Degrees of difficulty increasing

STUDENTS of the future will struggle to cope as budget moves mean university fees and loan costs are set to rise.

University students Madeleine Chapman, left, and Zilla Gillies-Plates say enrolling this year is the difference between struggling for a degree and not being able to afford one at all. Picture: James Croucher

FIRST-year university students Zilla Gillies-Plate and Madeleine Chapman say they would not have been able to afford their degrees had they enrolled when higher education reforms are set to begin in 2016. But they can continue their degrees under existing arrangements or, if they take longer, until 2020, when the new system will apply to every student.

Although the funding changes do not happen for another two years, anyone who started a degree from May 14 will be affected.

Paying the interest bill is another matter, however. “We are both students who live out of home and already we have to struggle with bills, rent, transport, textbooks and we know we have this looming HECS. I don’t think we would be able to afford to go university had we signed up next year,” says Gillies-Plate, 19, who studies law and arts at Sydney’s Macquarie University.

“I think the action of the government is deterring future doctors, future nurses and future teachers, because they won’t be able to afford HECS fees. I’m sure this won’t affect those that are wealthy.”

The friends live together in Sydney’s inner west, where they work part time in hospitality and customer service roles, earning about $400 each a week.

International and global studies student Chapman, also 19, says although they are financially independent and study full time, the pair are ineligible for any government assistance as they are too young and their parents’ incomes are too high.

“Even though we live on our own, we support ourselves, we already don’t get any help for the government,” she says.

“We’re not even from a low socio­economic background: if we were enrolling in two years, we wouldn’t be able to afford to go to university. I think I would pick a degree based on price instead of something I wanted to do, something more in my reach, and that is a really sad idea.”

Chapman’s degree at the University of Sydney currently costs about $35,000 but the federal government deregulated prices and will allow universities to charge what they like, based on demand. The cost of some degrees could skyrocket, such as law at Sydney University, while others could feasibly fall.

It wouldn’t just change the degree she chose to study but it would influence her post-graduation employment decisions, says Chapman. “I would have to pay that back at some point so I don’t think I would get in to teaching or social work, which might be fulfilling, because I couldn’t as easily pay back the debt.”

Currently, Macquarie University charges $48,000 for Gillies-Plate’s degree.

The government has collapsed its support clusters from eight to five. Government contributions for degrees such as law will fall by a small amount — from $1951 a student to $1805 — while for engineering the drop will be from $16,762 a student to $12,045. The FEE-HELP loan limit will be removed and former students will repay the debt once they earn $50,638 from 2016-17, down from $56,264.

Higher education providers will be required to provide $1 in every $5 of additional revenue to a dedicated commonwealth scholarship scheme for students who would otherwise struggle to gain access to university.

All students, regardless of when they started their degrees, will have to pay compound interest on their degree debts from June 2016, tied to the 10-year Treasury bond rate and capped at an annual rate of 6 per cent.

Additional reporting: Rick Morton