Fees and funding in New Zealand could be set for a shake-up, after the country¡¯s university review switched its focus to ¡°efficiencies and prioritisation¡±.

In a??for its third round of consultations, the?University Advisory Group?notes that institutions have already made ¡°hard¡± decisions. ¡°What reprioritisation might further be considered?¡± it asks. ¡°Does the current system have the right balance of public (tuition subsidies) and private (student fees) contributions? What changes should be considered?¡±

Consultant Roger Smyth said that while the questions had raised some alarm, the panel ¡°wouldn¡¯t be doing its job¡± if it overlooked such issues.

¡°It¡¯s entirely reasonable for the group to be considering scenarios that involve either static or reducing income,¡± said Mr Smyth, a former head of tertiary policy at the Ministry of Education. ¡°Everything should be on the table.¡±

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He said the panel might consider the size of fees and loan repayment arrangements, including whether the zero-interest loans should be indexed. The proposal to shift the ¡°fees-free¡± scheme from the first to the last year of studies could also be examined.

Any changes to loan settings would need careful reflection, he warned. ¡°It¡¯s a complicated area.¡±

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Universities New Zealand chief executive Chris Whelan said average student loan balances in New Zealand were reasonably low, reaching around NZ$36,000 (?16,710) and typically paid off in about eight years.

Students and graduates are taxed 12 per cent on earnings above NZ$24,128 a year. ¡°That is a burden on a young person out of university [who] wants to get on with life,¡± Mr Whelan conceded. ¡°Are those settings still right? A review like this is a good time to ask that question.¡±

Marcail Parkinson, president of Victoria University of Wellington Students¡¯ Association, said ¡°most¡± students started paying off their loans before they graduated. Part-time hospitality jobs to cover living costs pushed many over the repayment threshold, she said.

Ms Parkinson said fees, loans and student allowances were a ¡°massive issue¡± and the panel was right to consider them. She said?living costs?and debt aversion were a particular obstacle to participation by people from marginalised groups who were expected to contribute to their families financially when they reached working age.

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She said the broader economic benefits of higher education were ¡°really strong¡± and spending on students ¡°would probably end up paying itself back through taxes¡±.

Mr Whelan said the panel was right to look for efficiencies but warned that they would be hard to find. ¡°There are savings but they¡¯re all things that are going to compromise student experience [and] quality.¡± Opportunities for collaboration mostly required upfront spending to secure ¡°uncertain middle-term returns¡±.

Mr Smyth said he expected the panel to scrutinise the?Performance-based Research Fund, a laborious assessment exercise which guides the allocation of NZ$315 million of block grants each year, and the investment planning system, a three-yearly process where universities outline how they intend to use government funding.

¡°Both of those are obvious candidates, at least for a look. You [might not] necessarily do away with them, but you might try and find more efficient ways of doing them.¡±

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Consultation closes a week before Christmas, with the final report due in February. An interim report produced in September, currently under consideration by the government, is expected to be released before the year¡¯s end.

john.ross@timeshighereducation.com ?