Following the removal of the university fee cap a few months ago, the Turnbull government is now pushing to hike up the prices of university fees by 7.5 per cent. This is due to the result of Turnbull’s new higher education package which would additionally force the payment threshold to begin when debtors started earning at least $42,000 annually as opposed to the original $54,869 annually.
So what will this mean for students like us?
With scholarships to universities being extremely limited and selective, most of us will have to carry the burden upon ourselves, whether it be help from a close family member or friend, or a liquidisation of assets in order to payoff this debt, we’ll all have to sacrifice something of value. And with the government lowering the limit of income before payoff of debt is compulsory, many of us will find ourselves having to suffice at a poorer living standard upon entering the work force.
So why does the government hold such distaste for education?
As much as it may seem like the government is subjectively crushing your dreams of becoming a lawyer or doctor, their actions are generally for the best interest of society. I may not have sufficient data to determine the exact reason for why the government would provoke the younger population but through general economic theories we can create a general idea of why. Firstly, conventionally speaking, the government is only cutting funding for university students which is payed by taxpayer dollars. Generally, this would indicate the government is reallocating resources to maximise benefits for society. Funding cut from the education sector could easily be placed into public transport, welfare or any other sector that is in need for money. For this reason, it’s assumed the amount of university educated individuals has reached an excess in which a skill shortage in labour work such as trades are needed. Moreover, with the general trend of university graduates holding degrees but working in fields that don’t require them (e.g. fast food, retail) can be regarded as an ineffficient allocation of resources in which the Turnbull government aims to fix.
So what could go wrong?
The disadvantages of employing such policies is that it’s effects aren’t apparent until years later on. This would be disastrous when the issue of educated industries becoming short on labour becomes apparent. The government would then have to immigrate foreign workers to fill this skill gap until the Australian labour force becomes skilled again. On the contrast, the benefits if the government were to properly reallocate resources could see Australia’s economy to prosper and flourish, but that’s just wishful thinking.