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Uni fee deregulation a threat to quality medical education

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Australian medical schools are world class institutions, and our medical degrees have been an international passport for Australian doctors.

Our medical schools deliver high quality medical education – despite being underfunded in comparison with other developed nations.

In fact, the AMA has long supported calls for an increase in Commonwealth base funding for primary medical education by at least 50 per cent – a necessary investment in our future doctors.

The 2014-15 Budget has delivered a policy prescription that will probably see a lift in funding for primary medical education – via total fee deregulation.

However, it’s not the approach that we would have recommended. The fact is the Government is moving to cut its own level of funding by around 20 per cent, and simply further shift the financial burden on to students.

The economic theory might appear plausible – the market will determine the costs of a degree, with students making decisions about what they are prepared to pay based on the level of future earnings that they might expect.

But the fundamental problem with this approach is that university education in Australia can hardly be described as a true market. The normal rules of economics don’t always apply and, when it comes to medicine, the Government controls the supply of medical school places.

There is only one direction that the costs of primary medical education will go, and that is up.

Given the prestige of a medical degree and the intense competition for places, future students will pay a lot more for a primary medical degree than is presently the case.

If fees charged to international students are any guide, future graduates are going to be saddled with levels of debt close to the size of the average Australian mortgage. 

The Government seems intent on following pro-market policies from the US.

However, we know that the Americans themselves are questioning the wisdom of this approach. It has seen dramatic increases in higher education fees, and yet their higher education system is being outperformed. According to the White House, in 1990, the US ranked first in the world in four-year degree attainment among 25 to 34 year olds. Today, it ranks 12th.


There is also a widening gap in attainment, with students from wealthy families much more likely to enter and complete higher education. Indeed, US President Barack Obama is calling for reforms to make higher education more accessible, affordable, and attainable for all American families.

While the Australian Government will highlight loan schemes that students can take up, this will be no panacea.

There is good evidence that high fee levels and the prospect of significant debt deter people from lower socio-economic backgrounds from entering university.

The Australian medical profession has been a meritocracy for many decades, and it would be tragic to undermine that.

We also know, in relation to medicine, that a high level of student debt is an important factor in career choice – driving people towards better remunerated areas of practice, and away from less well-paid specialties like general practice. 

One of the strengths of medical education in Australia is a talented, diverse student population, including those from lower socio-economic backgrounds, rural communities, and other minority groups.

The AMA does not want to see our merit-based system replaced with one where entry to medical school is based on financial capacity.

We must have a medical workforce that meets community needs, and the Budget measures put this at risk.

Health Workforce Australia, abolished on 30 June, did some good work on future medical workforce projections.

While we can expect to see the overall medical workforce close to being in balance by 2025, there will be geographic shortages as well as shortages in specific specialties.

Clearly, encouraging doctors to work in these areas and specialties will be much more difficult if they have high levels of debt. This seems at odds with the significant effort that has been made by the Commonwealth since the Howard era to expand doctor numbers and the focus on attracting graduates to work in underserviced communities and specialties.

Like much of the recent Budget, the Government’s higher education reform agenda will need to survive an unpredictable Senate.

I hope this process delivers a better policy outcome that replaces a pro-market ideology with a set of fair reforms. These must recognise the importance of quality higher education to the community and the economy, and preserve a sustainable and accessible higher education system.