Reforms in Australian Education Industry - Assignment - EDUF2006

Running Head: ECONOMICS FOR BUSINESS 1
Reforms in Australian Education Industry
Following the guidelines of the course ID guidelines
Student’s Name
University

ECONOMICS FOR BUSINESS 2
In order to increase economic status of a country, reforms in the education sector can be
termed as mandatory. In context to the Australian education industry, reforms are inevitable as it
is one of the growing industries in the country (Coombe, 2015). In the Federal Budget, the
Australian government has to review the reforms that can make a significant impact on the
sector. In the newspaper article, the author, Bexley (2017) reviewed the pre-budget
announcement directed towards the higher education system in Australia. In the meanwhile,
Simon Birmingham, the Australian Education Minister stated that higher education would be
costlier in the next few years as the government had decided to increase the education fees of the
higher education by 1.8 percent per year from 2018 to 2021 (Bexley, 2017).
By the review of the selected newspaper article, it is apparent that the latest education
reforms in the higher education system will create an adverse impact on the students seeking
higher education in Australia as the rise in university fees for degree course will add monetary
pressure on the students (Gamage & Shangwu, 2016). Under the reforms, the Australian
government decided to reduce the burden of education funding as the contribution of the students
had been increased in the Federal Budget (Bexley, 2017). In this particular study, the issue of the
reform and economic impact of the decision have been discussed.
Due to recent modification in the Australian higher education system, Australian
undergraduate students will now need to pay $2,000 to $ 3,600 more for a degree course in
compared to the previous amount. The alteration in the higher education funding has forced the
students to pay increased fees (Bexley, 2017). On the other hand, the payback period for
education loan taken under the Higher Education Contribution Scheme (HECS) will also be
reduced. Clearly, increased fees of the higher education mean that the students have to borrow
more money and repay the loan in shorter time.

ECONOMICS FOR BUSINESS 3
Moreover, the efficiency dividend has been included that denotes 2.8 percent cuts for
funding in education in 2018 and 2019 (Bexley, 2017). Precisely, the education reform policy
will benefit the government of Australia as the government can save a substantial amount of
funds spent on the higher education system. According to the reports, the education funding will
be reduced by AU$ 380 million by 2019 (Bexley, 2017). Meanwhile, the cuts of funding will
also impact the ongoing research projects in the higher education. Due to rise in fees and funding
cuts, a number of job cuts can be seen in the universities (El-Khawas, 2014). In the next section,
the impact of the increased fees of the higher education on the Australian economy has been
demonstrated.
The Australian Education industry is one of the highest contributors of GDP in the
economy. However, the maximum proportion of the revenue comes from international education
as Australia is one of the most attractive destinations for higher studies across the globe (Halsall,
2013). According to the last ten years statistics, the economic contribution of international
education in Australia has gradually increased in the higher education sector of the economy. A
graph has been presented herein below for further understanding: