University heads call for fee rise

University fees should rise if New Zealand wants to keep up with its international counterparts, say Auckland vice-chancellors.

Professor Stuart McCutcheon, of Auckland University, said the attraction of higher salaries for professors and advanced research facilities in other countries was exacerbating the brain-drain phenomenon.

Salaries for top professors in New Zealand were about 50 per cent of what was offered by Australian universities, he said.

The average New Zealand university student fees were $2538 in 2006 while Australia's were $5289.

In New Zealand the Government provides a set amount of funding for equivalent full-time students and also sets a cap on the maximum fees a university can charge students.

This funding had been raised according to the consumer price index and not the actual cost of running a university, resulting in a $250 million loss of revenue year-on-year over 20 years, Professor McCutcheon said.

He said the University of Auckland's share of that was about $50 million per year. "Well you imagine what I could do with salaries if I had an extra $50 million per year."

Professor McCutcheon said most costs were sapped up by salaries, which were rapidly rising to keep up with what was being offered overseas.

And because the Government has cut funding for top achiever scholarships for doctorate students it is facing an even bigger battle to keep the brightest students from continuing their research abroad.

The University of Adelaide recently ran an advertisement in the Herald offering New Zealanders with bachelor's degrees free airfares and hotel accommodation to check out continuing their studies at the campus.

Although Professor McCutcheon believes New Zealanders travel, when they go to study in Australia for three or four years there is a very high probability that they will not come back.

"This is a significant risk from a 'brain drain' perspective. If we can't retain our top students here, that means we can't grow our own professors ... we can't contribute people who are highly qualified into business and into government," he said.

Professor McCutcheon said he could not estimate how much the University of Auckland would raise its fees by if the Government's cap was lifted or removed but pointed out that Australian universities were receiving almost double the funding he was per student.

Derek McCormack, the vice-chancellor of AUT University, said the sector could no longer pretend its costs were not increasing and the quality of education offered would be compromised if it continued to run on efficiencies.

Jordan King, co-president of the New Zealand Union of Students' Association said he agreed the tertiary sector was underfunded but said the Government, not students should be putting more money into it.

"It's not fair to punish students for a situation that they played no part in creating."

Students already struggled with fees and had a burden of about $10 billion worth of debt hanging around their necks, he said.

Professor McCutcheon said fee increases would also allow universities to offer a greater number of scholarships for financial hardship.