Federal government to target dud university degrees

By Leith van Onselen

With HELP bad debts currently standing at around $50 billion, the federal Education Department will work with the Australian Taxation Office (ATO) on matching tertiary courses with income and employment outcomes. The stated intent is for this information to help assist prospective students with course choices. However, Andrew Norton of the Grattan Institute says this information could also be used by the federal government to make it harder for students to access the Higher Education Loan Program for courses that have poor employment prospects. From The AFR:

Mr Norton said much of the government’s focus had been the risk of non-payment in the vocational education and training sector. Here courses are cheaper, but debt quickly mounted when the previous Labor government extended income-contingent HELP loans to the sector…

The government might be inclined to extend that thinking to higher education, especially if the ATO analysis provided empirical evidence about the riskiest borrowers, Mr Norton said.

“There are some higher education disciplines, especially the humanities and creative arts, that on other data sources look like they will have high bad debt,” he said…

The overall student loan debt owed to the government has grown rapidly from $25.5 billion in 2011-12 to about $50 billion now, prompting concerns about its long-term viability…

“Taxpayers are currently footing a bill of around $50 billion in student loans and unless something changes, we’ll have to write off around a quarter of that debt,” [Education Minister] Senator Birmingham said in a statement…

Enabling students to ascertain whether an area of study is likely to lead to meaningful employment is worthwhile. It’s also useful information for the government, so that it can reduce funding to spurious courses with little employment prospects, just as it has done in the private vocational education and training (VET) space.

That said, a bigger issue that needs reform is the demand-driven university system. For mine, this uncapping of university places is the greatest policy blunder and the biggest driver of the current problems afflicting Australia’s university system. It has facilitated a form of ‘quantitative easing’, whereby the universities have lowered entrance scores and printed as many degrees as possible to accumulate Commonwealth government funding through HELP/HECS loans, as well as sell as many degrees as possible to foreign students.

The end result is that the universities have flooded the market with so many graduates that a university degree has lost its value, despite the significant cost to both students and the Budget.

Given the abject failures of the demand-driven system, I believe that policy should first and foremost look to restrict federal funding and adopt a merit-based system that rations the number of university places based on a detailed assessment of the economy’s needs.

[email protected]


  1. Are you saying courses in queer woman’s dance therapy generally don’t pay well post graduation? What about demand for feminist glaciologists?

    • Cannot happen fast enough! All Affirmative Action courses (within arts courses and now embedded within most courses) need urgent revision because they are preventing free-speech and preventing professionals from speaking out for fear of discrimination laws.

    • Once we decolonise the sciences we can move on against the oppressive patriarchy :p

      Could help explain the 77c pay gap myth rising up repeatedly like a zombie, when you have a gndered diverse view of how statistics and averages work.

  2. it’s a good start, but the usual suspect degrees (the humanities) will be necessarily unfairly targeted. the govt also needs to take out business degrees and most science degrees (did you know that STEM students have some of the worst outcomes?). the whole idea of the ‘generalist’ college degree needs to die and replaced by workplace apprenticeships. employers dont want these anymore and they are of very limited value.

    picking on philosophy/history majors is easy and fun, but look at these crappy outcomes for ‘science’ guys (in the u.s, at least): https://pbs.twimg.com/media/DN1tW5tVwAA307o.jpg:

    at least being a communications major bimbo has some marketable value, the f__ use is a physics degree for any employer?

    • >… the f__ use is a physics degree for any employer?

      Calculate the wave length of a resonant static wave on a multi-media (silicone, rubber, glass core) dildo…

      Aaaannnd…. go!

    • “college degree needs to die and replaced by workplace apprenticeships”
      Given the massive collapse in qualified trades people in Australia since all the government industries formerly responsible for training most apprentices got privatised, Employers other than the government clearly aren’t interested in workplace apprenticeships either. They just expect fully qualified fully experienced staff to appear in a puff of blue smoke.

      • Yeah – and didn’t hear that we’re a services economy now? Apprenticeships for what? Them baristas and real-estate agents don’t need no apprenticeships – 3 days ‘course’ and you’re ready to go!

      • “They just expect fully qualified fully experienced staff to appear in a puff of blue smoke.”

        and in all sincerity their expectations are usually met – its called skilled visas!

      • They import 457s at way below the local rates. The only thing that goes in this economy is rent-seeking and cost arbitrage. Forget creating value. The next economic down turn will be a humdinger as all the temporary visa holders will be rapidly shed from the ‘FIRE’ sector.

    • Replacing degrees with TAFE qualifications or apprenticeships won’t do much other than change the labels on those graphs.

      The problem is a lack of jobs.

      • that too, but if there’s a lack of jobs the number of uni placements should be curtailed corresponding. that is cruel AF, sending kids off to unis (an extension of the juvenile prison complex that is ‘education’) to prepare them for work that doesnt exist. just give them their HECS money so they can buy cars and go on international trips, at least that would be fun.

      • There are jobs and some people are destined to work in retail for life. But the Greens love giving out work visas for $0 each.

        I visited a business recently and the 2 receptionists had 3rd world accents. I wonder what wages they are on. Go to a similar business in Taiwan or Japan and the receptionist will have a Taiwanese or Japanese accent.

        40% of MEL and SYD are foreign born! That is enough globalism is it not.

      • Jumping jack flash

        They seem to have gone the other way, expecting degrees to fill the gap after the destruction of TAFE.

        Now they’re whinging that degrees are too academic and “researchy” for practicality.
        “Practicality” was the whole idea of TAFE.

        In my opinion many degrees that are on offer these days should never have been degrees: Most of IT, teaching, nursing, paramedical, most of engineering, should have been kept at TAFE rather than pushed over to universities to try and teach practicality, rather than research.

        Next they’ll be saying that degrees aren’t academic and researchy enough, and we’re not innovating enough in our universities because we’re too busy instilling practical skills in uni students.

        Its turning into a dog’s breakfast and someone has to draw a line and set some standards.

  3. NSW Uni recently said it “is acutely aware that graduates want a job”! Wow! What were they thinking until now? That we want to be destitute?

    • I think they misread that last word for a very long while now. It’s only recently they went: “Oh, you meant ‘destitute’… we read that as ‘prostitute’ for years. Whooopsie! “

    • Yep they are absolutely out of touch, f_cks who all deserve to be shut down. they can cycle between “we’re LEARNING INSTITUTIONS, WE’RE NOT SUPPOSED TO PREPARE YOU FOR WORK” and “COME STUDY WITH US, WE HAVE THE BEST WORK OUTCOMES” when they’re either defending themselves from criticism their curricula is useless or trying to get students to hand over money to study with them. serious scum.

      uni degrees now need to have guaranteed work placements, at least 3, or else they are worse than trash.

      • Seriously excellent idea and may I add (seriously) that their final year should be done concurrently with their employer AND the university. This way Australia can reduce the number of 457 because the students whilst studying (unqualified) become a cheaper source of employment for the employer. This program is similar to most Medicine studies. We need to review/eradicate the excess amount of humanity courses (via Arts facilities) that foster a rescuer-mentality (semi Government employment) which is deliberately turning people into dependent-snowflakes or in may cases preventing them from helping themselves; currently costing taxpayers zillions.

      • science is arguably if not worse these days. dont just pick on the humanities. business, science, ‘commerce’, its all gotta go. send it to the trash can where it belong.

      • They need to go back to having universities and institutes of technology. They renamed them all for marketing to foreign students (the logic is that foreign students will pay more for a uni qualification than an insitute qualification, MIT notwithstanding).

        It used be that unis taught you why and institutes of technology taught you how. Places like the old QIT and RMIT were in the centre of town so that workers could quickly get to part time classes. And employers knew that a medical technologist graduating from QIT was job-ready (and may even had been working in that discipline whilst they studied). If you wanted a job in medical technology or law or accounting or engineering you knew that in some ways it was an advantage to go to an institute rather than a uni.

        My impression is that these days the old institutes see themselves as universities and are competing in the same niches as traditional unis have been in for yonks.

  4. But Dud university degrees a major export!

    There will be loads of unhappy Chinese students if they find out their degrees are not worth what they paid for them. They are already getting restless at University of Sydney:

    International students win power in USyd election
    ‘Panda Warriors’ won and had eight candidates elected to the Student Representative Council at elections.
    Panda Warriors are demand:
    – Multi-lingual support for housing, academic, and tenancy.
    – Concession fares on public transport
    – Discounted fees for International students

  5. mine-otour in a china shop

    Matching employment with outcomes is a good idea as long as University “marketing and press” departments are not allowed to do the analysis and put a spin on it.

    Charles Sturt University claims to have high employment outcomes and salaries for their graduates but I’d suggest this data includes those people already in employment before starting their degrees, typically mostly learning by distance mature students.

    Any analysis must be carried out independently, using the same methodology and gives a breakdown of outcomes for undergrads only entering the next stage of their education and not already in employment.

    • i go to CSU and yes that is the reason, most students therer are online students like me (tho i have no job)

  6. Aussie graduates will get jobs if mass low-wage immigration is slashed.

    PM May’s crackdown on mass low-wage immigration means it is easier for Britons to get skilled and unskilled jobs:


    She is a bigger hero for native workers than the so-called Labor Party of Australia.

    Even Trump is a bigger hero than the ALP because farms in USA are finding it hard to get staff to work for $5/hour.

    • Indeed.
      Uni folks cannot wait to get those low paid jobs (like avo or banana picking) as a stepping stone to that dream job at Australian Aeronautical and Space Agency.

      • I said skilled and unskilled.

        She kicks out foreign students within 6 months of them completing their “degree” unless the graduate gets a high paying job.

        The ALP gives out Aussie passports for doing a dumbed down “degree” – even if the graduate is working in retail for barely legal wages.

        Where do you reside?

        Take a look around you. Delivery trucks and vans being driven by 3rd world males. Retail work being done by 3rd world passports. Even the government funded NBN gives entry level jobs to 3rd world passports!

  7. Ironic – the ad that appeared while I was reading this was “Our Master of Marketing opens doors to a range of opportunities” Griffith University.

  8. The FG doesn’t need to target useless degrees – it just needs to stop funding them and let individuals do a cost/benefit analysis. FG interference has broken the market and massively inflated the prices and inefficiencies. More FG interference is not the answer – 500 people cannot pre-empt the decisions and requirements of 20 million people.

  9. Jumping jack flash

    Step 1: Revitalise TAFE. Spend some serious money.

    Step 2: Push 80% of offered degrees that shouldn’t be degrees back to TAFE. To do this, use the yardstick of the traditional university core arms of Arts and Science. Maybe keep medicine separate too, as Medical “Science”.
    Everything else is handed to TAFE to teach practical, business-ready skills.
    The Ba. Herbs, is now a TAFE certificate course, not a degree.

    Keep universities as centres for pure research, development and innovation.
    This would also, simultaneously, take care of the problems of watered-down degrees, university funding and university placements.

    Effectively it would push the problems onto TAFE, but that is where the problems should be. If there are too many certificate IV web developers, then who cares because that’s not a traditionally exclusive thing like a degree. And those who have a degree are all about finding new encryption algorithms and secure communication protocols rather than making webpages.

    I’m fairly sure that this was the direction that was envisaged when TAFE was created, however since funding was slashed to universities, and TAFE was all but shut down, universities have been forced to throw open their doors to any man and their dog who wants to “learn stuff”, repositioning themselves to try and teach practical skills AND research, development and innovation, all in the space of a 4-year degree, and in my opinion, this isn’t working and both academia and practicality will lose out.

  10. So much for Turdbull and his inclination to innovation etc. While consecutive governments have overseen this foreign uni supermarket you think he would consider shaking up the whole sector. Nah … its all part of the rigged dumbed down circus that is the Australian economy. Let it burn.

  11. What’s particularly frustrating is that if some of the economic figures I’ve seen on this site are right, we’d be wealthier without the whole exporting of the sector, and that’s before we talk traffic and housing.

  12. I reckon the big improvement to graduate outcomes will come when governments caps the proportion of funding going to central administration (eg marketing, HR, directors of diversity, directors of resilience etc). Then student : academic staff ratio will improve. Student feedback /training will improve. Facilities for students will improve. Heck research output might improve.

  13. What is it that you guys don’t understand?
    Australia has only 8 Universities the rest are all glorified TAFE’s
    Business leaders understand this, Students understand this hence the ridiculous Atars required for G8 universities.
    seems to me it’s you-all that didn’t get the memo. So now you want to create rules and regulations that will ONLY affirm what the market has already decided.
    Why would anyone attempt to regulate what the market decides? Generally speaking the market is far smarter than any individual, and those select few Individuals who are truly smarter than the market get handsomely rewarded by the market for their abilities.
    If you Listen to what the market is telling you you’ll find it’s often exactly the regulation that you’re seeking.
    If there’s an excess of university graduates than the market decides to only take G8 students. Isn’t that also exactly what regulation would achieve?

    • this is complete bullsh1t. the atars at the g08 schools arent “ridiculous”, at most they are about 10+ higher than non go8s depending on the course. the good universities guide includes a bunch of metrics, not just employability. go8 universities don’t do any better on anything besides ‘prestige’.

      • I don’t think I’m saying that the students graduating from tier 2 Unis are all worse than the graduates of G8 schools.
        All I’m saying is that IF there are far too many graduates for the jobs available the market will find a quick sorting mechanism
        This might be to only employ G8 students Or the market might decide to require much higher course GPA (or WAM in Australia)
        I worked in a fairly elite group at one company where we were called the 4.0 club (because everyone in the group had a 4.0 GPA from a top school).
        Initially it was an internal joke that this group (which somewhat self assembled) consisted only of 4.0 students from global top 20 universities, but this joke kinda morphed into a requirement at the HR implementation level. The interesting thing was that word quickly spread through industry that our group existed and guess what we had no trouble filling job slots even though we had these absurdly high entry requirements, that’s the invisible hand of Mr Market at work because being able to say that you worked in our group became your ticket to all kinds of opportunities going forward.
        Bottom line The market knows how to sort, sorting is what markets are really good at. If you want to add regulatory value focus on something other than the sort function such as increasing the overall quality of your courses or graduates.

      • thats what i meant though, even the job outcomes, controlled for grades, between go8s and non-go8 students are the same. alma mater is not a factor in hiring in australia whatsoever.