Make universities pay for picking poorly prepared students

Jayden (not his real name) barely squeaked through school. His Australian Tertiary Admission Rank placed him in the bottom half of school-leavers.

Nevertheless, he was admitted to a university bachelor of education program to train to be a teacher. Compared with school, Jayden found university undemanding. Neither his idiosyncratic spelling nor his uncertain grammar affected his marks. He seemed destined for a teaching ­career until he hit a snag.

Like all prospective teachers, he was required to undertake the Literacy and Numeracy Test for Initial Teacher Education Students, an examination designed to ensure that graduates have the fundamental cognitive skills needed to be effective teachers.

It is hardly difficult. Jayden’s university advises students to prepare for it by studying the National Assessment Program — Literacy and Numeracy tests used to assess school students. Alas, this did not suffice. Jayden failed both the literacy and numeracy parts of the LANTITE. He can retake the test, but if 12 years at school and several more at a university were unable to prepare him, cramming old NAPLAN tests is unlikely to make a difference.

Jayden isn’t unique. Last year, more than 1500 candidates failed the numeracy or the literacy component of the LANTITE. By keeping them from entering the classroom, the LANTITE ensures a minimum level of teacher quality. However, this assurance comes at a high cost.

Candidates do not sit the examination until after a year or more of university study, which means they already have incurred student fee loans. Those who fail the LANTITE cannot teach, and their studies do not equip them for any other job, so they are unable to repay their loans. Taxpayers must pick up the tab.

A less expensive way to improve the capabilities of future teachers is to raise the ATAR required for admission to teacher education courses. This is the approach favoured by opposition education spokeswoman Tanya Plibersek. Under her plan, poorly prepared students would not be lumbered with student loans because they would not be admitted to university.

Improving teacher quality by increasing the ATARs seems straightforward, but it also has problems. As Universities Australia, the peak body for Australian universities, was quick to point out, the ATAR is just one of several indicators that universities use to select students.

If the government required higher ATARs for entry to education courses, universities could swap to other measures. In any event, mandating entry standards — telling universities whom they can admit — is a dangerous precedent for government. To avoid political interference, universities must be free to decide which students to accept.

Instead of focusing on ATARs, the government could limit the number of students studying education. Capping the number of teacher education students would force students to compete for ­places, which would drive up entry standards.

The difficulty with this approach is knowing where to set the cap. The government’s record on predicting workforce needs is dismal. (In the 1990s, the government predicted a glut of doctors. A few years later, it predicted a shortage.) Setting the cap too low could result in teacher shortages.

If teacher education places were capped, universities might direct students with low ATARs into other programs, where similar quality issues will arise. Australia wants more than just high-quality teachers; the country deserves competent graduates in all fields.

Another way to encourage universities to improve the quality of graduates is to focus on the reason they are willing to accept poorly prepared students in the first place: money.

Students pay tuition fees to the university. These fees are funded by government-backed loans. Universities retain students’ fees regardless of whether graduates ever repay their loans.

Because universities bear none of the repayment risk, they are incentivised to accept poorly prepared students. If these students fail to repay their loans, it is the taxpayers — not the universities — who are stuck with the losses.

Formal examinations, government-mandated ATAR scores and capped places may increase teacher quality, but they all have significant drawbacks. The best way for government to improve the quality of graduates is to require universities to share the repayment risk associated with student loans.

Specifically, each university should be made liable for a portion of its students’ unpaid loans.

Given that student debt is already larger than Australia’s total credit card debt, assigning even a small share to universities would have a powerful effect on their behaviour. To reduce their risk, universities would have to be careful about whom they admit, the courses they offer and the skills they impart.

Students, employers and the economy would all benefit. Graduate quality would increase, and the growing mountain of student debt would finally begin to shrink.

Steven Schwartz is a senior fellow at the Centre for Independent Studies and former vice-chancellor of Macquarie, Murdoch and Brunel universities.