Editorial: Education is not a commodity

Academics blame lack of funding for poor performance on international stage. Photo / by Martin Sykes

Given the funding environment in which our universities operate, it is remarkable how little they have fallen in the latest international survey.

The highly regarded QS World University rankings this week showed that all New Zealand universities had slipped in the league tables. The University of Auckland - the only one in the top 100 - had dropped to 68th place, down from 61st last year.

The University of Otago is down 10 to 135; Canterbury fell one place to 189; Victoria four places to 229 and Massey three places to 302.

Auckland's Vice-Chancellor, Professor Stuart McCutcheon, spoke for many in the sector when he remarked somewhat ruefully that he was surprised our slide was not more pronounced.

It is to the credit of staff at our major universities, who have watched funding steadily decline in real terms for the past 20 years at least, that they have virtually maintained their positions.

In tertiary education, as in the rest of life, you get what you pay for. Worldwide, the correlation between funding and performance is a virtual lockstep, and Auckland - the country's pre-eminent and best-funded university - operates at about two-thirds of the budget of its transtasman equivalents.

Successive governments have lost sight of the fact that tertiary funding needs to encourage achievement, not aspiration. The so-called "democratisation" of tertiary study has improved access and encouraged aspiration, which sounds good, but it has come with a heavy hidden price tag.

As the student catchment widens, average standards inevitably decline. At the same time, by a process known as "credential inflation", a tighter labour market has demanded ever-higher qualifications.

In an attempt to satisfy the demand for university education that this has created, administrations of both stripes have focused too much on students and not enough on universities.

Capping (read cutting) funding and at the same time limiting the institutions' ability to recoup costs through fee increases has forced those at the cutting edge of the "knowledge-based recovery" to run faster just to stand still.

Meanwhile, interest-free student loans are building a fiscal time bomb and maintaining the public focus on tertiary education - for which we pay $4 billion a year - as a private right rather than a public good.

The National-led administration has shown no appetite for repairing what amounts to the slow running-down of the tertiary sector.

Its May Budget cut the business sector's incentives for research and development - the kind of work universities thrive on - and though there is a gradual move to allocating some funding according to institutions' research outputs, the vast majority of funding is based on student enrolments - or "bums on seats".

Aggravating matters, Tertiary Education Minister Steven Joyce has foreshadowed the idea of linking funding to pass rates, which will effectively incentivise the lowering of standards to improve student performance: keep standards high, the policy threatens, and we'll cut your funding.

It is past time for us to accept that tertiary education is not a commodity like milk, or even a service, like health care. It is a resource to be exploited for economic gain, but its yield is directly related to what we invest in it. Our economy is moving away from high-volume, low-value production. Our universities must be allowed to do the same.