Valid Question

John L. Moffat wrote recently: "The Minister of Finance has raised a very valid question—the economic value of education. In suggesting that university courses should be pruned of subjects that make a minimal contribution to the economy, he has not in my view come up with a very realistic answer. To eliminate it (that is man) would require an immense knowledge of history, sociology, anthropology. psychology — the very subjects in short which the Minister would cut out."

The Minister would not cut out any of these subjects, but if expansion had to be limited. some of them and others might be those which it would be appropriate to limit.

Similarly, Professor Henderson, late of the Department of Civil Engineering at Canterbury: "I would suggest that Mr Muldoon release the detailed records on which his figures are based, so that the qualifications of the incoming and outgoing groups may become public knowledge, otherwise Mr Muldoon leaves himself open to the reproach that he is playing his cards so close to his chest that he can't see the cards himself."

These are the groups that are entering and leaving New Zealand.

"I would certainly agree with Mr Muldoon's remark that the new post-graduate scholarships are having a marked effect in keeping bright young men within New Zealand.

"The effect is much more permanent than the two or three years' currency of the scholarships themselves, for this period gives each young man time to acquire a permannt emotional commitment to a New Zealand girl. Once he does so. we can let him leave the country confident that he Will eventually return."

An interesting point.

The source of the figures was of course stated in my address

I spoke at Masey University early last year on the introduction of computers into New Zealand universities, and the expansion of computer applications to the point where every person graduating at present should have some understanding of the assistance that can be obtained from a computer in the field in which he proposes to work, because during his productive lifetime this power will be available to him.

Part of my remarks on that occasion arose from a lengthy discussion which was arranged at my request with John Diebold in New York, who is looked upon as the world's foremost authority on computer applications. He is the head of a multi-million dollar company which devotes itself entirely to computer applications.

Professor Henderson, however, was critical in these terms: "Not only did we have a computer at Canterbury by 1960, but from that dale we included large sections on numerical analyses and computer techniques in all three stages of our engineering mathematics courses. Now Mr Muldoon's advisers could have found this out by spending 50c on a University of Canterbury calendar." and so on.

Well of course we would have spent the 50c on the calendar had we known which calendar to buy, but we knew about Canterbury's computer anyway.

"Mr Muldoon quoted an eminent American to the effect that New Zealand is unlikely to develop its own electronic industry capable, for instance, of making computers. Speaking not for myself but quoting another Canterbury department. I should tell Mr Muldoon that our electrical engineering department begs to differ from his American adviser, and I would throw in my own opinion to the effect that the advice of the man on the spot may well be worth more attention than that of the remote 'overseas expert' who so impresses the New Zealander. This is particularly true if the man on the spot is saying 'it can be done'. and the overseas expert is assuring you that it can't."

Diebold just happens to be number one in the world. But apart from that the mass production of components in what is now becoming known as the semi-conductor field, is so labour-intensive that American corporations are setting up factories in such countries as Formosa, South Korea and Singapore, solely because they would otherwise be priced out of the American market

"But Mr Muldoon's remarks leave me with the impression that although he is trying to he helpful he is not perhaps getting enough competent advice for him to appreciate what a vigorous influence a good university can have on professional practice and on society's problems generally. May I ask how Mr Muldoon's advisers Dot their facts about the universities? None of them to my knowledge ever pays us a visit, and as I have said, they can't afford the price of a university calendar, so how do they get any sort of feel for what is going on in the universities. I don't know, but they do seem to speak with all the confidence and conviction of the utterly misguided."

All good stuff. Some of you will know that my official advisers are graduates, part-time lecturers in many cases, and in some cases current under-graduates. Some of you will know that I personally made a round of every university in this country a year or two ago, and discussed with Vice-Chancellors and staff their plans for development, not just of buildings and equipment, but of courses

I don't quote Professor Henderson in a critical sense, but simply to illustrate that in the field of public controversy it is important to make some investigation of one's facts, otherwise ammunition is being fired off at the wrong target and there is no real interchange of ideas.

Now the question of failures

Failures are wasteful. What do they cost? I asked Treasury to make an assessment for me. They came up with the round figure of $3000 for a student failing three subjects on a full-time basis, or $1000 per unit.

Quote Mr P. A. Amos. M.P., Auckland Star, March 6. 1968: "Mr Muldoon has said open-door admission resulted in a higher failure rate than overseas where entry was selective, and each failure cost New Zealand $1000, making a total waste of $10 million a year. The figure $10 million seemed a fantastic sum plucked out of the air. or arrived at by an accountant who ignored the real economic situation "

Not plucked out of the air—calculated by a Treasury officer who is a graduate of one of our universities.

I checked the theory, and the only field in which I claim expertise is that of cost accounting, and made up in this manner:

Income foregone by a student during the university year —about $1400

Current university spending per student —about $1040

Current cost of occupying buildings —about $620

Total $3060 rounded to $3000

This assumes a post-tax income over the full year of $2100; current government and private spending on universities of $16 million divided by the number of full-time students, which at that time was 15,500; the cost of buildings, being the capital cost, at 7 percent. being interest at 6 percent and depreciation 1 percent, divided by the number of full-time student equivalents enrolled.

The figures may be rough, but would be as near as is possible by any other method, and obviously a round figure of $10 million is simply a measure of the degree of waste and not a precise calculation.

So how do we do something about it? $10 million is worth doing something about. If we lighten up on entry, we get less failures, but we lose potential graduates. This is certainly, in my view, a matter for the responsible authorities to balance the loss of graduates against the cost of getting the final marginal graduate. The economic waste would I believe vary according to the discipline concerned, and brings back the concept of weighting the various faculties in terms of economic return.

Late last year I had a visit from Dr Llewellyn formerly chairman of the University Grants Committee, and now Vice-Chancellor of the University of Exeter. We have had many chats over the years on the future of university education, and he took the opportunity of his visit to have another.

In the course of our discusion he made the point that in Britain out of 100,000 students qualified to enter university, only 50,000 are accepted, yet Britain gets as many graduates from that 50,000 as New Zealand proportionately would gel from 100,000. He is very strongly of the opinion that the small student failure rate of 5 percent in Britain and in Exeter 3 percent, is highly desirable, because a graduate has normally graduated without any failures, whereas in New Zealand failure of some units is normal and in his view the student becomes failure-orientated.

I can't place a value on this criticism, but there is obviously some strength in his argument.

The next day I was addressing a group of secondary school headmasters in Wellington, and gave them these comments, although I asked the Press not to print the fact that they had come from Dr Llewellyn. Accordingly they were published, and I was immediately under fire from all kinds of quarters for making this shocking suggestion. The Press, being alert and alive to these situation, contacted Dr Llewellyn and asked him what he thought of my comments. One of the headline that came from that interview was:

"Ally for Minister in open-door varsity criticism: Criticism by the Minister of Finance. Mr Muldoon, of what he calls the loose screening system which allows a conglomerate mass of students to enter university has been echoed by a visiting university head from Britain. Dr Llewellyn said in Christchurch page 5that because of rigid selection and competition for entry, the student failure rate in Britain rarely now exceeds 5 percent — at Exeter it was 3 percent. "New Zealand's policy has been that all who qualify are entitled to enter a university," he said. "The public conclusion seems to be that it is more beneficial for a student to enter for only one year than not to attend at all. There is something to be said for this, but is it possible for New Zealand to go on with relatively easy entry to university when the number of students is rising disproportionately to the increase in population? I am quite certain Britain could not afford New Zealand's present provision. The cost of each student to the British taxpayer is higher from $1400 for an arts student, compared with $600 to $700 in New Zealand. However, for a New Zealand student failure is part of his expectation. Most will fail something at some stage. The British student is elected in expectation of success. Whatever was done in New Zealand should be done deliberately and slowly."

He gave warning of the new situation in his last Grants Committee report to Parliament in 1966. Well, it was no surprise that he supported the views that I had expressed, having regard to the fact that the views originated with him. Going back to University Grants Committee reports, there are two which are worth quoting at this point:

(1) Extract from University Grants Committee report for 1965:

"In its report for 1964 the Committee set out details of the new quinquennial grants to the universities to meet their recurring costs for the five years ending 31 March 1970. It also recorded a warning that the cost of maintaining the policy of open entry to the universities, declared by Government of both parties, would be considerable over the next few years and whether that policy can be maintained or whether the universities will be compelled to use their powers of restriction of entry depends on whether the New Zealand community is prepared to meet the cost. The main issues remaining now that the quinquennial grants have been approved are those of staffing and buildings, and the problems associated with these are salary scales adequate to enable the universities to compete for staff in the world market and the difficulty of implementing the university building programme in conditions of an overstrained building industry. These two problems are likely to be major concerns of the university system for the years immediately ahead when student enrolments are increasing rapidly."

(2) Extract from the report for 1966:

"Universities have developed in different ways at different times but two broad systems of higher education can be distinguished. There is the broadly based comprehensive system with its large numbers of students typical of North America and there is the small, selective, hierarchial system of the older countries of Western Europe. It is this latter restrictive system which is today being found to be inadequate for modern needs and which in Britain will be radically overhauled if the recommendations of the Robbins Committee are implemented. This Committee based its report on the proposition that there should be a place for all who can satisfy the entrance requirements and who wish to proceed to high education.

Governments of both parties in New Zealand have declared a similar policy—that faculties will be made available in our universities for all young people who pass the University Entrance examination, who wish to go to university, and who are prepared to study hard and successfully while they are there. The implications of this policy for our universities are far reaching indeed. Not only is their traditional right to select whom they shall teach severely restricted, at least in the first year, but the quality of their work—their other traditional rights of determining how and what they shall teach—are largely determined by the staffing and physical facilities made available to them from the only significant remaining source, the Government.

"There is therefore an obligation on the community to see that the demands it makes on the universities are matched by the facilities to meet those demands. The cost of maintaining a policy of open entry to the universities will be considerable, particularly over the next few years. Whether the policy can be maintained or whether the universities will be compelled to use the powers of restriction of entry given to them by Parliament in their acts depends on whether the New Zealand community is prepared to meet the cost. The main costs are those of staffing and buildings."

In Britain, however, economic events of recent years have caused a change in British Government policy for the expansion of universities, which was introduced with such a flourish just a few years ago. Apart from generally cutting down, there has been a recent crash programme, and this is the kind of thing that I fear we might strike in this country at some time in the future. I quote from the Economist, August 17, 1968:

"The universities of Britain are on vacation — the Vice-Chancellors and Professors are orating round the world at conferences; lesser dons, like everyone else, sporting by the sea. If this were term-time the uproar from them would be deafening. An as yet unpublished letter from the University Grants Committee to its clients tells them that they must stop all their plans for new buildings except where contracts have been already signed. This could hit as much as half the £10 million capital spending plan for the current year. Last January when the government announced its schemes for moderating the future growth of its own expenditure, the universities escaped amazingly lightly. A little capital spending was to be deferred in the next couple of years, but no item of current spending was touched and politically-conscious academics assumed that the enforced lag in capital spending would not last long. Things look very different now. Quite suddenly it has become the fashionable thing to deplore what was until very lately the fashionable thing to praise. This sudden shift of public favour away from university expansion combines in its inner recesses the envy of the young and the hatred of intellectuals that are among the chief banes of English political life. It is compounded by uncomprehending funk of the world craze for student militancy, which incidentally has so far caught on only among very few students here. The worst sort of long-term damage that any country can inflict on itself is to prevent its citizens getting the education they need, demand, and are ready for. Re-organising the universities, pressing them to become more useful, more economical in the use of funds, more valuable to their students, is one nest of crabs that all governments have shirked. Cutting them down is quite another affair. The educational record of Mr. Wilson's administration is already disastrous. This is the crew that has crippled the growth of secondary schools and postponed the raising of the school leaving age. One hopes that some politicians will have the guts to protest and loudly, even if students, like coloured immigrants, have become an unpopular minority in the increasingly bizarre world of some politicians' imaginations."