The Unchained University

Australia's universities are chained down by outdated, inconsistent and often crippling legislation. This monograph is a comprehensive book-length argument for a market-based higher education system in Australia. The universities' problems are largely the creation of policy, which means it is not difficult to find reforms that could produce significant improvements in relatively short periods of time. Two of the four university funding models put forward in Education Minister Dr Brendan Nelson's higher education finance discussion paper propose a market system, with student places allocated according to demand, and prices set by universities. The reasons for making this change, and the likely consequences, are dealt with only sketchily in government documents. This book expands on the benefits of a market based system to higher education and argues that a demand-driven system in which prices were set by universities would mean fewer students missing out on their preferred courses, improved quality of undergraduate education, and the end of universities' chronic financial problems. There is, however, a powerful coalition of interest groups opposing change- from student unionists to Vice Chancellors-most of whom also hold deep ideological positions on higher education. They fear that market reforms would have a negative effect on access and equity, on 'traditional' disciplines such as the Arts and Sciences, and rural and regional universities. Unless their objections are dealt with, getting political acceptance for reform will be difficult. This book addresses anti-market arguments and outlines the failure of the current central planning model and the benefits of an alternative funding model in which universities decide how many students they will take and what fees they will charge. The government's role will be offering discipline-specific subsidies and income-contingent loans to pay fees. The various objections to higher education markets are explained, and shown to be wrong or over-stated.