Graduate model not the panacea

Even if the bold new plan for the University of Melbourne worked for Melbourne, would it, if more widely applied, work well for Australia?

The graduate model, proposed earlier this month by Melbourne vice-chancellor Glyn Davis, has higher tuition costs and adds a year to the length of study.

There are educational grounds for a more generalised first degree that precedes or blends with specialisation. The skills of Australia's mostly monolingual graduates can be narrow. Our bachelor of arts or bachelor of science is a year short of international equivalents but the four to five-year professional bachelor courses available are well recognised and double bachelor degree students also do well.

Bologna is taking our model to Europe, creating a bachelor exit point and reducing time at study before work-force entry.

Yet Federal Education Minister Brendan Nelson reportedly wants to see more students doing generalist first degrees at outer-suburban and regional campuses before entering professional graduate schools in city sandstones for a fee. He is said to be responsive to the call to remove limits on fee-payer numbers, fee levels (including for HECS students) and caps on FEE-HELP loans.

All this while he expresses concern that too many marginal students are being admitted to university. That reflects perverse volume controls; non-elite institutions losing starters to fee-paying places must meet their quotas from lower quartiles or increase non-standard admissions. As the latter dry up in a strong jobs market, the former have to be found from deeper bores.

Nelson seems to be thinking about reducing the number of HECS-based undergraduate places at research universities and transferring them elsewhere (the aggregate effect on supply of places is unclear).

This centrally managed (though arbitrary) approach is unlikely to work in the policy mess of partial price and volume controls, and different rules for public and private providers. The consequences would be inefficient and unfair, would cut off innovative course development, yet fail to tackle the real problems. Professions are troubled by falling quantity and quality of student demand. The output of domestic professional graduates has been flat for several years, masked by growth in international students.

Earlier acceptance of burnout is not part of the employment contract of new generation professionals, who have different priorities in work-life balances. So the replacement rate of new for old professional, in an ageing society, is greater than one-for-one.

The rapid emergence of global markets for professionals gives rise to poaching. Australia is not well positioned in the worldwide competition for intellectual talent. If more professions required a masters degree as the starting qualification, the additional opportunity costs and higher tuition costs could deter many capable students. The professional skills shortage would worsen.

The approach runs counter to post-1987 developments when postgraduate courses were first opened up to fees for skills upgrading of people in jobs. In 1993 universities were able to offer fee-paying postgraduate courses within their funded load, attracting HECS support, to safeguard opportunities for those who could not pay.

HECS gradually covered only undergraduate students obtaining their first occupational qualification, given the weaker case for taxpayers to fund extra qualifications for employed professionals.