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Norton Report Provides Sensible Solution to HE Funding

The Council of Private Higher Education (COPHE) has publicly supported the latest Grattan Institute Higher Education report which calls for the introduction of a standard loan fee on all new tertiary education lending.

The Grattan report Shared interest: a universal loan fee for HELP written by Andrew Norton, Grattan Institute Higher Education Program Director, and Ittima Cherastidtham, Grattan Institute Senior Associate, calls for a 15 per cent universal loan fee to replace the inconsistencies in the current higher education loan program. Mr Norton said in the report that such a fee could save the Commonwealth $700 million a year and make HELP fairer and stronger.

COPHE CEO Adrian McComb said COPHE has long advocated for a single, consistent loan fee, because it was equitable higher education policy.

“The current 25% fee for undergraduate students enrolling outside public universities is blatantly inequitable,” he said.

“Given there was both public and private benefit to students from courses, we consider a sharing of cost between government and student is warranted. However we would propose that a fee under 10 per cent would reflect a shared cost while still helping to contain the cost to government of the expanding loan scheme balance," said Mr McComb.

 “As well as treating all students equally, such a fee is better than charging a real interest rate, because that would penalise low-income earners who take longer to repay their debts.”

 Mr McComb said that students should be treated consistently irrespective of where they enrol in our tightly regulated higher education system.

"Recovering interest costs through a loan fee as a proportion of the amount borrowed is consistent with the original intent of our income-contingent loan schemes which removes the barrier of up-front student fees," Mr McComb said.

The report is available at http://grattan.edu.au/wp-content/uploads/2016/12/883-Shared-interest-A-universal-loan-fee-for-HELP.pdf

Inquiries: Adrian McComb amccomb@cophe.edu.au

 

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