Background and policy interpretation
There were several changes related to higher education that were announced in Australian Federal Budget 2013-14: including $2.37 billion cut in universities funding, the proposal of conversion of Student Start-up Scholarships into income contingent loans, the end of up-front or voluntary payments of HECS-HELP debt benefit (Australian Associated Press Pty Limited, 2013).
Higher Education Contribution Scheme (HECS), which was introduced in 1989, replaced the previous no-fee approach by an income-contingent approach. The financing of higher education of the previous no-fee approach was from the general tax revenue, while the HECS system is charged based on the actual income if it is higher than a certain threshold. A significant modification has been made in 1997, and the HECS system became less generous to students.
Start-up Scholarship is a study-support program provided by Centrelink. The eligibility is based on the residency status, courses enrolled, etc. If the proposal is passed, the eligible students will not receive it, instead they will be given a loan, which repayment requirements and method are similar to HECS.
Review of Chapman and Ryan’s research
Chapman and Ryan (2005) suggest that the introduction and modification led to a more equal wealth distribution of universities participation. The increase of male’s participation rate was more steady, while the females at middle levels of the wealth distribution had a significant rise.
According to the Gini coefficients which was estimated by Chapman and Ryan (2005), the introduction of HECS reduced the equality of participation, whereas the inequality has been eliminated and largely improved after the modification of HECS in 1997.
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...rsity place is limited. The increase of admission of international students will lead to the increase of requirements of domestic admission (ie, ATAR), thereby crowding out domestic students. This situation has already happened, especially in some migration-compatible programs.
Conclusion
The 2013 budget cut the university funding and it has proposed that the Start-up Scholarship will be converted to income-contingent loan. Both of the policy changes may affect university participation. However, according to past research, we can expect there would be only a moderate change or even no change in the rate. Compared with the direct influence of the budget, it is highly probable that universities may choose to admit more international students in order to overcome the funding shortage problem, which may have a more severe impact on the universities participation rate.
introduction of Commonwealth scholarships for secondary schools as means of introducing State Aid to all schools
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Johnstone, Bruce. "Investing more equitably and efficiently in higher education, creating value for America." National Dialogue on Student Financial Aid (2003): 6-10. Print.
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“Student Financial Aid in Finland.” Ministry of Education and Culture. Ministry of Education and Culture, n.d. Web. 2 Oct. 2013. .
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