Universities seek any extra money

Scarce tertiary education dollars should be invested in universities, not individual students who already receive four times the OECD average in financial support, vice-chancellors say.

However, students, who are lobbying for a universal student allowance, say much of that support is in the form of loans for fees that go direct to institutions rather than students.

An Organisation for Economic Co-operation and Development (OECD) report, Education at a Glance 2008, shows that in 2005 student subsidies accounted for 42 per cent of the Government's spending on tertiary education.

This put New Zealand second highest of all OECD countries and well above the OECD average of 18%.

New Zealand Vice-chancellors' Committee chairman Professor Roger Field said universities needed more public investment, while provision of student support was "more than adequate". "For New Zealand universities, the underlying issue is the balance between quality and affordability," he said. "If the pendulum swings too far one way, university education will be affordable for students but the quality of that education will be compromised."

The Press reported in July that Labour might use a universal student allowance as an election pledge. Its decision to introduce interest-free student loans in the 2005 election campaign was credited with turning the party's polling around.

Field said there was some concern among vice-chancellors that during the election campaign decisions "not in the best long-term interests of university education and its quality in New Zealand" might be made.

New Zealand Union of Students' Associations co-president Paul Falloon said taking into account that fees borrowed through the student loan scheme were paid direct to providers, the proportion spent supporting students fell to 23%.

The idea of a universal student allowance was valid, despite the Government already subsidising students at a higher rate than other countries, as several countries had no fees.

Student debt was driving graduates overseas, resulting in a nationwide skills shortage, he said.

Graduates who went into low-paid jobs were being unfairly treated, as the threshold for paying back a student loan was low at $18,000. That meant they were paying for their degrees, but not benefiting from them, he said.

Canterbury University student Sam Mossman said a universal student allowance would be a vote winner for students.

The current system, which assessed eligibility for allowances on parental income, was unfair, he said.

"It's our parents' choice how much they support us. Just because they earn over a certain amount, they aren't automatically going to pay for university," he said.

Ministry of Education manager of tertiary sector performance Roger Smyth said new figures showed that New Zealand university students paid just one-fifth of the cost of their tertiary education. It was believed for some time that they met 30% of the cost, but allowing for subsidised student loans, the average contribution was 21%.

Education at a Glance found that New Zealand's tertiary qualification completion rates were the third-lowest of 19 OECD countries, with 45% of tertiary education entrants leaving without a qualification, compared with an average of 31%.

Smyth said this figure was heavily influenced by the fact New Zealand had the highest proportion of part-time students in the OECD. They tended not to complete courses more often.

- © Fairfax NZ News