in focus 1 March 2010

In good news for Members and students, amendments to the Higher Education Support Act received royal assent this week. Specifically the amendments will allow higher education and VET providers to lodge their application for approval to offer FEE-HELP and VET FEE-HELP before having their tuition assurance arrangements in place. It is intended that this will allow the two processes to occur simultaneously thus speeding up the approval of providers and access to the loans and reducing the upfront costs for applicants. ACPET raised this matter with Government in 2008 when VET FEE-HELP was introduced and we are pleased that after a long journey through the Parliament it is now a reality.

On the other hand, in what appears to be an ad hoc and arbitrary decision the government has introduced an amendment bill to increase the undergraduate FEE-HELP loan fee from 20% to 25%.

This move will not only penalise students undertaking non-university higher education course but adds to an already incoherent fee regime.

At present, VET FEE-HELP students pay a 20% loan fee while there remain two HELP loans that cost students nothing. OS-HELP, which finances study overseas, has recently had its loan fee abolished and FEE-HELP for postgraduates remains free of any administrative charge. An analysis of the participants in these programs is likely to demonstrate that both programs would attract many students with a greater capacity to pay than those undertaking FEE-HELP courses. Adding to the lack of consistency is the fact that Open Universities Australia escapes the net with no loan fee applied to courses undertaken with OUA.

This arbitrary opportunity to make a budget saving does nothing to increase participation in higher education or encourage non-university institutions to invest in expanding their course offerings.

The answer is for this Bill to be defeated and the loan fee left at 20% pending a thorough review of the significant contribution made by HELP programs to increasing education participation. An appreciation of this contribution will only serve to support a case for lower rather than higher fees.

Full details of the changes to FEE-HELP and VET FEE-HELP application processes can be accessed on the DEEWR website.