September 26, 2013
Over the last 30 years, Australia has moved from an elite system of higher education to a mass system.
In the process it has also become a demand- driven system under the Gillard Government, which changed the publicly-funded higher education from being supply-dominated to demand-driven. Andrew Norton says:
Under the old funding system, demand and supply were only weakly linked. Potential students could apply to any course in any university. But the supply of places was constrained by government. Universities rationed places within this supply constraint. Typically, they used prior academic performance to decide who received a place. This created a market in which ATAR was the currency and the cut-off mark the price. Students with low ATARs often received no offers.
Since caps on undergraduate student places at public universities were eased and then largely abolished, student numbers have increased rapidly, by as many as 190,000 extra students. With uncapping, the system is lifting the supply of graduates to Australia‟s economy, increasing student choice, and improving access to higher education for disadvantaged groups. Universities start responding to demand trends in science, health and engineering by providing new student places.
Norton argues that it would be a policy tragedy to recap university places, as it would make Australia‟s higher education system less fair, less efficient, and less productive.
Notwithstanding this, the Coalition has opened the door to intervening in the demand-driven system of university funding by re-introducing caps on university places. The reason is the link to a perceived slip in university quality---Quality is suffering to achieve quantity according to Christopher Pyne, the new Federal Education Minister.
Standards and quality have been compromised by all these new students. A re-capping of the system would bring these numbers back down again. Universities ration places by prior academic ability. Fewer places mean fewer lower-ATAR students. Capping the system, which would provide more per student funding for those left behind, would be a case of robbing from the academically poor to give to the academically rich.