Since Steven Joyce had a major policy speech yesterday, I thought I’d cover his points of interest in posts over the next few days.

Tertiary Education Minister Steven Joyce stated yesterday that he wanted to ”have a look at where institutions are heading with their compulsory non-academic levies on students”. He was concerned about recent high growth in such fees at universities and ITPs and said that “I wouldn’t want to see big increases after big increases leading people to think you are avoiding fee regulation by charging in another way”. Drawing upon NZ Herald and Manawatu Standard articles, here are some examples of the fee increases from 2009 to 2010.

1. Uni of Auckland $422 to $542
2. AUT $0 to $360
3. VUW $276 to $510
4. Uni of Canterbury $85 to $600
5. UCOL $0 to $300

Now obviously the Minister has correctly identified a major change in fees. I’d also challenge anyone to convince me that these fees aren’t being set as an end run around fee maxima policies, which would not allow for such high changes in tuition fees. But, and it’s an important but, the fee increases are completely in keeping with the fee maxima rules, because those fee constraints exclude “Learner service levies [1] approved by a tertiary education institute’s council”  (go here and click on Condition SAC 091). The footnote states that “Learner services levies relate to levies for services provided to learners, such as career, accommodation, health, and counselling services.”

Now there might be some items included in the increased levies that are on the margins of the rules and TEC could legitimately chase them for the Minister, but I suspect the real motivation of this announcement is to start a wee brushfire that doesn’t really matter but will show the Minister in support of students. Somehow, I don’t think the Minister really wants to go through and audit every provider’s fees. This diversionary theme is also relevant to the issue I’ll cover in the next post: graduate outcomes.

To be fair to the Minister, there is potential for many other providers to create separate fees for everything they can, thereby raising the costs for students and for the Government, which pays a lot of the bill through student loan writeoffs. But the fact is that it will be almost impossible to roll back the fees that have already been approved and any new rules will just disadvantage the providers that were too late. And then there will be yet another distortion in the fee maxima – such schemes inevitably become more and more complex (until they are swept away in a fit of reform, of course).

So, to answer the question in the headline, this is largely a beat-up by the Minister who won’t do much about it, other than close the door behind those that have fees now. And it’s not a ripoff in general, as providers are unrealistically constrained in their fees and are tyring to find a way around that, but I might come back to the issue of costs for part-time students another day.