The higher education reforms will give parents and students more options

John Dawkins must be smiling. When he introduced the HECS system in 1989, the federal Labor education minister was confronted by demonstrators carrying coffins symbolising the "death" of higher education. Fourteen years later the sector has doubled in size, and with it the proportion of Australians with a university qualification.

The placards have been dusted off as protesters again attack changes essential to the future of a diverse, internationally competitive higher education sector.

Australia's 38 publicly funded universities are on a collision course with mediocrity. The case for reform rests on two incontrovertible truths. The first is that universities need access in the longer term to more money. The second is that money is only half the problem.

The Howard government's reform package delivers on both. At its heart is $1.5 billion in new money for our universities - $10.6 billion over the next 10 years.

Though governance reform, more funding for regional campuses, increased university places, living scholarships for students, major increased resourcing for quality teaching and four new centres of excellence comprise the bulk of the package, debate has focused on student contributions.

The university leadership argued for fee flexibility. This will create not a two-tiered but a 38-tiered system.

Labor's education spokeswoman, Jenny Macklin, has told families that their children will not be able to afford to attend university. Parents, she claims, must start saving while their children are babies. This is outrageous behaviour on her part.

The facts are these. HECS remains. This is the interest-free loan scheme introduced by John Dawkins. Graduates, instead of beginning to pay back at $24,365, will not have to pay back their contribution until earning $30,000. Instead of universities being locked into charging students one of the three HECS rates according to their courses, they will set their own HECS charge from zero to an upper limit in four ranges.

Some universities have said their fees won't change. Some have said they will lower their fees in some courses. The 7 per cent of students training as doctors, dentists, vets or lawyers face potentially the largest increases, but the most their HECS contribution could possibly increase by is $2000 a year - paid back only when working in their mostly highly paid careers.

At the same time the package ensures those training as teachers and nurses (14 per cent of students) will pay not a cent more in HECS.

Students will have greater choice and be able to make informed decisions about which course and institution will offer them the best value for money.

The option of paying HECS upfront exists (as it always has). Contrary to the claims by those running the scare campaign, it remains just that - an option.

It's important to remember that, even after these changes wash through the universities, students will contribute only just over a quarter of the cost of their education. The remaining three-quarters is contributed by taxpayers - many of whom have never seen inside a university.

The other aspect of the package that has been the subject of a scare campaign, is the opportunity that is provided to those universities that want to increase the number of full-fee-paying places offered to Australians.

Labor claims these places are at the expense of HECS places. Nothing could be further from the truth. The package provides for 31,500 new HECS places over the next five years. This includes the conversion of 25,000 marginally funded over-enrolments to fully funded HECS places at a cost of $347 million. Over-enrolled students in universities are only partially funded by the Commonwealth and have contributed to overcrowding. About 6500 additional places will be provided to the sector for nurses, teachers, doctors and to support population growth.

There are about 530,000 Australian undergraduate students in our universities. About 9400 of them are paying their own way without assistance from the taxpayer, the so-called "full-fee payers". That's about 2 per cent of students.

Labor wants these 9400 young people thrown off campus. That would not create one additional HECS place because these 9400 do not fill HECS places. It would simply mean 9400 fewer people in university.

The reforms propose that universities may choose to offer more full-fee-paying places - but no institution will be permitted to have more fee-paying students than it does HECS students, and any fee-paying places are in addition to HECS places, not in place of them.

Labor claims "full-fee payers" shouldn't be allowed in because their marks are below the HECS cut-off score. This is a ridiculous argument.

A young woman at Frankston High School may have her heart set on studying law at Melbourne University. She works extremely hard and receives a VCE score of 99.3. The kid in front of her at school gets 99.4 and gets a HECS place. Is she dumb? No. Is she rich? No.

This reverse elitism says that the merit-based allocation of HECS places should deny opportunities to Australians who want to pay their own way, while we welcome fee-paying students from overseas. Get real.

The government is now prepared to lend the young woman from Frankston money to allow her to do law.

There are only about 270 Australian undergraduate students in the whole country who face fees of $100,000 or more in fields such as dentistry, law and veterinary science in 16 of the 784 courses on offer. It is unfair that those from poorer families cannot at present even get started in those courses.

All fee-paying students will now have access to a $50,000 loan, with a 3.5 per cent interest rate, which they do not begin paying back until they are earning more than $30,000.

This package effectively abolishes fees at the university gate by making student union membership voluntary and offering loans to bright kids who missed out on a HECS place but want to take up a fee-paying place.

Reform is not easy, but its critics should stick to the facts.