments.

 

[loquasagacious]

How about if there's TAFE-HECS that the cost of some courses go up. That means that the market demand for courses determines what is supplied.

That seems to be more efficient than giving TAFE a big cheque to spend....

 

[kami]

How about if there's TAFE-HECS that the cost of some courses go up. That means that the market demand for courses determines what is supplied.

That seems to be more efficient than giving TAFE a big cheque to spend....

The market is dictating supply and demand for TAFE courses at present - there is simply not enough student demand (though more than sufficient industry interest) to maintain a high level of education at present. The introduction of HECS will not change that trend. It may become advisable to introduce that later, once TAFE has been built up more but at present it would be entirely superfluous.

There are of course other solutions, but they all come to putting money into TAFE so as to make it more viable and then throw it to the market demand. The government simply seems the easiest choice, though rather than the government it could be universities or corporations partially integrating the TAFE system into their own rather than TAFE existing as a separate entity.

 

[loquasagacious]

Your logic is flawed because you suppose that 'if you build it people will come' what evidence is their to suggest that simply pouring money into TAFE would result in students enroling?

The introduction of HECS would definantly increase demand for TAFE courses because it would reduce the upfront costs resulting in a more favourable cost-benefit analysis by students.

Higher pay for trainees and apprentices would also go a long way.

 

[kami]

Your logic is flawed because you suppose that 'if you build it people will come' what evidence is their to suggest that simply pouring money into TAFE would result in students enroling?

The introduction of HECS would definantly increase demand for TAFE courses because it would reduce the upfront costs resulting in a more favourable cost-benefit analysis by students.

Higher pay for trainees and apprentices would also go a long way.

This is the problem with your argument; introducing HECS doesn't reduce the upfront cost. Anyone receiving any government benefits can take one of the majority of TAFE courses for free each year. You also automatically become eligible to receive these benefits once you become a full time TAFE student(govt. benefits again). If your income is high enough that you can't receive government benefits then you have the choice to pay the fee in installments. So the upfront costs for students would not be greatly affected therefore there is not a more favourable cost-benefit analysis by students.

The intent behind my proposal to put more funding into TAFE is that they would then upgrade their facilities, staff and course range (and the resulting reputation which builds from this). All of which are things students seek when selecting their courses.

I'd also like to point out another misconception (not directed at your post btw) regarding the fees:

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

Taken from the TAFE NSW website:

TAFE NSW fees for 2007
Course Annual fee ($)
Statements and short courses 328
Certificate I and II 384
Certificate III 600
Certificate IV 816
Diploma 1086
Advanced Diploma 1302

Apprentices and New Entrant Trainees – in 2007 the maximum annual TAFE NSW fee for an apprenticeship or traineeship course is $384. To be eligible for the capped fee you must provide proof of your apprenticeship/traineeship

These prices are standard across all NSW campuses (regardless of specialisation)unless you are an international student, prices of TAFEs in other states are fairly similar though usually slightly cheaper. So considering the vast number of people who are exempt, and the fact that you can pay the fees by installment if you are not ... then I'm not sure what the article is on about.

 

[loquasagacious]

This is the problem with your argument; introducing HECS doesn't reduce the upfront cost. Anyone receiving any government benefits can take one of the majority of TAFE courses for free each year. You also automatically become eligible to receive these benefits once you become a full time TAFE student(govt. benefits again). If your income is high enough that you can't receive government benefits then you have the choice to pay the fee in installments. So the upfront costs for students would not be greatly affected therefore there is not a more favourable cost-benefit analysis by students.

In the ACT the fees are halved if you are recieving a centrelink payment. But that still leaves upfront costs of say $400 for a CIV and equipment costs which seems to me to be a significant financial disincentive to prospective students.

The intent behind my proposal to put more funding into TAFE is that they would then upgrade their facilities, staff and course range (and the resulting reputation which builds from this). All of which are things students seek when selecting their courses.

How is this funding going to be linked to demand what mechanisms will there be to ensure that we don't see a lovely new creative arts building and not more facilities for apprentices?

 

[kami]

In the ACT the fees are halved if you are recieving a centrelink payment. But that still leaves upfront costs of say $400 for a CIV and equipment costs which seems to me to be a significant financial disincentive to prospective students.

Again, installments. You can pay by semester, for the ACT CIV example you give well halve that and you've got a 200 dollar upfront payment. Which is less than what many uni students payed under USU. The costs for equipment are not that high either, alot is provided on campus, the stuff you're paying for is paper, textbooks and clothing etc. few courses demand otherwise.

How is this funding going to be linked to demand what mechanisms will there be to ensure that we don't see a lovely new creative arts building and not more facilities for apprentices?

Because of the same supply and demand? If they made more unproductive (financially) courses then they'd be exactly where they are now thanks to lack of income. And if those courses are productive then wouldn't they be doing exactly what you hope from your earlier proposal?