From China, with fear

A close look at one critical neighbour’s education system reveals policy shortcomings in Australia that must be addressed before it’s too late. By Martin Riordan Living on a sabbatical in Shanghai has certain benefits. Up close and personal, the Chinese education system reveals a size and scale beyond expectations for any Australian. Shanghai City alone graduates 20,000 students a year, who all register to study abroad. The wider student numbers make for a giddy ride. The United States is the favoured destination. An education agent describes that in answer to its Study Abroad App, 7 out of 10 ‘like’ the US. Australia is usually a distant third, after the UK. After the booming Shanghai Index and Australian property, the biggest investment market in China is private universities. The Chinese Ministry of Education is expected to ease regulation on this sector in coming years and widen its accreditation, given ever-increasing pressure on Chinese single-parent families trying to secure a local university place for their son or daughter. A prominent private university with 10,000 enrolments has already launched a registered training organisation in Melbourne and has more than 300 Chinese students enrolled down under. It now seeks to secure pathway articulation with a Go8 university for diploma students. Undoubtedly, north and south Asian private university strategies for penetration into Australia will bring the next wave of concerns for the already challenged regulators, ASQA and TEQSA. For example, one giant policy trend surely remains the Ministry of Education’s decision to encourage 600 of China’s 2000 universities to become applied technology or polytechnic institutions. Whilst this plan had push back from the country’s university presidents when the China State Council released initial proposals last year, pressure remains to make it happen. Not least from China’s media, which has showcased that 20 per cent of current local university graduates struggle for a job two years after graduation. Ministry research agencies are now completing criteria that will allocate who’s in and who’s out of this policy mix, with emphasis on innovation indicators. This is the latest of several radical plans for the tertiary education system in China. The Ministry of Education has flagged that it will probably release a further information paper on the university reform plan. Expectations are rising that this will begin from next year. Australia’s international education has much to gain – or lose – from this reform. The China Ministry insists it will be closely tracking the Australian TAFE experience, with internships and industry signing off on qualifications. This is ambitious, but designed so that China may better cope with its extraordinary and fast-expanding technological industry skill needs, going beyond the early years when China was instead the world’s cheap factory base. Combined with trends from India’s improving economy, the China reforms are enormous. These trends will undoubtedly require fundamental shifts in Australian tertiary education and research. TAFEs may have been Australia’s quiet achiever in vocational education, yet the system’s popularity with China polytechnics as a partner in joint offshore transnational education has remained strong and looks promising to grow further. There is no guarantee this position will be maintained; however the odds are good, especially with more than 130 degrees now being offered by Australia’s TAFEs, and streamlined visas adding to pathway capacities. This is attractive to regional students. In Australia, recent Department of Education data shows underlying shifts in recruitment trends. Direct applications to Australian universities outside school-leaving ATAR recruitment have grown to 88,718 in 2014. This looks healthy compared with 2013 (rise of 8.2 per cent), but it is far more considerable when compared with 2010 (45.2 per cent). The largest benefactors of this trend were Innovative Research Universities and the Regional University Network, with private higher education still mainly marketing heavily in the Indian subcontinent for international students. The middle-ranking universities remain focused on maximising their foundation college strategies, while Go8 institutions seem to maintain power regardless, mainly by leveraging brand, which will undoubtedly increase cost pressures on the other universities. The changes in recruitment trends mask a growing structural gap beginning for Australian international education. The failure, to date, of the education minister Christopher Pyne’s higher education reform legislation leaves the sector increasingly vulnerable in this regional policy framework. Australian funding is static and uncompetitive structures remain. Policy does not sufficiently identify risk and quality across universities and non-universities. Student visas and immigration processes are poor in comparison with the fast work of Canada and the US. Pyne rightly blames cross-bench Senators for twice blocking the legislation. But he seems to have decided personally to shelve his earlier review of tertiary provider categories, which may still rank as one of the greatest missed opportunities of the Abbott Government so far in education policy. This review of provider categories alone may have once and for all clearly defined and ranked universities, private colleges, TAFEs and international universities entering the market, with the transparency that’s essential amidst so much change. The incoming Victorian Government’s commissioning of former Holmesglen chief executive Bruce Mackenzie to conduct its own inquiry into TAFE and tertiary education was smart. Canberra risks being overtaken, with each of the eastern states in particular driving improved investment in TAFEs and seeking to better promote their education providers in Asia. Certainly, it is a sign that states have finally woken to the importance of tertiary education beyond universities. Undoubtedly, Australia’s reputation for quality remains firm. Numbers have again steadily increased, and for international recruitment, trends are promising. The booming demand for English-language and foundation colleges has been matched only by massive recruitment for their sales and marketing teams roaming China provinces. Only the Victorian Mackenzie Inquiry and the recent investment by Navitas in the University of Canberra foundation college have shown the mix of boldness needed to meet these new regional demands for growth – and quality. More disturbing in Australian education has been the lack of growth in equity enrolments at universities. The singularly uncompetitive tertiary funding model, biased in favour of the major universities in Canberra, has much to account for when looking at explanations. Equity enrolments, based on socioeconomic status drawn from post code data, show just a 1.6 per cent rise in equity students in 2014, to 18.9 per cent. Offers to low-SES students grew by 2.1 per cent, but after acceptances this quickly reduced to 1.1 per cent. Overwhelmingly, the big growth remained low-ATAR students. University offer rates for under 50 ATAR recorded the largest increase, and even including the SES students, most of them applied for education and nursing. Regional representation also dropped, to complete a comparatively dismal display of diversity now representing the university end of tertiary education. By contrast, TAFEs’ equity enrolments in higher education are large and growing. One of the bigger Victorian TAFEs reports that low-SES proportions in higher education courses range between 23 per cent and 85 per cent. In skills, recent data from NCVER revealed a disturbingly large and further decline in apprenticeships and especially traineeships. This decline has gathered pace each year for five years – under Labor and the Coalition. This crisis can be tracked to each budget decision to withdraw virtually all industry tax breaks and funding for student engagement and continuing employment in skills. These seemed large investments, but NCVER data has provided the evidence these skilled employee grants were essential to students completing many of these skilled jobs. This withdrawal of benefits has devastated skilled employment like retail in the service sector, farm work in regional areas, and for many basic trades and metal work (a key industry in Asia). For the vocational education sector, the winners have been private colleges with high marketing budgets recruiting students with VET FEE-HELP loans and purporting to offer quality skilled qualifications. This has merely shifted debt from the Commonwealth to low-equity students and families who may least afford such offerings. Disturbingly, little research remains on these private college course completions, but anecdotal feedback is that in some cases less than 25 per cent of students with VET FEE-HELP loans complete many of these courses. For Australia, these factors point to a build-up of not just skill shortages and question marks on an economy’s capacity to lift productivity. This is evidence of policy imbalance now across tertiary education. This tertiary policy gap has constrained high-performing TAFEs, while providing extraordinary latitude for the private education market in Australia to respond. More recently, states and territories have sought their own response, with a mix of international promotions and by reviewing their commitments under the Gillard government to totally open access in VET entitlement funding. It was all the more remarkable when Prime Minister Tony Abbott added training to the education portfolio in December last year for Pyne. Balancing tertiary education concerns looks to be a real priority, especially when viewed from Shanghai. It will be fascinating to see how successful Pyne will be at better positioning for training within higher education through this second half of the Abbott term. Success at this is much needed if Australia is to position its quality education more effectively for the next phase of growth in our region. Martin Riordan is on study leave, based at Shanghai Second Polytechnic University in Shanghai, as recipient of a Prime Minister’s Postgraduate Asia Scholarship.