There’s a myth out there that student life is one long party, that student ‘riots’ like the Undy 500 disturbances are the tantrums of the privileged brats and the demand for free education is a middle-class attempt to take more tax money for themselves. The reality is quite different. Tertiary education has become a degree factory churning out skilled labour for capitalism.

One hundred years ago, tertiary education was only for the elite - only 0.4% of the population attended university. However, in 2008, more than 630,000 New Zealanders, or 14.5% of the adult population, participated in formal tertiary study, including industry training. Tertiary education is big business. The Government invests nearly $4 billion each year and universities are major employers. In Dunedin, the University of Otago is by far the biggest employer, with almost 4000 staff and more than 19,000 students.
The massive expansion of tertiary education is part of the expansion of education in general. In the mediaeval Europe, education was a tightly-guarded privilege of the Church and aristocracy. The vast bulk of the population was illiterate and the language of science and philosophy was Latin. The struggle for human liberation has been bound up at every stage with the struggle for public education. However, education has also been used by elites to indoctrinate their subjects and to upskill their workers.
While Otago University taught only philosophy, maths and classics when it opened in 1871, it introduces mining studies in 1872 to provide expertise for the booming gold industry. Some people idealise the era when university education was not determined by the market but classical education was not democratic. It served to provide a common, exclusive culture for a small elite.
But it was not until the 1950s that universities broke away from the classical model and embraced capitalist industry. Tertiary education changed dramatically in the 1960s and ‘70s as the economy demanded more highly trained workers, particularly in areas like health and education. Universities expanded and polytechnics were introduced. Students are no longer just doctors and lawyers-in-waiting and nowadays, a degree is no guarantee of a middle-class life.
Student numbers have grown throughout the post-war period, especially in the 1990s, when despite massive fee hikes, unemployment forced thousands into retraining or ‘upskilling’ – a trend that continued in the last decade. Auckland University’s roll jumped by 10,000 (from 28,092 to 38, 551) between 2000 and 2008 alone.
However, this growth in education was partly driven by high unemployment through the 1990s. Also, there is mounting evidence that higher fees are making tertiary education harder for working class people to achieveFees Timeline
1871 First university (Otago) opens, subjects include philosophy, classics, and mathematics
1939 Only 6000 university students nationwide
1955 10,000 students nationwide
1959 Parry Report recommends a move away from “classical” education towards industry and managerial training
1960 14,547 students; first polytechnic
1973 11 polytechnics
1979 National introduces $1500 fees for international students
1986 Labour cuts top tax rate from 66c in the dollar to 48c
1988 Labour cuts top tax rate to 33c; increases ‘admin cost’ by 80% from $80, Phil Goff announces the end of free tertiary education
1989 Average fees $125
1990 Labour introduces $1250 fees for domestic students, up to $24,000 fees for international students
1994 Todd Report introduces “private benefit” argument
1995-2000 Otago axes six Arts departments
1996 Otago physio students charged full fees of $14,000 for final year
1997 Auckland University sells naming rights for research centre to BellSouth
1999 Average fees $3220
2000 Otago “Centre for Innovation” provides privatised research, student debt $3 billion
2008 630,000 tertiary students nationwide; Student Code of Conduct introduced at Otago; student debt passes $10 billion

The middle class argument

One of the main myths of capitalism is that the middle class expands along with the growth of capitalism. The reality is that while capitalism creates a more educated workforce, many previously privileged professions, such as teachers, become proletarianised – people lose control over their working lives and wages fall relatively. Nonetheless, the ruling class encourages white collar workers to identify not with blue-collar workers, but with upper class professionals like lawyers and doctors. This allows governments to drive a wedge between sections of the working class. This is exactly what Labour did in 1989 when they introduced user pays for education. Labour pitted students against kindergartens, saying students were “middle class” and it was unfair they should be supported from workers’ taxes. They claimed that loans meant fees would not be a barrier for poorer students and that education conferred a “private benefit” the public should not pay for. This concern for working people was a sham, as Labour’s had given millions in tax breaks to the rich and introduced GST – a flat tax that hits working people hardest.
This is not to say higher fees have no effect on working class kids’ access to tertiary education – especially universities. They do. In 1988, just over half of university students came from working class backgrounds; by 1996, a large number of students still came from working class backgrounds but the majority were from professional or managerial backgrounds. Maori and Pacific Islanders have been hit hard. Maori first-year enrolments fell 28% between 1994 and ‘97. Pacific Island enrolments fell 25% in just one year, from ‘96 to ’97.
Students are however, workers as well. According to the 2007 Student Income and Expenditure Survey commissioned by the NZUSA (New Zealand Union of Students’ Associations), 90% of tertiary students partake in paid work whilst studying. This figure comprises 64% of students in regular work, and 36% in casual employment. 58% of students work during the Christmas break, and 64% during other university holidays.
Nor are university graduates necessarily well paid. Only a small minority move into lucrative jobs. The fair way to deal with this private benefit is not to tax all students, but to tax the highly paid graduates. Helen Clark’s Labour government had a great opportunity to do just that, as the wealth of the richest New Zealanders soared over the last decade. Instead, Labour in government presided over year after year of fee increases.

Funding falls

A better educated workforce is essential to lift productivity, which New Zealand has consistently been falling behind in. But Labour and National, keen to preserve profit rates and the salaries of the super-rich, are unwilling to pay for education.

The New Zealand Union of Student Associations (NZUSA) has calculated that the government share of university funding fell from 73% in 1991 to 42% in 2002. When Labour Government education minister Pete Hodgson boasted education funding had increased by 87% in the 15 years to 2006, the New Zealand Vice-Chancellor’s Committee hit back.
“Between 1991 and 2006, university student numbers virtually doubled – from around 88,000 to nearly 170,000.  During those 15 years, funding increased at a much slower rate, meaning that funding per student declined when adjusted for inflation and measured in constant dollars,” Professor Roger Field, chair of the New Zealand Vice-Chancellors’ Committee, said.
“On a per full-time equivalent student basis, measured in 2006 constant dollars, funding has actually dropped from $10,932 in 1991 to $9089 in 2006.
“Universities therefore stand by their claim made yesterday that they are now losing $230 million a year in real terms compared to their position 15 years ago.”

Vice Chancellors

Authoritarian universities

The future of education

Andrew T (with acknowledgement to Dave Colyer and Grant Brookes’ “Students and the Education Factory")