Letter to the Editor: Govt mismanagement kills education

My letter to the editor to the Busslton-Dunsborough Mail:

Adele Farina MLC is right to complain about the hike in fees at SWIT (“Cost kills learning, says MLC” 29/1) but she misidentifies the solution. If Ms Farina really wanted to make the cost of training easier to reach for poorer people, ending subsidies would be her primary goal, not extending them further. While politicians love the talk of subsidies, the economic reality behind subsidies is less loved by politicians and even less talked about. Subsidies artificially increase demand (because it is cheaper), while simultaneously obscuring price signals that would otherwise attract investment and innovation. Combined with government control and central planning in the sector, you have a guaranteed formula for lower quality, stagnation and endless price increases.

Despite this obvious reality, politicians are loathe to allow the end of subsidies because are unwilling face any political fallout from the inevitable adjustment in prices. But while the end of subsidies might resort in some sharp short-term hikes in some courses, genuine competition will encourage investment and innovation in courses of high demand, driving down prices.

If people are to really receive the training they need to get ahead in life, government control and subsidies of education needs to end and we need to let markets do their work – driving down prices through innovation.

Lee Herridge


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