The 2017 Higher Ed Budget: what you need to know
The Australian Government has announced a number of reforms to the higher education sector which will impact both universities and students.
Amendments to the Higher Education Support Act, introduced to Parliament on 11 May 2017, aim to deliver value for money for taxpayers by increasing transparency, sustainability and support for students.
If passed, the proposed changes will cut higher education funding by approximately $2.8 billion over the next four years, and will have a significant impact on student fees and loan repayments.
What will change for universities?
- Decrease in Commonwealth Grants Scheme (CGS) funding. The Government will apply a 2.5% efficiency dividend to CGS funding in 2018 and 2019.
- Performance based funding for Unis. 7.5% of a university’s CGS funding will be tied to meeting performance requirements. Measures will include data collection and reporting, student attrition, completion rates and student satisfaction levels. Unused funding will be re-distributed among remaining higher education providers.
- Support for work experience. The Government will provide subsidies for work experience in industry units, where providers are involved in delivery and assessment.
- Increase in funding for low socio-economic status (SES) student places. The Higher Education Participation and Partnerships Program funding delivery will be revised with a loading for each low SES student.
- Loadings for Dentistry and Veterinary Sciences places. The existing medical loading will be extended to include Dentistry and Veterinary Sciences units of study.
What will change for students?
- Increase in fees. Fees for students in Commonwealth Supported places will increase by 1.8% each year from 2018 to 2021, while the Government reduces their contributions by the same amount.
- Changes to HELP debt repayments. From 1 July 2018, changes will apply to the timing and amount of repayments for new and existing HELP loans.
- The minimum repayment salary will drop from $55,874 to $41,999
- New loan repayment rates
- Repayment thresholds will be indexed to the Consumer Price Index from 1 July 2019 rather than Average Weekly Earnings.
- Loans to replace subsidies for New Zealand citizens and Australian permanent residents. Most permanent residents and NZ citizens commencing study from 1 January 2018 will no longer be able to access a subsided place, making them full fee-paying students. They will be able to access an income contingent student loan.
The amendments have been referred to the Senate Standing Committee on Education and Employment, which is expected to report in August 2017.