Levy is “just one of 70 ideas”, Aus ed minister says

Published 31/10/2023

Australia’s education minister has urged the sector to consider how the reform of higher education in the country will be funded, as stakeholders continue to oppose the idea of an international student levy.

Speaking on ABC Afternoon Briefing, Jason Clare said “there’s no magic money tree” for funding reform in the higher education system.

“We’ve got to look at how we do it, and this is just one of the ideas in that report,” he said, referring to a recent Universities Accord interim report. “I described it as a spiky idea,” he said but did not say that it is a proposal set in stone.

“We want this debate to happen. I really want people’s ideas,” he said, adding that the Accord Panel put an echidna on the front page of the paper “for a reason”.

“Tell us what you like. Tell us what you hate. Tell us what ideas in there should be discarded and tell us what ideas aren’t in there that we should be implementing so that we can set up our university system for the next decade and the decade after that,” he said.

The idea, first put forward in the report released in July, was immediately criticised by the Group of Eight, as well as Independent Higher Education Australia, which said that it would damage Australia’s competitiveness against international rivals.

An in-depth Melbourne Centre for the Study of Higher Education analysis released recently criticised a sovereign wealth fund that channels funds from institutions receiving high international student fee income to other providers.

It would both exacerbate negative sentiments among international students that they are seen as “cash cows” and have consequences for equity between higher education institutions, as well as require a number of years to build up a reserve holding enough funds.

The paper also said it would likely have an impact on international demand, with the Victoria University’s Centre of Policy Studies modeling indicating a 5% tax on international student fees at all vocational and higher education providers resulting in a 6.6% drop in international student numbers.

It also highlighted that concerns had come from “unexpected quarters”, including the Property Council of Australia’s Student Accommodation Council which may have come out in support of the levy as the minister had suggested it could be used to fund student housing.

However, the group opposed the levy due to its potential detrimental impact on Australia’s attractiveness.

Vice chancellors at a number of Australian institutions are continuing to unite against the “Robin Hood tax”.

However, The Sydney Morning Herald noted that three universities have publicly backed the proposal for a levy on almost $10 billion in international student revenue, with 31 public universities expressing reservations or rebuffing the idea.

University of Newcastle vice chancellor Alex Zelinsky and University of Technology Sydney vice chancellor Andrew Parfitt first proposed the levy, with James Cook University in North Queensland showing support.

Go8 maintains that the “spiky idea” of a levy should be “rejected in the national interest”.

“It is a redistributive tax that would create countless unintended consequences, damage our higher education sector and international reputation,” the group said.

“We must ensure that this process does not undermine our nation’s hard-won and enduring success in international education and damage Australia’s largest services-based export industry.”

“We strongly oppose such a levy. Such a Robin Hood tax is unlikely to have any positive benefit for the sector as a whole,” Murdoch University in Perth said.

“We can’t fund everything. We can’t do everything”

“Robin Hood was one of the good guys,” Clare said during the ABC interview. “But this is one of about 70 ideas in the Accord Interim Report that I released in July.”

The proposal is one of a number that can help fund reform, the minister continued.

“Over the course of the last few months and between now and Christmas there’s a real debate going on about what are the reforms that we should prioritise. We can’t fund everything. We can’t do everything.

“But I’m asking the Accord Panel to tell us what are the top priorities that we should try to implement now and over the next 10 years and how do we fund them. And this is one of those ideas.”

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