Tertiary fee drop – excellent proposal from Labour

Written By: - Date published: 9:02 am, January 22nd, 2016 - 138 comments
Categories: education, labour, tertiary education - Tags: , , , , ,

Education is a public good. We all benefit, socially and economically, from a well educated populace. A couple of days I wrote about a disastrous fall in student numbers that is undermining tertiary education in NZ.

It isn’t the same data set, but this a related 2014 government report starts with an interesting graph:

student-numbers

The net fall following 2010 was not unexpected:

Budget 2010: Move to free up course-fee increases rattles student unions

The Government has ditched the “fees maxima” policy which caps tertiary education fees at a set monetary level and will instead allow institutions to raise all course fees by up to 4 per cent from next year.

The change, made in yesterday’s Budget, has prompted concern from student unions …

He said overall the Budget was a double blow for students, who faced higher fees as well as stricter criteria for student loans and allowances.

Falling student numbers are a problem. Rising fees and debt are a problem, both as a matter of social justice, and because it contributes to falling numbers. For these reasons I was hugely encouraged to see this proposal from Labour yesterday:

Tertiary fees ‘likely to drop under Labour’

Tertiary fees would likely drop significantly under a Labour government as part of a rethink to address increasing student debt, the party’s new tertiary education spokesman says.

Chris Hipkins, who picked up the portfolio after a reshuffle of Labour’s caucus rankings in late November, said nominal student loan debt would pass $15 billion this year — and that should ring alarm bells.

Alarm bells should have rung long, long, long before that ridiculous figure.

He said the Government was not dealing with the “fundamental issue”, which was that the increasing cost of getting a tertiary education was driving the rise in student borrowing.

And the fall in numbers. So reducing fees is a good start. But as an end-goal I’m in favour of free tertiary education. Which Hipkins didn’t rule out:

Germany has recently abolished tuition fees. Asked if Labour would consider that, Mr Hipkins said “a range of options” were being considered. “We will certainly be looking at ways to bring down the cost of tertiary education.”

More like this from Labour please.

138 comments on “Tertiary fee drop – excellent proposal from Labour”

  1. BM 1

    2014

    Students 132,297
    Staff 19,966

    Nearly 60% of the sector’s expenditure of $3.3 billion went on staff salaries and related costs.

    http://www.universitiesnz.ac.nz/nz-university-system

    One staff member per 6.6 students seems unbelievably high.

    • r0b 1.1

      One staff member per 6.6 students seems unbelievably high.

      Teaching is not the only thing that universities do. They do research. They engage with the community. They maintain massive campus infrastructure and grounds. They administer large and complex businesses. There are lots of jobs at universities for lots of reasons. (Not to mention that a fair bit of university teaching is 1 on 1 or small group, as it should be.)

      And none of that has anything to do with student fees and debt – which was the topic of the post.

      • BM 1.1.1

        Maybe universities could trim costs to make education more affordable for students, instead of once again expecting the tax payer to pick up the tab.

        Cut costs =cheaper student fees and less debt.

      • Rich 1.1.2

        “They do research. They engage with the community. They maintain massive campus infrastructure and grounds. They administer large and complex businesses”

        So each student’s $30k+ debt goes to funding a small shrub in the corner of the university grounds – it’s good to have nice places, but why does this cost needs to be applied to a student’s learning?

        In my field, I notice that most (all?) universities maintain a large and expensive (despite badly paid staff) IT Services department, which dates back to the days when computers were kept in sealed rooms with white-coated attendants [you’d see an image here, if LP would enable them]. Nowadays, they provide services which are available elsewhere, either free (like email) or as a cheap commodity (like hosting). Instead, student fees are loaded with these pointless costs.

        This all does make a difference to student fees and debt – if universities didn’t carry all these overheads, fees would be lower (as is demonstrated by Southland Tech) and hence debt would be reduced.

        David Graeber (himself an academic) touches on this in his book The Utopia Of Rules, which I’d recommend reading.

        • BM 1.1.2.1

          So, you’d say there’s quite a lot of fat in the system?

          • linda 1.1.2.1.1

            better idea lets nail the rich fuckkers to the wall who are not paying there fare share of taxes if we a arrest debtor students we can really go after criminal tax evaders with the same vigor.

        • Psycho Milt 1.1.2.2

          Nowadays, they provide services which are available elsewhere…

          I’m picturing telling students that no, we don’t provide computers, applications, printing, file storage or a network any more, but they’re welcome to arrange those things for themselves. First words out of their mouths: “But I’m paying you fees!”

          • Rich 1.1.2.2.1

            How many students don’t own a laptop? Or know how to get to Google Drive?
            Or have a phone plan with way more gigabytes than the uni would ever let them have?

            As I say, when computers were strange and new, universities had to provide them (although even then, departments usually had their own because the Computing Service, as it styled itself then, was useless). Nowadays, it’s like the university bundling clothes, food or a car along with the fees. (Although that would be kinda popular with overseas students whose parents couldn’t read the small print).

            • McFlock 1.1.2.2.1.1

              How many students can access a high performance computing centre via a high-speed dedicated link?
              How many students can manage the records of students, room allocations, and payments relating to 20000 students, 4000 staff, and well over a billion dollars worth of infrastructure going back the past thirty years to aid planning well into the future?

              How many students manage the maintenance, upgrades, and inter-operability of all staff and student computers on campus?

              It’s not just banging out 1200 words on the role of the pumperknickel in 16th century Flemish politics.

              • Rich

                Oh come on. You know that undergrads never get let loose on all the high-end things that universities have – you might get time on an HPC computer system as a postgrad, but it would be cheaper to spend your project dollars with AWS, if the uni would let you…

                And the line-of-business stuff to manage students is another area entirely – students don’t access this directly, its just an overhead on providing their education.

                I’ve had cause in the past to do fairly simple jobs for university customers where they needed a server/website which had to be on their network – in every case, what would have been a two hour job on AWS (create a server, install packages, hook it to a domain) turned into weeks of negotiating with ITS, who in turn no doubt spent hours setting it all up. Working hard, but not smart.

                • McFlock

                  You railed against universities having IT services on the basis of what only students need.

                  Despite your assumption that every student has a laptop capable of running any software they might require for their course, the fact is that university IT involves a shedload more than just what students need to write an essay. And that’s before we get into someone using megaupload instead of dropbox to store their data, only to find one day that the feds have stolen it all.

            • Psycho Milt 1.1.2.2.1.2

              Rich, if you had to support the gear that some students try to use for access to university systems, you’d understand why so many of them are keen to use the stuff the university provides. The age and decrepitude of some of the devices we get asked to help with are really quite astonishing.

            • simbit 1.1.2.2.1.3

              In my exoerience about 10% lack hardware and 30% the necessary skills to negotiate the technology. When IT issues arise (and we have regular outages, shutdowns, updates, and data losses), students and staff need to be back online in under an hour.

  2. Draco T Bastard 2

    Three things need to happen:

    1. All outstanding student loans need to be written off
    2. All education needs to be free
    3. Anybody not working needs to be helped into education

    • pete 2.1

      And we all need to be given a free BMW and petrol vouchers for life by the government.

      • Stuart Munro 2.1.1

        No, but selling the ministerial BMWs will create a nice saving. They can take the bus.

      • The thing is, the government doesn’t nominally have a value of giving away BMWs. It does have one of free education. (although in reality even primary and secondary education is no longer free with compulsory “donations”, hence “nominal”)

        Speaking of German goods and services, guess what they do in Germany? You pay no tuition for undergraduate courses. You pay a small administration fee to the university, and the government foots the bill because it recognises that educating people enhances its society and attracts skilled migrants. That’s pretty close to free education, Pete.

        • pete 2.1.2.1

          Hi Matthew. Yes that is pretty close to free education. But that does not necessarily make it good policy. The fees are already very heavily subsidised.

      • Crashcart 2.1.3

        Yea because free education is such an out there concept. It’s not like most of those sitting in parliament at the moment took advantage of free education is it.

        • pete 2.1.3.1

          Yes but they are planning for the future, not the past.

          • Crashcart 2.1.3.1.1

            Good thinking. There is no way that have a more educated populace would be considered planning for the future.

            • pete 2.1.3.1.1.1

              It not a case of more educated or less. The key is appropriate education for the appropriate people. That is, admission based on merit (grades) not the current system of open door to anyone who fills in a format on the Web.

              Do you not think for example that the current system of apprenticeships not being subsidised (or their essential tools that usually costs these young people many thousands) is unjust? It’s weird that the people on here only seem to extend their welfare concern to those who will on graduation be the middle class. Scant concern for the working class from labour or to see on this is site

              • Draco T Bastard

                The key is appropriate education for the appropriate people. That is, admission based on merit (grades) not the current system of open door to anyone who fills in a format on the Web.

                What a load of bollocks.

                The correct amount of education that people need is as much as possible. More education brings about more ideas and understanding of how society works.

                If we followed your ideas then my nephew wouldn’t be the successful carpenter that he is. Instead he’d be a minimum wage hammer-hand that he started work as.

                Your idea actually limits those things. Of course, the rich and National like that idea because then people don’t start demanding changes.

                • pete

                  I am.sure your nephew does not need a PhD to be a successful carpenter, which is the extension of your argument.

                  In fact, in my working experience those who are over educated for their job are a pain in the arse. They too often mistake education for intelligence and try to Lord it over the real workers.

                  This is the problem with current crop of Labour mps: over educated and underachieving. Many have spent their entire life as middle class beneficiaries and consequently have almost no understanding of the working people and their needs.

                  And I have met many many people who have chosen a trade and thearby have little post high school education who are extremely successful and demonstrably intelligent. Their lack of a tertiary education in no way limited them vocationally or socially.

                  • Draco T Bastard

                    I am.sure your nephew does not need a PhD to be a successful carpenter, which is the extension of your argument.

                    No it’s not. My nephew dropped out of school without even School C. According to you he wouldn’t have qualified to get the education that he got to become a carpenter.

                    In fact, in my working experience those who are over educated for their job are a pain in the arse.

                    Actually, the real problem is the one you’re displaying right now:

                    The Dunning–Kruger effect is a cognitive bias in which relatively unskilled persons suffer illusory superiority, mistakenly assessing their ability to be much higher than it really is.

                    Basically, you’re too ignorant to understand that you’re an ignorant oaf.

                    And I have met many many people who have chosen a trade and thearby have little post high school education who are extremely successful and demonstrably intelligent.

                    And I’ve met the same type of people and they, too, demonstrate the Dunning-Kruger effect very well. Even worse in many cases as they think that they being rich actually proves that they know what they’re talking about.

                    • pete

                      No being rich does not equal intelligence necessarily anymore than education does. And please refrain from hurling abuse whenever someone has a differing opinion than you. It merely undermines your argument and even proves that over education is a dangerpus thing indeed.

                      I have a BA/BCom with a professional qualification of CA and CPP.
                      And gee, I actually paid back my student loan. It was a good investment for my future, a little like buying a house.

                      And I also like your nephew left school with (in my case) insufficient qualifications to study at university. I went to Hagely High School in ChCh in evening classes to get UE, and my first university year was parttime whilst i worked. Did not need a band playing violins to achieve this. this a little effort and common sense.

                    • Draco T Bastard

                      And please refrain from hurling abuse whenever someone has a differing opinion than you.

                      What abuse? I merely pointed out that you’re coming from a position of ignorance and you just proved it.

                      No such thing as ‘over education’ and the true danger is operating from ignorance.

                    • Pat

                      “And I’ve met the same type of people and they, too, demonstrate the Dunning-Kruger effect very well. Even worse in many cases as they think that they being rich actually proves that they know what they’re talking about”

                      citing Dunning-Kruger effect for this is somewhat specious….and wealth was not a factor mentioned…..would also note there are many informally trained who are highly regarded by the formally qualified, often to the extent of conferring honorary degrees.

                    • Draco T Bastard

                      @ Pat

                      citing Dunning-Kruger effect for this is somewhat specious

                      Nope. There really are people out there who are successful in the trades, are completely ignorant and yet think that they know what they’re talking about. I’ve met them.

                      and wealth was not a factor mentioned

                      I assumed that when pete said “little post high school education who are extremely successful” he was referring to people who were well off.

                      would also note there are many informally trained who are highly regarded by the formally qualified, often to the extent of conferring honorary degrees.

                      Yep, met people like that as well.

                      @pete

                      Did not need a band playing violins to achieve this. this a little effort and common sense.

                      You had the benefit of having a job. Very difficult to get one of those these days with such high unemployment and the student loan is not enough to live on.

                      I’m not looking for violins but some actual support rather than the kick in the guts that both National and Labour have been doing to students and other beneficiaries.

                    • Pat

                      “Nope. There really are people out there who are successful in the trades, are completely ignorant and yet think that they know what they’re talking about. I’ve met them.”

                      I don’t doubt you have….hardly a basis for the sweeping statement you made….just as there are nominal tradesmen who have an inflated opinion of their abilities so there are graduates with scant understanding of their field.

                      ‘I assumed that when pete said “little post high school education who are extremely successful” he was referring to people who were well off.’

                      please don’t tell me you are one who automatically equates “success’ with monetary position….that is a very narrow and in my opinion, invalid appraisal….indeed I would suggest it is almost a success substitute.

              • Crashcart

                Has anyone here argued against differing education for differing people? I haven’t seen it. In fact removing tertiary costs frees students up to try different subjects or trades and find what best suits them.

                The current system has an arbitrary measure of whether you can get the money as to whether you will be able to attempt to get the education. Removing the cost in no way indicates that you don’t have a merit based system for entry to courses.

                If every one has the option to try and gain the education they need to pursue the career they are suited to that can only be better for society as a whole. Removing the barrier of cost is a step towards this. There are still many other issues that need to be addressed but that is no reason to not start down the path.

                • pete

                  A student loan does not limit them either. Just makes them hopefully think a little more before they fill in their online application.

                  • Crashcart

                    A student loan does limit them.

                    So you liked Metalwork when you were in school. You put in your student loan to become a Mechanic. Turns out you are not suited and don’t enjoy it. Shit you now have a loan to pay. To try and change and find a career that not only would you enjoy more but probably be better at, will just load you up with more debt.

                    I know it is a hard concept but expecting someone at 17/18 with almost no life experience to choose what they are going to sink themselves into for the rest of their lives is not the best idea.

                    • Draco T Bastard

                      I know it is a hard concept but expecting someone at 17/18 with almost no life experience to choose what they are going to sink themselves into for the rest of their lives is not the best idea.

                      QFT

                      And then throw in changing technologies. My father was a toolmaker and by the time he retired there was no call for them. And that sort of thing is happening faster and faster. We still have street cleaners but how long before that’s done by machine?

                      So many RWNJs still have the delusional belief that you go out, get an education and that’s it – you’re set for life.

                  • Draco T Bastard

                    A student loan does not limit them either.

                    Yes it does. In fact, that’s its point.

      • acrophobic 2.1.4

        And beneficiaries need to get subsidised housing and cheaper education (via the decile system) and cash to move town and cash to move house and … oh wait … they get that now!

    • Hutty 2.2

      I have been fortunate enough to have late last year paid off my Student Loan over numerous years of chipping away at it. Don’t you think it would be absolute garbage that people who have not been paying it back just magically have theirs written off? Will I be refunded by the government?

      All students know what they are getting into when the sign the loan documents. It would be a terrible precedent just to write it off.

      • I think everyone who paid towards the balance of their student loan while living in NZ should ideally have that balance be forwarded to the income tax division of IRD and written off your upcoming tax bills, or refunded to you if you only pay PAYE.

        BUT I don’t see that as being as likely to happen as simply writing off outstanding debts and preventing new ones by eliminating fees for NZ residents. At the very least those of us who took out loans and repaid them in part or full can be glad that nobody else will have to go through that BS.

        It would NOT be a terrible precedent to write off the loans. Students certainly knew what they were getting into, and that generally earning more but getting the loan was a better choice, but it still largely drives people overseas where there’s a wage gap from living in New Zealand, as even writing off the interest doesn’t do that much.

        I’d much rather IRD simply tracked the student debt principle for people residing in NZ, and wiped out the principle if you work here for a set number of years. (5? 10?) You can repay back the whole thing with interest if you move overseas for cushier wages though IMO.

        • BM 2.2.1.1

          The thing is though, you’re going to university to get a degree and therefore a much higher paying job.

          Why should I pay for that?, I wouldn’t want to pay for the guy/girl down the road to start up their business, why should I have to pay for your degree.

          You’re investing in yourself for personal gain, of course you should pay for that.

          Maybe if people thought a bit more about going into debt for some degree that has little to no job prospects, the student loan situation wouldn’t be as bad as it currently is.

          • Crashcart 2.2.1.1.1

            Ignoring the fact that improving the education of the population in general is good for every one (improved economy and reduced crime) you won’t be paying for it. The government will. Taxes will always be used for things we don’t agree with.

            • BM 2.2.1.1.1.1

              Think you’re missing something.

              The government collects tax of employers and employees to pay for services and products to keep the country running.

              The more services the government supplies the more tax that needs to be raised. For the less well off this extra tax means less money to buy food and pay for rent.

              I don’t think it’s particularly fair to punish the lower paid because a bunch of middle/upper class people don’t want to contribute to the costs of getting a better education so they can get themselves a high paying job.

              • Pat

                “I don’t think it’s particularly fair to punish the lower paid because a bunch of middle/upper class people don’t want to contribute to the costs of getting a better education so they can get a high paying job.”

                answer ….progressive taxation

                • Lanthanide

                  That’s a bit of a circular argument:

                  It’s unfair that people have to pay for their own education, it should be free. Make the government pay for it!

                  The government needs more money to fund this education.

                  Tax the people who got an education and therefore a highpaying job so that the government can pay for the education.

                  All you’ve really done is swapped student-loans for higher tax rates.

                  • Pat

                    yes you are in effect correct…but it is a more cost effective method without the additional admin costs, defaults, debt collection….and ridiculous compounding penalties…and thats at both ends, the provider and the govt.

                    • Lanthanide

                      It also means people can get free educations in NZ, then go elsewhere in the world and never pay a cent towards their education.

                    • Draco T Bastard

                      If we developed our economy properly then people wouldn’t leave except for a holiday here and there.

                    • Pat

                      there is more than just funding that needs to be addressed….the academic independence and security are two that spring to mind….but consider, what does any academic (or most for that matter) want?,,an environment where he or she is relatively free to pursue their interest…and perhaps secondly to mentor the next prodigy….build it and they will come (or stay)

                • BM

                  Wouldn’t to be cheaper and simpler to just have people paying some of the cost of their tertiary education?

                  You know, like what we have now.

                • linda

                  7 billion in tax evasion by tax crooks every year let start with them

              • Crashcart

                I am not missing that at all. Each government has to prioritise its spend and try to meet the costs of that spend. I understand that a government you support wouldn’t feel that free education is a high enough priority to either shift spending or increase tax intake. I on the other hand would support a government that does.

                Its a false claim that the poor would be punished. The assumption is that the tax would be raised from them. There are many other more progressive ways to apply tax. Yes that would mean if you get the education and get a higher paying job you would pay a slightly higher tax rate to cover that cost, however you still get that job and you get to move towards a future with out a debt burden.

                That is the bit you ignored in your initial position about your tax dollars. More people in higher skilled employment means high tax intake, off setting the increased costs. Of course as CV points out below there would also be a requirement for there to be jobs for them to go into. I often hear the term skills shortage but I honestly wouldn’t know what sort of increase in qualified workers this could soak up.

            • Lanthanide 2.2.1.1.1.2

              There is a direct and substantial private benefit to tertiary education (assuming you study something valuable).

              I don’t see why it is wrong to expect the individual who is receiving that direct private benefit to share some of the burden of the cost.

              • Pat

                both societies a whole and the individual benefit from tertiary education…but even dismissing the societal good the bulk of graduates under a progressive taxation (more so than current) system do indeed share the cost for that personal benefit.

                (meant as reply to BM)

                • Pat

                  that is true Lanthanide….it is an issue that wasn’t so prevalent back in the day (and may not be into the future, who knows how the world will develop)…but if monitored there are ways and means to mitigate that issue if it becomes problematic, besides the swings and roundabouts argument applies, if skills mobility is the continuing world trend we attract overseas trained (and financed) graduates in return

              • Matthew Hooton

                I am currently studying philosophy at the University of Auckland with a particular interest in integrating Buddhist metaphysics and Aristotelian ethics. I am not sure whether or not you would consider this to fall under your use of “valuable” but I receive substantial private utility from this. Nevertheless, I welcome Labour’s indication they may get the taxpayer to pay a bit more and me a bit less for my PhD in this topic, which I expect to begin in 2018. It would be great if they made it entirely free for me, and made the taxpayer pay the full amount. After all, as Anthony Robins says, it is really a public not a private good despite the utility I gain (at least that’s my story).

                • Pat

                  lol…there are always exceptions that prove the rule…I think it would be fair to say a progressive taxation regime would capture you regardless of the financial benefits of your study…there are also other areas of study (such as BSW) that are unlikely to push a graduate into a high tax bracket…..it is a system that works in total, and should be assessed as such

                • Ad

                  Impressed you restrained yourself from doing political theory.

                  All the best with the great Nichomachean Ethics! I loved that stuff; it resonated much more than Singer and the utilitiarian ethicists.

                  I think I can still remember most of his virtues.

                  • Michael

                    I think Matthew Hooton could really benefit from studying ethics, although I suggest he starts with the basics, and gets them right, before moving into the higher realms. Hooton’s Dirty Politics activities indicates he has absolutely no understanding of ethics, particularly its practical applications in daily living. After he passes Ethics 101 (which might take him a few attempts, FWICS), I recommend a course in Virtue Ethics. I’m unsure whether Rosalind Hursthouse still teaches at Auckland University; if she does, Hotton should seek her out: Hursthouse is a pioneering figure in the latest iteration of Virtue Ethics. Finally, we’ll all know whether Hooton has learned his lessons from the calibre of his posts on this site.

                • alwyn

                  What big words you can use. To save me the trouble of looking them up can you assure us that what you have said makes at least some sense?
                  Actually they look like the sort of thing I have seen in quite a lot of theses.

                  I had a look at the student loan scheme some years ago. It was only curiosity and I had no intention of going ahead, for anyone who gets all excited about these things and might want to abuse me.

                  As a retired person of mature years I was curious whether I could get a student loan for living expenses. I would find some course of study that did not incur any fees. Then I would borrow toward my living costs and get a higher income.
                  If I still owed the borrowed money when I died it would all be written off, so that didn’t matter.

                  Unfortunately it appeared that I had too high an income. I would effectively have to pay the loan back as fast as I received it. Bummer.
                  On a lower income it did seem to be feasible. At least the current Government has wiped out that little trick, although I wonder if anyone actually took it up? Anyone know of people over 60 who took out a student loan, although never planning to work again?

          • Tony Veitch 2.2.1.1.2

            Congratulations. Spoken like a true neolib! Why on earth should you contribute to making society a better place for ALL citizens! What’s in it for you?

          • Draco T Bastard 2.2.1.1.3

            Why should I pay for that?

            Because you would be better off. As I said to you before, all education is a public good first and the personal good is a subset of that.

            Maybe if people thought a bit more about going into debt for some degree that has little to no job prospects,

            Maybe if you RWNJs thought more and had more education you’d realise that education is about far more than just getting a job. Society depends upon everyone having a good and diverse education.

            • Once was Tim 2.2.1.1.3.1

              “Maybe if you RWNJs thought more and had more education you’d realise that education is about far more than just getting a job.”

              +1

              For those RWNJs tho’ ….. uphill. shit. push.
              (Alien concept…. does not compute….. does not fit with their rote style ‘learnings’ going forward)

          • Once was Tim 2.2.1.1.4

            “The thing is though, you’re going to university to get a degree and therefore a much higher paying job.”

            See that’s where you fail by using such an assumption.
            That might be the theory – the reality is quite a different story.

            Commerce graduates staffing call centres or Dominos Pizza outlets
            Media Studies grads clamouring for Weldon-type pozzies (even prepared to fuck the boss)
            Let’s not even begin with Law grads.

            The only thing they have in common is huge debt, and the only chance they have of getting ahead (going forward) is to subscribe to Natzi style cronyism and aspirational-style hope (going forward)

            Congrats trollsters – you’ve successfully commodified tertiary (and lower style) qualifications and made them as useless as tits on a bull.
            Please don’t moan tho’ when the shit hits the fan

        • Matthew Hooton 2.2.1.2

          How much would that cost? Loans have been being repaid since 1992. Would $100 billion have been repaid in that time? Anyone know? (I don’t)

      • Draco T Bastard 2.2.2

        Don’t you think it would be absolute garbage that people who have not been paying it back just magically have theirs written off?

        No.

        Will I be refunded by the government?

        Of course not as that would be retrospective legislation.

        It would be a terrible precedent just to write it off.

        No it wouldn’t.

        • Hutty 2.2.2.1

          So it’s just a case of tough cookies for the thousands of other people who have repaid their obligations?

    • mac1 2.3

      Approximately 108,000 FTE NZ students paid some $900 million in fees. (Foreign students total some 19,000 and per capita probably paid $161 million.)

      Government expenditure currently $94.3 billion.

      Free education at University would cost an extra $900 million on top of the $1.4 billion grant already paid. That $2.3 billion would be 2.4% of total govt expenditure, as against 1.5% now.

      Now, how would we go about gaining $900 million extra revenue?

      Well, tax avoidance in New Zealand is about $7.4 billion per annum.

      Tax avoidance could be said to cost this country free university and school education, and a poverty free society.

      QED.

      • Craig H 2.3.1

        I’ve seen various estimates on tax avoidance, but in a lot of cases, the figures are actually income, so tax would be paid on that.

        • mac! 2.3.1.1

          From the source I quoted below to Colonial Viper, (http://www.victoria.ac.nz/research/expertise/business-commerce/fraud-sentencing), this is quite clearly a reference to revenue, not income.

          “While it is difficult to get accurate figures for tax evasion, the Tax Justice Network estimates New Zealand missed out on more than $7.4 billion of tax revenue in 2011, or around $1,500 per New Zealander.”

          • Craig H 2.3.1.1.1

            I tried really hard to find the report itself online (and I’m normally not too bad with the Google Fu), but could only find articles which referenced it, and couldn’t find it on the Tax Justice Network website.

            Also, that was the best part of 5 years ago, and is probably based on older data than that, and IRD has had 5 years of increased cash to crack down, so maybe things have improved slightly since then.

            (to my right, outside the window, there is a pig flying past…)

            Still, it would be nice to see the report if anyone can find it!

    • Justme 2.4

      Before student loans came in, the computer labs were empty most of the time. Once the loans came into effect, the computer labs were full, at midnight on Saturday.
      Students knew there was a cost involved for not passing. It also got rid of those who were “studying” so they didn’t have to get a job.
      It also encouraged people to consider that at the time, a plumber could be earning more than some graduates ever expected to, without the debt.

      • Draco T Bastard 2.4.1

        Before student loans came in, the computer labs were empty most of the time.

        Bollocks. I’ve been in tertiary education before and after student loans and it was the same – students in there playing games, doing the needed research and other work. Before fees and student loans were introduced many people couldn’t actually afford to have a PC at home. And that’s got nothing to do with student loans making PCs available but the fact that PCs are now cheap enough that nearly everyone can afford them.

        Students knew there was a cost involved for not passing.

        That would be wishful thinking on your part.

        It also got rid of those who were “studying” so they didn’t have to get a job.

        I’d rather have people doing that than sitting at home on the unemployment benefit. Chances are they’d migrate into a teaching role and/or probably start doing some research from out of left-field that nobody else would have thought of because they wouldn’t have the broad education needed.

        It also encouraged people to consider that at the time, a plumber could be earning more than some graduates ever expected to, without the debt.

        Well, plumbers are still paid more per hour than lawyers but the number of plumbers is actually going down while the number of lawyers is going up.

      • Pat 2.4.2

        “Students knew there was a cost involved for not passing. It also got rid of those who were “studying” so they didn’t have to get a job.”

        I can recall a couple of people that could have been applied to back when Tertiary Ed was free (nominally) and also recall how it was approached…a student not performing ,and wastefully filling a place , who was simply there to party and avoid paid employment lost STB, were required to pay fees and had it put to them it was time to move on……it was effective.

    • Craig H 2.5

      I’m on board – someone has costed that out (I forget who – Greens, I think), and the free education is not actually especially expensive (relative to the current costs), while writing off the student loans is a bit more expensive.

  3. The Chairman 3

    It’s a shame Labour didn’t specifically state how they plan to achieve their goal.

    • BM 3.1

      Raise tax or borrow money, what other options are there?

      • One Anonymous Bloke 3.1.1

        Definitely raise taxes: the US economy, for example, was much stronger when the top tax rate was 70%. I’d like to see the top tax rate raised to 500% for ladder-kickers though, and redistribute their homes and assets to some decent Kiwi families.

      • Stuart Munro 3.1.2

        Community education through peer tutoring is remarkably efficient and thus cost effective, and web delivered content will become increasingly important. As part of a blended delivery continuum universities have an important role. But equally important will be weeding out the corrupt and incompetent providers that the Gnats are larding into the system – the Novopays and the charter schools, the NZIBS and the dodgier polytech offerings. This will save a lot, but it is not saving that is the object, but fostering.

        Education is the logical modern Keynesian field as infrastructure was last century. And as with the infrastructure, the courses must be intelligently integrated with needs and opportunities. We don’t need bridges to nowhere and courses to nowhere aren’t much better.

      • mac1 3.1.3

        Another option, BM, is for all those tax-dodging bludgers in New Zealand to pay their fair share. At the moment, the figure is $7.4 billion annually- $1600 per head of population lost to government revenue.

        So, no need to raise taxes- just to collect what is owed.

        • BM 3.1.3.1

          Ever asked a tradie if he/she would do a cash job?

          Only way to get rid of tax-dodging is to get rid of cash.

          • mac1 3.1.3.1.1

            Answer to question one. No.

            Answer to how to get rid of tax-dodging is to do what the government today did to a university fee dodger at the airport.

            • Colonial Viper 3.1.3.1.1.1

              LOL you’re dreaming. You’re also utterly lost.

              How is airport enforcement going to convince Google, Apple and BNZ to pay more tax?

              Of course, it isn’t, is it.

              • mac!

                For airport enforcement read purely enforcement- what happened at the airport was one example of government action from a wide range of possible enforcement options. I am advocating stronger action to enforce our tax laws.

                I am sure, CV, that you are not advocating walking away from tax dodging as too hard.

                I also am not sure that we are talking about the same thing. The article below which i quoted from is about criminal evasion. Are you talking about avoidance with your three examples?

                Read the following for the size of the problem, and how government deals with it from one academic’s research.

                http://www.victoria.ac.nz/research/expertise/business-commerce/fraud-sentencing

      • In the short term, it would probably need to be funded by extra revenue or reduced spending in other government areas.

        In the long term, if the policy is designed so it wipes out student debt for people living in NZ only, the costs will come back to the government in increased circulation from graduates spending that money in the economy, (which means the government will take in GST and corporation tax from most of the forgone revenue anyway, meaning you’re probably only forgoing about 61.2% of the revenue if you assume on average the forgone revenue is spent only once- in reality it’s likely to be spent more than once, as a percentage of corporate revenues will be dispursed within NZ as wages and for goods and services) or offset the government’s need to get graduates into saving. It will probably also retain more skilled graduates to NZ thus addressing the skills shortage in the country to some degree. It’s kinda win-win in the long term, with it ending up being an equation of “we trade 50-60% of the student loan revenue in order to keep students out of debt and in NZ”.

        • Craig H 3.1.4.1

          I agree, and quite like the concept of still having loans, but not collecting repayments and writing off the loan over time for people who work in NZ. The only issue is collecting from overseas-based borrowers is costly and difficult if they choose not to pay.

      • The Chairman 3.1.5

        Reshuffle expenditure, seek revenue generating investment, increase royalties on resource extractions.

    • Lanthanide 3.2

      Yip.

      While this is a ‘nice signal’ from Labour, at the moment it’s just empty words.

      I wouldn’t be surprised if the eventual policy ends up being some sort of fees remittance in return for good grades, and then potentially an extra bonding thing where so many $ are forgiven from student loan debt if the graduate stays in NZ for a certain number of years.

      Simply because these are ways that you can give reasonable relief to those who are performing the best, which is cheaper than an across-the-board reduction in fees which arguably those who go to uni and party then drop out don’t deserve.

      I don’t see where Labour is going to get the money to do substantial across-the-board reductions, when there are already so many other parts of the government that National have been clamping down on that are in urgent need of additional funding.

      • Lanthanide 3.2.1

        Suggested schedule for SL forgiveness:
        1x in first year, 2x in second year, 3x in 3rd year living in NZ after graduation.

        x =
        For bachelor (3 year degree): $1,000
        For honours (4 year degree): $1,250
        For masters: $1,500
        For doctorate: $2,000

        Could potentially also add $500 for a 2-year diploma and similar levels of qualification.

        If this were also retroactively applied to all existing graduates who hold SLs, not just ones that graduate after the policy is introduced, it will bring that SL figure down rapidly.

        It wouldn’t be good for the government books though, because SL debt is counted as an asset for them.

        • Stuart Munro 3.2.1.1

          The rate might be a little slow – I’d imagine year parity would be more reasonable – 7 years in NZ pays off a PhD, 3 years a bachelor’s. Preventing graduates travelling is kind of Stalinesque, I don’t want it to be common.

          • Lanthanide 3.2.1.1.1

            Except what you’re proposing is massively expensive, and would be even more of a disincentive for graduates travelling than mine, given its generosity.

            My 3-year degree cost me about $20,000 for my SL. Knocking off $6,000 over 3 years, in addition to interest-free student loans, is very generous.

            • Stuart Munro 3.2.1.1.1.1

              We have to temper claims of expensiveness with the reality that a large proportion of student debt is expected to be unrecoverable (40% was the last figure I saw). At one point this government was talking about selling student debt at 50c on the dollar – not to the students of course.

              The whole policy of student loans had some serious flaws – you have an economic crisis in the 80s do you a) retrench b) invest in upskilling your population – successive NZ governments chose a). Education also is a pretty chimerical product – parts of the BA I did in NZ were frankly rubbish, though there was some quality in places too.

              • Lanthanide

                Just because a large amount of student loans are going to be unrecoverable, doesn’t mean we have to go and write all student loans off, which is effectively what you’re advocating. In fact, it is much more in line with my proposal: just bring-forward the write-off that will be occurring anyway, but in exchange for the graduate staying in NZ, which will likely result in additional payback of the remaining balance anyway as there won’t be as many people hiving off overseas where they can’t automatically deduct the payment from wages.

                There is already a bonding scheme for medical professionals, that requires them to work in ‘hard-to-staff communities’. And even that, proportional to the student loan required to get the degrees, is not as generous as what you’re proposing: http://www.health.govt.nz/our-work/health-workforce/voluntary-bonding-scheme

                • Stuart Munro

                  Ok – but I never supported their introduction in the first place, so any logic around them is pretty fatuous to me.

                  I did my MA through a scholarship abroad so I avoided getting stung again here – but NZ is a jobless desert – due to undemocratic and frankly stupid governments. I can never get decent jobs here, and thus am never liable to make loan payments. Abroad is a different story – but the immigration hassles and costs can get pretty onerous.

                  If IRD wanted money from me they should’ve kept the slave fishermen out and I’d still have a high paying job. They didn’t, so fuck ’em.

                • Craig H

                  There’s a teacher one as well for certain subjects (unless National dumped it).

                  Reduce the loan by $100/week or $450 per month is my theory – takes longer for bigger, more expensive degrees, is quicker for something simple.

                  Make it a bigger reduction for qualifications on the Immigration NZ Long Term Skills Shortage List at time of study e.g. double that figure.

                  Allow people up to the age of 30 or 35 to work overseas for up to 2 years + travel time (e.g. 25 months) without accruing interest so they can do an OE/working holiday without being penalised. Continue the deductions if they are volunteering for a decent charity e.g. MSF.

      • The Chairman 3.2.2

        “While this is a ‘nice signal’ from Labour, at the moment it’s just empty words”

        Indeed.

  4. alwyn 4

    Chris Hipkins has really mastered the art of seeming to say something but not doing so.

    “Germany has recently abolished tuition fees. Asked if Labour would consider that, Mr Hipkins said “a range of options” were being considered. “We will certainly be looking at ways to bring down the cost of tertiary education”

    Only the most credulous fan could turn that into anything other than. “I am not agreeing to do anything”.
    Some parties, such as the Green Party, New Zealand First and ACT can promise anything. They are never going to be the dominant party in a Government and are therefore never going to have to put up. Labour, and National, cannot afford to do that. They are both, at some stage, going to be the major party in a Government and it won’t be quite so easy to renege on promises. Thus they sound as if they are promising things but they don’t do so.

    One thing I don’t understand is why some courses take so long at a University. Do they really have to take as long as they do?

    For example. A degree in Pharmacy takes four years of full time study before you get anywhere near working. I realise it is a skilled task and requires much more knowledge than it did 50 years ago but four full years of academic study?
    I would have thought something like two years to start and then refresher courses, say 3 months every five years, would make more sense. Two years would certainly cost a lot less than four.
    Any practising pharmacist care to comment?

    • BM 4.1

      What does a pharmacist actually do?, I’m sure there’s more to it than tipping pills from a large container into a small container.

      • Colonial Viper 4.1.1

        Like so many things its an evolving mismatch between what the university wants to teach, what the profession is trying to make out its members need to know (but often doesn’t really), and the demands which actually occur on the ‘shop floor’ of a retail pharmacy.

        Other examples are when nursing and teaching got turned into research oriented university level degree courses. There were some positive effects and numerous negative ones.

        Like so many professions a lot of what retail pharmacists do is ripe for putting into an AI/automation framework.

        • BM 4.1.1.1

          Are you saying tipping pills from a large container into a small container is basically it.?

          Christ, you’d be disappointed if you spent 30k+ and 4 years to find out that.

          • Rich 4.1.1.1.1

            I think most of it is knowing that a doctor might not have really intended to prescribe five times the lethal dose of an anticancer drug when the patient actually presented with a mild cold.

            It must be a bit dull to sit in Unichem all day decanting pills though. Plus not being allowed to tell people buying “natural remedies” that they’re wasting their money (dubious ethics there – if you buy real OTC medicines, they’re supposed to ask about your symptoms and judge appropriateness – if you buy something from the woo racks, they just take your cash).

            I was told by a pharmacist from the old days (when Boots in the UK did photo developing) that a lot of his work was mending cameras. This wasn’t actually pharmacy, but as the most ‘technical’ person in the store, it fell on him to try and extract snapped films, etc.

          • Colonial Viper 4.1.1.1.2

            As Rich pointed out, figuring out when some prescription is totally out of whack or if the woman who has turned up asking for antacids is actually in the middle of a heart attack not indigestion, is I imagine about the most pressing a typical day might get. Oh yeah, and making sure the pharmacy gets properly reimbursed for $$$ from the health system, that’s a biggie.

          • millsy 4.1.1.1.3

            Yeah because those pills that come from that large container dont have the potential to kill someone (or worse), if the wrong pills are given to the wrong person with the wrong instructions.

  5. Rich 5

    It’s odd that fees are so high when lecturers (and grad students who do a lot of the course delivery) are so badly paid. Also, you can do an increasing range of MOOCs, usually for nothing. And Southland Tech still manages zero fees.

    A lot of what universities are “selling” isn’t teaching, it’s their monopoly on issuing qualifications that are trusted/valued by employers (and of course by universities for higher study). The difference between a free MOOC and an expensive extramural degree course is that you don’t get that piece of paper.

    So you’ve got a great deal of money being taken in – some of it goes to the salaries of higher management, some of it on shiny buildings, some of it goes to subsidise research (which would make sense if courses contained a high proportion of the findings of the individual lecturers and faculty, but they don’t, certainly at undergraduate level).

    I think higher ed needs a new business (or non-business) model – but it’s unlikely to eveolve from within the centre without a lot of pushing, as there are too many vested interests.

  6. Ad 6

    Coming from a generation who got out with multiple degrees, stuff all debt, subsidized student flat, strong student union services, and a generous approach to non-commercialized research, I think Labour could do worse than a feint to gather it’s previously solid academia voter support.

    Not sure i’d start with debt, though.

    I’d start with aiming to make our universities higher in world rankings to keep our best minds here, more adept at commercialisation, and more engaging in society’s major debates. I.e. before lowering student costs, generate better support for the idea of university itself. Says an old trougher.

    • Rich 6.1

      The “world rankings” are egregious rubbish. They’re mainly driven by marketing and publication activities targeted at driving a university up the rankings (which can often be as simple as ensuring that someone given a “list your top 10 universities” questionnaire puts Knowledge College on it, possibly because Knowledge College has ads on every bus stop, or a top 10 football team, or sends out lots of fairly bogus “top scientists have discovered…” press releases*)

      * All of which employs many people, paid for out of student fees – see my various comments above.

      • Ad 6.1.1

        Rankings are not rubbish to any parent in the world with a cheque book, or most employers, or post-doc scolarship awarders.

        Regardless, like the Future of Work stuff, Labour needs to do more than make agreeable policy harrumphs if it wants fresh votes.

        • Draco T Bastard 6.1.1.1

          Rankings are not rubbish to any parent in the world with a cheque book, or most employers, or post-doc scolarship awarders the ignorant.

          FTFY

          • Craig H 6.1.1.1.1

            That’s completely true, but if the perception is different, no amount of saying otherwise will get any traction with the chequebook holder, more’s the pity.

            That said, making tertiary education free and funding the places properly will probably see them going up the rankings anyway.

    • Draco T Bastard 6.2

      The two places I’d start are getting rid of school fees and student loans and then I’d have the government increase spending to at least 5% of GDP. Make it so that we get educated people and we have jobs for them when they finish their degrees.

  7. But as an end-goal I’m in favour of free tertiary education.

    Aren’t we all. You and I both benefited from university study fees of a couple of hundred bucks a year, but the ability to fund that was based on university study being for small numbers of people, mostly the children of the middle class and the elite. What’s the basis for funding free open-slather tertiary ed?

    • Draco T Bastard 7.1

      The fact that mundane jobs are going away and that we need a huge amount of R&D to keep developing our economy/society.

  8. Lanthanide 8

    Yes, society as a whole does benefit, that’s why we have heavily subsidised education in the first place, as well as interest-free student loans.

    IMO the balance is about right, but I think some extra incentives to stay in NZ would be a good idea, as outlined in 3.2 and 3.2.1

  9. Colonial Viper 9

    Universities are no longer meeting the current or future needs of the nation, in terms of providing answers and insights to the issues facing NZ.

    A university education in many instances comes out looking like a waste of time, effort and money. Labour can promise more training and education, but where will these young people go after that? Does Labour also believe in creating suitable jobs for these tertiary educated individuals to go into?

    Universities keep churning out graduates steeped in orthodox finance and neoclassical economics.

    • greywarshark 9.1

      Getting to be meat grinder stuff coming out. We are the meat to be ground. Lawyers, bean counters and magic bean prestidigitators.
      “”Law grinds the poor, and rich men rule the law.” – Oliver Goldsmith “

      • Colonial Viper 9.1.1

        Once upon a time universities prided themselves on conducting and mentoring critical thinking and developing social consciousness.

        They’re mainly just degree mills now. $$$ for bums on seats.

    • Te Reo Putake 9.2

      “Does Labour also believe in creating suitable jobs for these tertiary educated individuals to go into?”

      Robertson / Labour on the future of work

  10. greywarshark 10

    The interest on student loans compounding has made the debt seem larger than reality. Good for government to make clucking noises about irresponsibility, but unreasonable when people are likely to receive lower pay than expected if employed,while consumer prices over all sectors, rise beyond any wage rises.

    The latest problem is of a Cook Islands man being in trouble.
    He’s also reported as saying that, due to a $30,000 salary, a $300,000 mortgage debt and having five daughters, repaying the loan will be a struggle (RNZ is reporting that Mr Puna had a $40,000 student loan when he left New Zealand, which has since ballooned to $130,000 due to interest).

    Here’s a NBR report along with a free picture of someone in the rock star economy a Mr McClay (who has very white teeth, to go with his spotless suit (record?).
    http://www.nbr.co.nz/article/student-loan-defaulter-arrested-new-zealand-border-183864
    There are clearly issues with the scheme if an overwhelming majority of the participants are non-compliant and the government needs to look at this before enforcing this draconian measure,” Ms Harris said.
    “There are two main enquiries to the NZUSA office on this issue, the first is from borrowers who are faced with compulsory fixed amount repayments based on the size of their loans instead of their income, and which they find unaffordable.
    “The second is from parents of overseas-based borrowers who fear they will never see their children again. This does nothing for either of those concerns.”
    It’s the first time Inland Revenue has used its powers to arrest at the border after new laws were introduced in 2014, but says it only uses this measure as a very last resort….

    One News | NZN
    A man arrested this week for trying to fly to the Cook Islands for not paying his student loan is the nephew of the Cook Islands Prime Minister.
    This man was arrested after trying to fly back to Cook Islands for not paying his student loan.
    ‘It’s the worst experience of my life” he told ONE News.

    Nga Puna paid $5000 in the Manukau District Court today and was handed back his passport, when he appeared.
    Speaking to ONE News afterwards, Mr Puna said his initial loan was $40,000 but it ballooned to more $120,000 after he didn’t make repayments.
    Mr Puna is the father of five daughters and is now allowed to return to the Cook Islands, which he will be doing tomorrow.
    He was in New Zealand attending a conference on teaching maths.

    The New Zealand Union of Students’ Associations is worried that his arrest will turn those who are overseas into “permanent refugees”.
    NZUSA spokeswoman Laura Harris said the arrest does little to encourage further compliance with the student loan scheme…
    There are 111,392 New Zealanders abroad – most of whom are in Australia – who currently owe money on their student loans, which amount to around $3.2 billion or 22 per cent of the total loan balance.
    Around 70 per cent (78,399) are defaulting on their loans and owe $839.2 million.

  11. The Real Matthew 11

    Has any costing been provided for with regards to this policy?

    Any details as to how a Labour led government would pay for this policy?

    • Crashcart 11.1

      Have you read any of the rest of this thread to see the many discussions going on about this or did you only drop in to test the sound bites we will be seeing from right wing pollies shortly.

    • indiana 11.2

      Its not a policy, its a potential PROPOSAL, an offer that COULD be reneged on, but for now sounds like something that MAY attract voters. If it doesn’t attract voters – it will be shelved. They’ve looked at what other countries have done that they THINK are LIKELY to work here.

      • Pat 11.2.1

        ‘They’ve looked at what other countries have done that they THINK are LIKELY to work here’

        to be fair , they have no need to look to other countries, nor reinvent the wheel….they could simply revert to the system we had before.

  12. millsy 12

    I think Labour needs to realise that there are bigger problems in the tertiary education sector than fee levels.

    There is little point to reducing fees while keeping the whole system basically in the same privatised, corporate, neo-liberal form it has been for the past 25-odd years.

    International students, quality of teaching, facilities for students, whether unis/polytechs are teaching the appropriate courses, or whether some courses should be replace with on the job training, the unit standards system, master learning, attitude of universties towards the students, and the level of private involvement in the sector.

    Those issues need to be considered as well as fees, which pale in insignificance to the cost of text books, materials etc.

  13. Wainwright 13

    Still waiting for anyone from Labour to come up with actual ideas. Getting bored of this “not ruling out anything but promise it’ll be jam tomorrow” merrygoround.

  14. Michael 14

    A “few minor details” not addressed is Hipkins’ latest propaganda grab: 1. How much does Labour intend to reduce tertiary education feesin its first term of office? 2. In what year of that term will student pay reduced fees? 3.How much will this policy cost, in that first term? 4. Will Labour cut the funding of tertiary education providers by reducing student fees, or will it top up the difference between the fees received and current funding levels? 5. If the answer to question 4 is in the affirmative, how will that increased funding be met: increased taxation; spending cuts from elsewhere; borrowing from financial markets? Without these details, Labour’s announcement is pure bullshit and should not be believed.

    • Craig H 14.1

      Labour’s tertiary education policy hasn’t been finalised, so it’s hardly a surprise that costings and details weren’t released. Policy details will roll out closer to the next election.

      • Michael 14.1.1

        So then we shouldn’t take any notice of Hipkins’ grandstanding until we see the details. We’ve been burned by Labour propaganda in the past.

        • Craig H 14.1.1.1

          For any given topic, until the policy rolls out, all Labour MP speechifying is propaganda.

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