Equipping today’s students with the skills needed for tomorrow’s jobs is perhaps the 21st century’s greatest challenge. But how confident are we that our tertiary education sector can innovate to meet the future needs of students?
Not very, is the answer given by the Productivity Commission in a draft report released for consultation last month. Titled, New Models of Tertiary Education, the report briefly grabbed the headlines for recommending the government abolish the interest-free component of tertiary student loans.
In this, the report echoes recommendations in our August publication on the subject: interest-free student loans are inequitable, costly, and have failed to increase tertiary participation. The country would be better off spending the $600 million annual cost on students who need the help.
Coming from a Crown entity, the Commission’s recommendation on interest-free loans may seem radical enough. But the report goes much further. It observes that the tertiary education system is controlled by a series of prescriptive rules that dictate the nature, price, quality, volume and location of tertiary education. As one submitter said wryly, “the Government only controls the number of students, the amount of funding available, the level of fees and what you can teach. Everything else is up to you.”
With access to education centrally-controlled, and choice highly constrained, the Commission’s conclusion that innovation, responsiveness and flexibility are in short supply hardly comes as a surprise.
The report offers two solutions. One involves a series of reforms within the existing framework. Some of these - like the interest-free student loans recommendation - are significant. But the Commission is not confident they will meet the government’s objective of creating the student-centered education system the country needs.
As an alternative, the report seeks feedback on a proposal to turn the tertiary sector on its head: creating “student education accounts” for every 16 year-old New Zealander – like KiwiSaver accounts but for kids.
The $2.8 billion the government spends annually on tertiary tuition would fund each account to the tune of $45,000. This could be spent on qualifying courses that students or their advisers judge best suited to their futures.
By placing purchasing power in the hands of the ultimate consumer, this proposal has the potential to transform the tertiary sector.
As might be expected, most immediate reaction to the proposal was negative. But it deserves careful thought. If the tertiary sector fails to live up to the future, then neither will we.