Comparing university tuition fees with PBRF performance

Trends in tuition fees

The premise of this study assumes that price is a proxy for the quality of a course at a TEO, measured in this study by the quality of research. However, other factors, such as the cost of delivery, levels of government funding and a desire to maintain access for students are likely to have influenced the relative fees set by the universities. To get a sense of fee movements at universities in the eight years of unregulated fees between 1992 and 2000, Figure 1 presents the indicative tuition fee for a student studying full-time in a bachelor of arts at six of the universities.⁵

In 1991, the standard tuition fee set by the government was $1,300 for undergraduate study. In 1992, fees were deregulated and universities were free to charge tuition fees at a level which they determined. As can be seen in Figure 1, from the common starting point of $1,300 in 1991, a significant variation in the Bachelor of Arts fee developed over time. In 2000, the gap between the highest and lowest fee was $550.

Although it may be that students infer quality from the price of tertiary education, the pricing strategies of the universities may not necessarily have been applied with this in mind. For example, Victoria University of Wellington moderated fee increases during the late 1990s as it was concerned about the affordability of courses for students (Victoria University of Wellington 1999). As a result, its fees went from being the most expensive in 1997 to one of the lowest in 2000. Also, the University of Otago maintained the lowest fee during the period 1992 to 2000. How these strategies impacted on the association between price of tuition and the quality of research at these universities is explored in the results section.

Figure 1 Bachelor of Arts indicative full-time fees by university 1991-2000

Source: New Zealand Vice Chancellors’ Committee