Learning to Live with Loans? International Policy Transfer and the Funding of Higher Education

Abstract

Over the last decade or so a number of OECD economies have migrated from providing higher education free at the point of consumption to levying user charges. However, rather than charges for tuition being paid up-front, contributions have taken the form of income-contingent loans. Graduates therefore contribute to the costs of their education, after they have graduated and when they are earning. The earliest example of this instrument was in Australia, with the introduction of the Higher Education Contributions Scheme (HECS). This paper argues that following their successful introduction in Australia, income-contingent loans offer a good example of successful international policy transfer, with elements of that scheme being adopted and modified for use in New Zealand, South Africa and the United Kingdom. The paper reviews the conditions for successful policy transfer and discusses the reasons why the arrangements have not proliferated in non-OECD countries. Copyright 2006 The Authors Journal compilation 2006 Blackwell Publishing Ltd. .

Transfer and translation of policy

“…Likewise, Australian urban transport policies have been spread primarily by policy professionals communicating cross-federally and international consultants mostly from the USA (Bray et al 2011, p. 53). Australia was the first country in the world to institute a broadly based income-contingent charging system for higher education; a system much studied by other countries (Chapman andGreenaway 2006, p. 1066).…”

“…However, the notion of policy learning has been subject to numerous interpretations (Chapman andGreenaway 2006, p. 1061). A useful categorisation has been developed by Dupont and Radaelli (forthcoming) where translation best accords with 1 and 3:…”

An Introduction of a Financial Model for the Australian Higher Education

“…Institutions are allowed to charge students £3000 per annum, which they repay once their annual income exceeds £15,000 (DES 2004). Governments in other countries where university education is presently free are likely to consider HECS-like schemes if they wish to reduce the costs of higher education or increase the number of university places by reducing the per capita cost to government (Chapman & Greenaway, 2006).…”

The Social effects of the Australian Higher Education Contribution Scheme (HECS)

“…Institutions are allowed to charge students £3,000 per annum, which they repay once their annual income exceeds £15,000 (DES 2004). Governments in other countries where university education is presently free are likely to consider HECS-like schemes if they wish to reduce the costs of higher education or increase the number of university places by reducing the per capita cost to government (Chapman and Greenaway 2006).…”