Voluntary Student Unionism legislation's impact on the finances and membership of student organisations in Australia
Compulsory amenities and services fees levied prior to VSU
Introduction
There have been various previous exercises which have looked at the compulsory
amenities and services fees which were levied by universities before VSU came in, to
assess:
(1) level of the fees at different universities;
(2) total revenues generated nationally; and
(3) typical distribution or uses of these fees.
In this section the results obtained from these previous exercises are reviewed and for the purposes of this study revised and more accurate estimates (in relation to the 2005 year) are prepared.
Estimation of the amount of the compulsory amenities and services fees pre-VSU Parliamentary Bills Digest No. 137 1998-99 quotes an estimate that the average compulsory amenities and services fee imposed by state and territory higher education
institutions in 1999 was $264. The Bills Digest refers to a rough estimate that the
total revenue generated from these fees in the 1999 year was $118 million.
The AVCC, now Universities Australia (UA), has on a number of occasions
conducted surveys for purposes of estimating the total revenue derived from
compulsory amenities and services fees. Surveys of UA member universities on the
subject of student organisations were conducted in 1999, again in June 2003 and again
in June 2005.
The AVCC’s relevant finding from the 1999 Survey on Student Organisations was
that in 1998 the total revenue collected from these compulsory fees in all states and
territories (excluding Western Australia which at that time was subject to WA state
based VSU legislation) was $115.5 million.
The AVCC’s relevant finding from the June 2005 survey was that in 2005 the total
revenue collected from these compulsory fees in all states and territories (including
Western Australia because by then the WA state based VSU legislation had in large
part been repealed) was in excess of $170 million.
The AVCC’s conclusion that the estimated total fees of this type collected in 2005
were in excess of $170 million was presumably based upon the fact that the AVCC
survey from which this estimate was derived was not responded to by all 38 AVCC
member universities. The 32 responding AVCC member universities reported fees of
this type totaling $169,234,261 were collected in 2005.
To prepare the new estimate the starting point is to take the amount of the fee for a
full-time domestic internal undergraduate student at the main campus of each
university and then multiply that by the domestic EFTSL count for the university in
each case. This method was used to derive the rough estimate in Bills Digest No. 137
1988-99.
Where a university was charging GST on the amenities and services fees in 2005 then the EFTSL based estimate is multiplied by 10 / 11 in order to obtain a GST-exclusive
amount. Where the amenities and services fees charged by a university in 2005 were
consideration for a GST-free supply125 then no such adjustment is made to the
estimate.
The AVCC conducted a survey on student organisations in 2003 which, amongst
other things, looked at whether or not universities were charging GST on amenities
and services fees.126 The finance survey issued to universities for purposes of this
study also looked at the same issue.
Where the GST status of the amenities and services fees in or around the 2005 year
could not be obtained from either the 2003 AVCC survey or the responses to the
finance surveys issued for this study then the information was obtained in every case
by reference to university websites.
Once the EFTSL based estimate of the revenue generated from the amenities and
services fees at each university in the 2005 year was obtained the estimate for that
university was then discarded if the actual figure collected for that year was available or could better be estimated from another source - such as from a university
submission to the 2005 Senate Inquiry or from a university response to the finance
survey issued for this study.
The only publicly available national lists of the levels set for compulsory amenities
and services fees in 2005 appear to be those produced by NUS.
On 15 March 2005 the then NUS National President Mr Felix Eldridge released a
research background paper128 entitled Student Organisations in Australia which at
pages 70 to 108 listed amongst other things the compulsory amenities and services
fees levied on full-time and (in certain cases) other classes of students by each of the
universities in 2005.
On 19 October 2007 the then NUS National President Mr Michael Nguyen released a
report entitled NUS First Annual Report into the Impact of Federal VSU Legislation
which at pages 45 and 46 provided an updated list (compared to the NUS list
produced in March 2005) of the compulsory amenities and services fees levied on
full-time internal students studying at the main campus of a university in 2005.
The October 2007 NUS list had differences to the March 2005 NUS list – for
example, the ACU 2005 ASF fee was listed as $400 in the October 2007 NUS list
whilst the same fee was listed as $320 in the March 2005 NUS list. There were also
differences for Flinders, UTAS and UOW as well as an error in the 2007 NUS list for
Murdoch.
It is possible to run a rough cross check on the 2005 fee levels described in the 2005
and 2007 NUS documents using figures provided for the 2003 year by the then
Minister for Education, Science and Training, the Hon Dr Brendan Nelson.
On 1 May 2003 Dr Nelson issued a media release concerning an ACCC third line
forcing decision in the case of James Cook University. The media release130 included
a table showing the compulsory amenities and services fees levied on internal, fulltime
students by each of the universities in 2003.
The 2003 fee levels documented in the former Minister’s media release dated 1 May
2003 and the 2005 fee levels documented in the NUS President’s document dated 19
October 2007 (with the error for Murdoch corrected) are listed below in Table 5.1 for
a full-time domestic internal undergraduate student at the main campus of each
university.
In certain cases there were gaps in the data provided – for example the former
Minister’s 2003 list did not include Bond University and neither of the 2005 or 2007
NUS lists showed the fee charged by Charles Darwin University.
Where there were gaps in the former Minister’s list or the NUS lists the information
was sourced directly from the relevant university or student services organisation for
purposes of completing Table 5.1 below.
After allowing for inflation of roughly 3 per cent per annum and for an error in the
former Minister’s 2003 list (the ACU fee) it is apparent the figures provided in the
NUS Presidents’ 2005 and 2007 lists were in most cases broadly consistent with the
figures provided in the former Minister’s list.
From the figures provided in Table 5.1 below it is estimated the total GST-exclusive
amount of revenue raised nationally from compulsory amenities and services fees in
2005 was approximately $179 million.
This estimate of $179 million GST-exclusive for the total amount of compulsory
amenities and services fees collected nationally in 2005 is broadly consistent with the
2005 estimate provided by the AVCC (which concluded the 2005 figure was in excess
of $170 million)
The estimate of $179 million GST-exclusive is also broadly consistent with a figure of
$170 million previously quoted in the media in relation to the 2004 year by the then
Minister for Education, Science and Training, the Hon Dr Brendan Nelson In the 2007 NUS First Annual Report into the Impact of Federal VSU Legislation132 it
was estimated that the universal student services and amenities charges collected by
Australian universities were $172.8 million in total in 2005. The NUS source for this
estimate was the AVCC media release dated 17 June 2005.
The AVCC media release dated 17 June 2005 quoted a figure of $172,883,639.39
which in turn was derived from Table 6 at page 8 of the AVCC’s previously
mentioned 2005 submission number 176 to the Senate Inquiry.134 The AVCC’s
$172,883,639.39 Table 5 figure is an expense figure – it is not an estimate of ASF
revenue collected in 2005 and accordingly should not be compared to the estimate
provided here of $179 million.
Parliamentary Bill Digest No. 187 2004/05 contained a rough estimate of the total
amount of compulsory amenities and services fees in 2005 of the order of $200 to
$250 million. The Digest stated:
On 16 March 2005 the Minister for Education, Science and
Training, the Hon Dr Brendan Nelson MP, issued a Media Release
which set out the compulsory amenities and services fees payable
at each university, together with an estimate of the total revenue
generated – some $162 million in 2005 (this did not include the
fees paid by part-time and postgraduate tudents).
[FN:2] A rough
estimate of the total revenue from these fees could be in the order
of $200-250 million.[FN:3] FN:2 Dr Nelson’s Media Release can be obtained from,
http://www.dest.gov.au/Ministers/Media/Nelson/2005/03/n1062150305.asp
FN:3 The $250 million figure was obtained by assuming that all
full-time students pay the average fee indicated by the
Nelson table ($328.35 per student), and that part-time
students pay half this amount.
The rough estimate prepared by the Parliamentary Library for Bills Digest No. 187
2004/05 uses 2005 compulsory amenities and services prices which in nearly all cases
agree with those used in this report.
Revenue from Compulsory Amenities and Services Fees Levied in 2003 & 2005
Full-time Domestic Internal Undergraduate Students Only
(ASF rates per student are quoted on a GST-inclusive basis to the extent GST was charged)
(All estimates of total ASF revenue are shown on a GST-exclusive basis)
It is not possible to reconcile the full-time undergraduate student numbers provided in
the Dr Nelson’s media release dated 16 March 2005 because the student statistics
published by DEST for 2004 do not appear to include full-time undergraduate student
numbers – although they do include total full-time students (including both
undergraduate and postgraduate students) and they do include undergraduate students
(including both part-time and full-time students).
The average fee of $328.35 which is calculated by the Parliamentary Library from the
table in Dr Nelson’s 16 March 2005 media release appears to the authors of this report
to be on the high side, as does the rough estimate of $250 million, based upon the
information provided in Table 5.1 above.
For the purposes of this report the average compulsory amenities and services fee per
EFTSL nationally for 2005 is estimated to be $293.21 computed as $178,734,821 /
609,585 (refer to Table 5.1 above).
The 11 universities identified as regional for purposes of this study (refer to Chapter
2) had estimated combined compulsory amenities and services fees of $23 million in
2005 with an estimated average ASF per EFTSL of $238.36 computed as $23,222,124
/ 97,424.
The 84 campuses operated by UA member universities which are included in the list
at Appendix A to the DEST publication entitled Support for Small Businesses on
Regional University Campuses Programme May 2007 had a combined 2005 EFTSL
of 116,091 (refer to Chapter 2 and Appendix B of this document).
These 84 regional campuses had estimated combined compulsory amenities and
services fees of $28 million in 2005 computed as 116,091 * $238.36 (using the
estimated ASF per EFTSL of $238.36 for the 11 universities identified as regional for
purposes of this study).
The Go8 universities had estimated combined compulsory amenities and services fees
of $70 million in 2005 with an estimated average ASF per EFTSL of $347.27
computed as $69,690,180 / 200,682.
Typical distribution or uses of compulsory amenities and services fees pre-VSU.
As noted above, previous studies have looked at the typical distribution of compulsory
amenities and services fees.
Federal Parliamentary Bills Digest No. 137 1998-99 reported on 1973 and 1994
surveys which found that student representation (the SRC area) constituted 15 or 16
per cent of expenditure by student organisations. Endnote 5 of the Bills Digest stated:
5. A 1973 survey of expenditure by student organisations
conducted by the Universities Commission indicated that
student representation constituted 15 per cent of such
expenditure. In 1994, when a number of institutions charged
separate fees for student representative activities, these fees
were (on average) equivalent to 16 per cent of the total
amenities fees.
The AVCC’s June 2005 submission to the 2005 Senate Inquiry estimated that in terms
of where compulsory amenities and services fees were spent the breakdown was:
- 14 per cent on advocacy, representation and political activity;
- 21 per cent on sporting facilities exclusive of sporting clubs;
- 6 per cent on clubs and societies inclusive of sporting clubs;
- 2 per cent specifically on international students;
- 2 per cent on accommodation; and
- 55 per cent on other services areas.
For purposes of classifying the above expenditure areas into the three broad areas
of:
(1) sporting services;
(2) student unions; and
(3) SRCs (inclusive of postgraduate student representation) it is considered not unreasonable to re-state the above AVCC figures as:
a) 15 per cent on SRCs (inclusive of 1 per cent on advocacy and representation
specifically for international students);
b) 23 per cent sporting services (inclusive of 2 per cent on sporting clubs); and
c) 62 per cent on student union services (inclusive of 4 per cent on non sporting clubs and 1 per cent on services specifically for international students).
If the above percentages are applied to the $179 million estimated GST-exclusive revenue nationally from compulsory amenities and services fees in 2005 this would suggest an approximate breakdown of these monies of:
a) $27 million on SRCs;
b) $41 million on sporting services; and
c) $111 million on student union services.
Australian University Sport (AUS) has previously (independently of this study and independently of the relevant AVCC studies) estimated that roughly $40 million of
the ASF monies collected in 2004 went to university sporting bodies156. The AUS
estimate of $40 million for 2004 is consistent with the above calculation that the
sporting services share of ASF monies was approximately $41 million in 2005.
If the above sporting services percentage of 23 per cent is applied to the total
estimated GST-exclusive revenue from compulsory amenities and services fees of $28
million that was collected in 2005 at the 84 campuses operated by UA member
universities which are included in the list at Appendix A to the DEST publication
entitled Support for Small Businesses on Regional University Campuses Programme
May 2007 (the regional campuses), this would suggest the regional campus sporting
services share of ASF monies was approximately $6.4 million in 2005 computed as
$238.36 * 116,091 * 23 / 100.
That is, of the $41 million estimated GST-exclusive revenue nationally from
compulsory amenities and services fees in 2005 that went to fund sporting services,
only some $6.4 million (or 16 per cent) of these monies went to the 84 recognised
regional campuses operated by UA member universities.
Student membership models pre and post-VSU
Compulsory membership distinguished from compulsory amenities and services fees.
There has been much debate about whether, before introduction of VSU, universities
required students to:
- become members of the student organisation as a condition of enrolment; and
- pay a fee for membership of the student organisation.
In its submission to the 2005 Senate Inquiry the AVCC argued:
Ending compulsory membership of student organisations is one of the Government’s main aims ...implicit in this is an assumption that all students in all Australian universities have to belong to a
student organisation. This is not accurate...it is not the case that
all universities require students to belong to student organisations.
More than half of all universities have no requirement for membership or provide exemptions for students who do not wish to
belong to student organisations...
...A further assumption often made in this debate is that students
have to pay to belong to a student organisation ... membership in
most universities is in fact free with 24 of the 38 member
universities of the AVCC provid[ing] free membership of the
student organisation for that university.
From the above excerpt from the June 2005 AVCC submission to the Senate Inquiry
it can be seen that the Vice Chancellors were at pains to distinguish ‘membership of
student organisations’ from compulsory amenities and services fees payable as a
condition of enrolment.
For 24 of the 38 member universities of the AVCC in the year before introduction of
VSU, the Vice Chancellors argued, no student was forced to become a member of a
student organisation as a condition of enrolment.
Table 5.2
Universities Offering Free Membership of Student Organisations in 2005
| CQU |
Curtin |
Deakin |
ECU |
La Trobe |
| UniSA |
UC |
Melbourne |
USC |
ANU |
| Monash |
Swinburne |
CDU |
Murdoch |
UTAS |
| SCU |
UoN |
UQ |
RMIT |
UNE |
| UWA |
UB |
UWS |
VU |
|
As at 2005, before introduction of VSU, the 24 universities which were requiring
their domestic students to pay a compulsory amenities and services fee of one sort or
another as a condition of enrolment but which were nevertheless at the same time offering free membership of their student organisation(s), were those shown above in
Table 5.2 (source: AVCC):158
The Howard Government did not accept the subtleties of the point made by the Vice Chancellors and others that membership of a student organisation is not necessarily the same thing as a compulsory amenities and services fee.
The Majority Report (by Government Senators) of the 2005 Senate Inquiry stated in part:159
Opting out of union membership
1.27 Government senators are concerned that a number of universities offer only a ‘technical’ opt out of union membership. This allows students to opt out of union membership, but still required them to pay the same fee as though they had joined. The rationale offered for charging the same fee was that the cost of union membership is zero. The fees paid, in most cases, still go towards union services. Given the lack of a fee differential it is not surprising that most students do not choose to opt out. The claim that most students support the union because so few opt out is disingenuous...
What is not at issue is whether, before introduction of VSU, universities required
students to pay an amenities and services fee as a condition of enrolment.
Clearly these pre-VSU amenities and services fees, which admittedly did not in all
cases constitute fees for membership of student organisations, were being collected
on a compulsory basis at all 38 member universities of the AVCC.
Extent to which student membership models have been retained post-VSU
Following the introduction of VSU there was a variety of responses by universities and student organisations on the issue of whether or not to operate under a student
membership model, including:
- not operating under any form of student membership model;
- operating under a free student membership model;
- operating under a fee based student membership model; and
- some combination of the above for different parts of the campus service mix.
Campus services organisations which were offering free student membership before
the introduction of VSU in some cases continued to operate under a student
membership model post-VSU but have started charging a fee for membership.
Some campus services organisations are now offering fee based membership which
entitles the student to receive a benefits programme (typically including price
discounts) but which does not give the student membership rights (inclusive of the
right to vote for board members or directors) in the organisation itself.
In a post-VSU setting services which were previously delivered by a ‘student organisation’ governed by a student controlled board are now in many cases being delivered by a wholly owned subsidiary of the university which might have no student directors or only a small minority of student directors on the governing board.
There is now in many cases a blurred line between what is and what is not, a ‘student organisation’. There are also the abovementioned uncertainties about what is meant by the term ‘membership’.
The October 2007 NUS First Annual Report into the Impact of Federal VSU
Legislation echoed somewhat similar views over what the term ‘membership’ means
in a post-VSU setting:160
The implementation of the federal legislation over 2006-7 has in practice superseded the conscientious objections provisions. Voluntary student unionism proponents argued that well run student organisations would recruit members through offering packages of representation, advocacy, services and discounts. What has actually occurred is that the distinction between members and non-members has become somewhat murky...
For the purposes of this section and this section only of the report the term ‘membership’ is taken to mean membership in the organisation itself, usually conferring the right to vote for board members or directors of the organisation. It does not refer to fee based arrangements which confer the right to receipt of a benefits programme but which do not give rights of membership in the organisation itself.
Universities continuing to offer either fee based or free student membership of some
or all of their campus services organisations and where membership confers the right
to vote in elections for the appointment of a majority of the board members or
directors of the organisations, are generally going to be the universities willing to permit student control of some or all of their campus services mix (or “student control
over student affairs” to quote a much used slogan).
The surveys issued for this study examined how universities and student organisations
responded on the issue of whether or not to operate under a student membership
model in a post-VSU setting.
In those cases where universities or student organisations did not respond to the
surveys issued for this study or where there was an apparent uncertainty over what
was meant by the use of the term ‘membership’ in the surveys then the information on
the student membership model issue was obtained from at least two of the following
sources:
- in-depth interviews at the university by study team members (see Chapter 11);
- telephone interviews with the relevant organisations;
- the websites of the relevant organisations;
- the 2007 CAPA report on the impact of VSU on postgraduates;161 and
- the 2007 NUS First Annual Report into the Impact of Federal VSU.162
There are a number of universities where the situation with regard to use of student
membership models is still under review and where further changes are likely.
Even in those cases where universities have already set their course post-VSU in
terms of whether or not they operate under a student membership model of one sort or
another, it is considered that over the course of the next several years a number of
these universities are likely to revisit the decisions they took in this area at the time
VSU was introduced (at least for parts of their campus services mix).
Only three universities nationally appear not to be operating in 2007 under student
membership models in any areas of their campus services mix, as shown below in
Table 5.3.
The three universities in Table 5.3 are not particularly unusual relative to the rest of
the sector in that a material number of universities are not operating in 2007 under
student membership models for substantial parts of their campus services mix, as
explained more fully later in this section.
Six universities nationally are offering free membership of their student organisations
(with the possible exception of limited areas such as gymnasiums and/or club memberships) across virtually all areas of areas of their campus services mix, as
shown in Table 5.4 below.
Table 5.3
Universities Not Offering Membership of Student Organisations in 2007
Notes to Table 5.3
(A) Note the university owned and operated CDU Sports Association (CDUSA) does offer memberships for its Fitness Unlimited area (gymnasium etc) but membership rights in CDUSA itself are not offered. CDU sporting clubs run their own memberships independently of CDUSA. CDU Amenities Ltd does not operate under a membership model. The former CDU Student Association has dissolved.
(B) Flinders One delivers the full campus services mix at Flinders University. Flinders University Council appoints the 11 directors on the Flinders One
Board. The chairperson is an academic, five of the directors are external
two of the directors are appointed students and three of the directors are
elected students. Students are not in a majority on the Board.
A further 10 universities nationally have fully retained student membership models
across all areas of their campus services mix and in addition are charging fees to those
students who elect to become members, as shown below in Table 5.5.
Table 5.4
Universities Offering Free Membership of Student Organisations in 2007
- CQU
- ECU
- QUT
- ANU
- Adelaide
- USQ
Note that of the 10 universities listed in Table 5.5 below who are now charging fees
for membership of their student organisations, seven of these universities were
offering the memberships free of charge in 2005 and before VSU was introduced
(although in 2005 the students still had to pay compulsory amenities fees).
The remaining 19 UA member universities nationally which are not listed in any of
Tables 5.3, 5.4 or 5.5 above have a mixture of different approaches to the use of
student membership models across different parts of their campus services mix, as
shown below in Table 5.6.
Three of the 19 universities in Table 5.6 below are using a mixture of fee based or
free student membership models across their entire campus services mix. The
remaining 15 of these 19 universities are not using student membership models for at
least one or more major parts of their campus services mix.
Table 5.5
Universities with Fee Based Membership of Student Organisations in 2007
- ACU
- Bond (A)
- Curtin
- Deakin
- JCU
- La Trobe
- Murdoch
- UWA
- UB
- UniSA (B)
Notes to Table 5.5
(A) There is an optional student activity fee at Bond University.163 Payment of this fee entitles the student to vote in the elections for both the Student
Council and the Sports Association
(B) UniSA Students’ Association is offering both financial and non-financial
membership packages to students in 2007
In summary 19, or half, of the 38 UA member universities are using student membership models in one form or another across their entire campus services mix
post-VSU.
The other half of the 38 UA member universities are not using student membership models for at least one or more major parts of their campus services mix post-VSU. At some universities where fee based student membership models are being used post-VSU for at least a major part of the campus services mix, there are membership take up rates of less than 5 per cent.
In nearly all of these cases the student membership models are not working at all well. In some cases a large part of the membership income is being consumed by the costs of operating the membership programme.
For many of the cases where 5 per cent or less of the student population have elected to become financial members of their student organisation it is considered likely in future years the student membership model will either be discarded or alternatively the organisation will move to a free student membership model.
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