On Thursday last week, the University announced that several hundred staff would be made redundant to help shore up their financial situation. They’ve increased student fees by the maximum allowable amount every year for several years now, and borrowed $30 million in December 2022 from bank loan facilities. They just spent $700k on a proposed new logo and $90 million on a delayed new hall. Last year, their target return on income was 3 per cent. They hit 1.9 per cent. This was caused by the “volatility” of “global investment markets”, made worse by the fact that the Government doesn’t fund the university like it used to.
Their committee group hearings are focused on numbers like these, mixed in between chatter about new scholarships, entrance pathways, and international reputation. They’re held in a boardroom in the Clocktower, and the pre-meeting is catered with snacks like little salmon sushi pieces. Some of their council members also sit on the boards of Mitre 10, Cumberland Property Group, and Forsyth Barr.
They say a university needs to run like a business. Does it, though? Government has pushed universities towards a fees-based model, making them dependent on attracting more and more students. When students suddenly stop coming, like we’re seeing right now, the University has to make major cuts. Fees free solves this problem, but fees free was phased out in 1984.
But there is one tertiary institution in this country that is still fees free. It’s SIT, the Southern Institute of Technology, in balmy ol’ Invercargill. The 1990’s brainchild of Sir Tim Shadbolt, it was designed to attract more young people to Invercargill and provide a “debt-free” education funded by the community. It was so successful that it eventually expanded to some international students, too. Last year, Te Pūkenga announced that it would be absorbing all of the nation’s polytechs under one centralised banner. As it swallowed up SIT, New Zealand lost its last fees-free tertiary institution. This will be the last year students can attend without a price tag.
SIT was not always an island in a sea of neoliberal academia. Oxford University was founded in 1096; 300 years before the Black Death, 400 years before the rise of the Aztecs, and 600 years before the Dutch came up with the stock market and the resulting rise of industrial capitalism. And while the university of yore was undeniably white, male and stale, it was most certainly not a business.
How did we get here?
Much like a Year 13 English class, we’ll start with 1984. Tertiary education, as a whole, saw substantial reform with the election of the fourth Labour Government, who shifted New Zealand from a social democratic state to a free market focused neoliberal state. The university system, until this point, had withstood the withering effects of plague, the introduction of Renaissance for-profit money lending, and the rise of big business. But it was about to meet a new boogeyman: neoliberalism. Basically, the idea that “the market” should guide us, free from the constraints of government regulation.
Pre-1984, the New Zealand university system depended on government grants - not revenue. Students largely studied part-time or in specialised colleges, and there was no overarching culture of “everyone needs a degree”. When neoliberalism hit the scene, this funding model changed. Associate Professor Brian Roper has spent much of his career studying these effects, and explained that “public education was viewed as one of the key features of the social democratic welfare state” which was built by the first Labour Government in 1935. “We had barrier-free tertiary education which was funded by progressive taxation, as there was this fundamental idea that universities had a role to play being the critical conscience of society.”
He said that a public service like a university meant that the nation saw public benefits - a sort of return on their investment, to put it in neoliberal terms. “There were public benefits to education, it was good for democracy because you had a more informed citizenry, it was also a fair and efficient way to fund education as it didn’t require bureaucracy or the collection of student debt and fees.” Brian also said that the publicly-funded model of tertiary education also made the conditions of study better, as students did not need to rely on precarious contract work or part-time employment in order to get by. We also just gave students money: “The combination of effectively free education and the universal allowance meant that most students tended to not do part time work, but rather work over the summer, so there wasn’t the same pressure as there is today.”
And when summer jobs won’t cut it, in comes Studylink, an organisation apparently stretched so thin that the only hold music they could afford was recorded by holding a cell phone up to a car radio. “During the period of the Key-English government,” explained Brian, “from 2011 to 2016, government spending was cut by 27.8 per cent. The student loan repayments went from 10 to 12 per cent of income, and statistical trends show that during 2008 to 2016, when these cuts were made, university fees rose substantially.”
The 2022 Green Party inquiry into student poverty demonstrated the need for student incomes to be lifted, with thousands of students living in poverty and struggling to pay rent. A 2023 study into Labour’s 2018 First Year Free policy (which was originally promised to eventually become three free years) demonstrated that students from high income families benefit the most from the policy, failing to address deeper social inequalities.
Progressive taxation is the idea that the rich pay progressively more taxes than the poor. But heavily leveraging this method - as New Zealand has done in the past - is not seen as the best way forward in Government. Brian disagrees. “The idea that we couldn’t fund barrier free education with progressive taxation is nonsense… Our per capita GDP is larger, the size of the economy is larger than it was back in the ‘60s and ‘70s, if the New Zealand Government can fund education then, they can sure as hell do it now,” he said. “We need to have progressive taxation, we need a capital gains tax, we need to increase the top marginal rate of income tax, an increase in company tax, we need to close the loopholes, and there is no excuse on fiscal grounds that you couldn’t reintroduce fees free education.” Brian says it is also unconvincing to argue that enrolments have increased, saying that those cuts made during the Key-English era show just how much the tertiary sector has already lost.
Brian suggested that reduced support and hikes in student fees led to a decline of a hundred thousand tertiary students in New Zealand, and that if we moved toward fees-free education, this trend could be reversed. “It is appalling from a general experience. We have failed to invest in young people who are the future, and it fails to recognise that education improves democracy, citizenry and the economy.”
“The Labour Government was the first to implement large fees for tertiary education,” said Brian. “In the 1990s, the National Government proceeded to underfund universities, meaning [universities] had to impose their own fees to remain financially solvent,” he explained. And at the same time, the student allowance system was subjected to “means testing”. During this experiment, the threshold of parental income “was set so low that… only a third of university students were eligible for a living allowance.” He described the reforms as targeted, and said that the neoliberal model is regressive. “It doesn’t adjust for income. When education was funded by progressive taxation, the rich paid more. But now, whether you are rich, middling or poor, you have to pay off your student loan and it doesn’t adjust to the rate of payment for education relative to income, or the benefits you received from tertiary education.”
Otago University’s Director of Strategy, Analytics and Reporting David Thomson says that, while “the expectation of Government is that universities make a surplus annually” for capital investment, the Uni is not a business in the sense that it has to make a financial return to shareholders. “However, in common not only with businesses, but also all other not-for-profit organisations, they do not have access to infinite funding, and so have to operate in a business-like manner. In general terms, that means they need to live within their means (i.e. they cannot spend more than they earn for extended periods of time). For a range of reasons… Otago is currently in a situation where it is not proving easy to do that.” Thomson highlighted that government funding remains the largest income source for the Uni and outlined for us where most of the funding goes. He said, “Government funding increases have failed by a wide margin to compensate us for the rising costs that are part of a high inflation environment” but that “Government right now is facing its own major financial challenges”.
While neoliberal reforms have affected the tertiary sector on a whole, the social sciences have been impacted in particular. Over the past few years, subjects in technology and the sciences have been financially supported in generally stronger terms than the humanities. In Australia, the Morrison government attempted to double the cost of humanities degrees in order to incentivise STEM subjects. In 2020, the University of Otago axed the Art History department, and there continues to be ongoing discussion surrounding proposed cuts to the Languages and Cultures Department. But the new Dentistry and Chemistry buildings sure look nice. That being said, they just proved that STEM isn’t safe with the axing of the BAppSci programme.
“The social sciences have been targeted by the socio-political forces on the right, and it’s not hard to work out why this might be so,” said Brian. “The adoption of the neoliberal consensus with the IMF, and the OECD’s promotion of liberal democracies, is a way of defeating the forces of resistance against it,” he explained. “The political forces on the right are defeating the forces of resistance which include trade unions, students, workers, ethnic minorities, and social movements such as the women's movement and the indigenous rights movement. Universities remained a bastion of resistance, where there is opposition and criticism of neoliberalism, and this was not appreciated by those forces on the right.” But the targeting of the humanities is subtle and indirect: “It’s not people explicitly saying, ‘We don’t like universities acting as the critical conscience or academics being public intellectuals.’ It was framed along the lines of ‘universities do a better job at serving the interest of business, and that research should be tailored towards these needs’… Universities became much more focused on the need for skilled labour, and there is no longer anything about educating citizens and contributing to democracy.”
Dr Olivier Jutel, who is a lecturer in Communication Studies, echoed Brian’s sentiment. He said that the entrenchment of neoliberalism into the social sciences has created a plethora of problems, and also reflects other concerning social and cultural issues, such as our attitudes towards inequality and the dangers of technology. “Neoliberalism is our new God,” he said. “This idea that we have to justify ourselves in economic terms is part of this problem; we don’t know how to think any other way, and this has impacted the arts.”
He suggested that universities aren’t asking the big questions any more, the ones about what kind of future we want. “We are instead governed by tech oligarchs, so when they create this big spectacle like ChatGPT the first thing they do is take aim at the college arts essay and the types of thinking we do. There is a hostility in the culture towards universities as the critic and conscience of society,” he said.
Joshua James, who is currently completing his PhD in Politics and Gender Studies, provided an interesting insight into the issue. He experienced both the reality of a student loan scheme based system, and what it is like actually working under these conditions in academia. “The premise of a student loan is that you can earn more once you have a degree, however most professions, especially the social sciences, require a masters. So this idea of the three-year bachelors and carrying the debt is starting to become a myth,” he said. Josh also remarked that neoliberalism has also resulted in the “uberfication” of academia due to the lack of full-time work. “You can make profiles and universities will post listings to teach a single week, or a whole course of lectures, and I think that is neoliberalism encapsulated,” he says. “Long term job security is gone, especially in the social sciences because neoliberalism doesn’t acknowledge what we as social scientists provide, and academics have become quantified.”
Joshua said that, while there have been some positive changes introduced such as Labour’s fee’s free policy, there is still a long way to go in terms of reaching a more equitable tertiary sector. “First year free is such a good policy because it enables students to fuck up. They can do all these papers and figure out who they are and what they wish to study without the debt,” he said. Joshua’s outlook on the future remains critical, because “if the first Labour majority government in 40 years couldn’t get rid of the student debt crisis then it is unlikely anyone can. However, when it comes to the politics of fees free education, Joshua thinks that taking an economic over moral approach is the best way for arguing a debt free case. “We must have free education because it would stimulate the economy. Every week, we pay thousands of dollars in debt to the government but, if we wiped student loans, that would stimulate the economy as we know when people have access to a little more money, we know they spend it.”
Joshua also explained that the climate crisis further highlights the need for imminent change in education. “With a recession incoming in the climate change post-pandemic environment, if we want a high tech, low carbon sector, we need free education,” he said. Echoing Olivier’s sentiment, Joshua thinks that “we can’t let the Elon Musks of the world run rampant. We need the humanities. People who are able to think critically and creatively to work in groups. I mean, it’s like Jurassic Park. What if they were to invent dinosaurs without social scientists questioning what we want society to look like?”
Olivier agreed. “It's hard for me to understand how we have been so disciplined to accept that there is no alternative, maybe it's because in the Anglo-Western world we associate our notion of independence with the free market, but there are plenty of other capitalist countries who still provide free education,” he explained, citing France as a place were tertiary education is low cost. Olivier also thinks that reform will be challenging given how politically entrenched neoliberalism is in New Zealand politics. “We have the problem that because our Labour Party were the ones that implemented Rogernomics, we don’t have any people who are from the traditional left wing of the Labour Party, and it has cleared the decks of social democratic tradition… There is a profound failure of leadership by the Labour Party to represent a core constituency, student unions have been hollowed out, Voluntary Student Membership has been imposed, and we have lost a generation of activism and radical legacy,” he said.
Olivier reflected on his time as student, saying, “20 years ago it was easier, housing was decent, rooms were 50 bucks, and that gave me an enriched on-campus experience, because it isn’t about achieving degrees and grades, it's an enriching personal, social and cultural thing.” Olivier thinks that now the pressures of student debt, the cost of living and poor housing has made it difficult for students to actually make the most of their experience. “If you’re stressed and fried in poor housing, how are you supposed to do all that? There is real economic stuff standing in the way of this generation, and students should be able to be here and make decisions about what kind of person they want to be in the world.” Olivier thinks that it is crucial to “defend a humane and enlightened society with ambition”, and that protecting the social sciences is crucial to this. “Student issues reflect the bread and butter issues of our society. How are we going to address housing, healthcare, poverty? It’s all these interconnected questions.”
While it may seem daunting and impossible to think about if the tertiary system can be reformed, or that we may be losing our futures to the tech overlords while the world burns to the ground, Brian remains optimistic in the power that young people have to generate change. “The powers that be, the higher ups, the haves, successive governments, Treasury, the Reserve Bank… they want people to think that neoliberalism is here to stay, that it is permanent and untouchable, [that] we are stuck with high fees and debt from here to eternity,” he says. “But the truth is we are many, they are few, and they are only able to keep getting away with this as long as we let them. Workers are not powerless, students are not powerless, we are many, and they are few. And when people realise this and rise up, we can topple neoliberalism and fund tertiary education, and do many other progressive things.”