We
reject the ideas that promote education, culture and media as a segment of a
market. We are against the removal of barriers restricting trade with
education, cultural and media services as the appropriate answer to the needs
of the individuals and society as proposed by the objective of GATS.
We demand that democratically supported services in education, culture and
media are excluded from further GATS involvement.
From
The Brixen/Bressanone Declaration on Cultural Diversity and GATS, unanimously adopted
by the European Regional Ministers for Culture and Education, 18th October 2002
New Zealand’s five education unions and the CTU are in a growing company which opposes education being subject to the WTO’s General Agreement on Trade in Services (GATS), as the opening quote shows. Similar opposition has been declared by four associations representing over 5,000 degree-granting universities and colleges in Europe and North America, and the world’s peak education trade union body, Education International, representing 24.5 million teachers and education personnel, to name but a few.
There is a groundswell around the world. It concludes that international trade agreements accelerate the commercialization of education and threaten its public provision. There are similar concerns about cultural services including broadcasting and film-making, with moves to create an alternative convention for the protection of diversity in education, culture and media that would disassociate culture and education from the GATS.
These movements join protests about GATS coverage of the broader public services such as health, water supply, essential services, local government, and the ability of governments to regulate services in the public interest.
The GATS aims progressively to remove any barriers to “trade” in services, including education. “Barriers” mean domestic regulations, not tariffs and other border measures familiar to trade in goods. Hence the GATS is fundamentally deregulatory, despite ineffectual words in its preamble about the “right to regulate”. It has profound implications for domestic policies.
Advocates claim GATS excludes public services. In fact, hardly any fit the GATS definition of “services supplied in the exercise of governmental authority”. It requires them to have no competition and no commercial element such as user charges. Education and health are certainly not protected by this exclusion.
Born in the same ideological stable as the market-driven domestic policies of the 1990’s, GATS is starkly at odds with moves by the present government to reverse at least some of those policies and repair the damage.
An agreement ratified in 1994 by a previous Cabinet with no Parliamentary - let alone public - debate, explanation or approval, has bound all future governments.
The 1994 government committed New Zealand primary, secondary and tertiary education in private institutions to GATS. How will it affect education here in New Zealand?
First, it guarantees foreign education providers the best government funding it gives local private providers. The number of foreign providers is growing, initially focused on tertiary, but now moving into the pre-school and compulsory sectors.
This means that as long as any government funding is offered to local private providers - including non-profit institutions - the government cannot limit how much it is liable for. In addition to this funding leakage, the public institutions suffer from cream-skimming. The for-profit sector naturally aims at courses such as computing and commerce which the public institutions use to subsidise programmes - such as the physical sciences in universities - which are costly to run but important in the public interest. Thus the limitation of the 1994 commitment only to private institutions is delusory.
To give another example: three Wananga are recognised as public institutions, but there are numerous iwi based and other Maori non-profit private tertiary establishments (PTEs). The government justifies its continued funding to all PTEs (contrary to its 1999 election platform) on the basis that some provide education to Maori that is unavailable elsewhere. But it faces a dilemma if it wants to protect the viability of the Maori PTEs while cutting subsidies to other PTEs to free funding for the public sector. The same dilemma arises if increasing numbers of foreign providers intensify demands on limited PTE funding, starving the Maori PTEs. If the government gives preferential funding to the Maori PTEs, the foreign providers can claim the same funding under GATS.
Maori PTEs could avoid this by being “commercial” operations, in which case they are insulated within a GATS reservation the 1994 government filed for Maori commercial undertakings. But do they want to be commercial? And would the government continue to fund them if they were?
Of course, the government could get out of this particular mess by ensuring Maori aspirations and educational needs are met within the public sector, and stop all PTE funding. But integrated schools and public-private partnerships may provide other trapdoors that force the government to give foreign providers access to the same level of funding as public institutions. The situation only emphasises the urgency to exclude the whole of education from GATS.
Second, there are the deregulatory effects. “Market Access” provisions of GATS prevent the government limiting the number of private education suppliers active in New Zealand, on the number of places they offer, their size, their degree of foreign ownership, or the legal form they take.
The government discovered this obstruction when it found it could limit the number of public universities, but not the number of private ones (so long as they met statutory criteria).
Through charters and profiles, it wants to limit the number of institutions teaching certain courses.
There are calls to reduce the number of institutions providing teacher training.
The growing problems with private English Language Schools has led to calls to cap the number of schools and students.
All of these actions are arguably disallowed under GATS. Or at least, disallowed for private providers. We could still limit the number of public providers - to the benefit of the private sector.
Neither could we require them to have part New Zealand ownership or have student, staff, or community representation on their boards.
But wait, there’s more. In the current round of negotiations, the U.S. wants us to open our full tertiary and adult education sectors - public institutions included - to GATS. While the government assures us that in its initial offer, it won’t broaden its education commitment, we well know the pressures the US can bring to bear - especially if the New Zealand government continues to pursue a free trade agreement with it.
And New Zealand has requested that other countries - like the European Union - open up their full education sectors. Who would place any credibility on our government’s commitment to public education when confronted by that claim?
This deregulatory logic doesn’t stop at education of course. In many sectors, the government is finding that it needs to take action to ensure the viability of services in the public interest. For example, revived rail services are unlikely to be viable under open slather competition with multiple companies all vying for a few bulk deals, neglecting less profitable services. But the government could not limit the number of rail service suppliers - nationally or regionally - because of the 1994 GATS commitments. Similar action may be needed at some time in postal services, telecommunications, electricity, coastal shipping, and many other services.
The government may want to nurture new service industries by limiting their competition for a period.
Central or local government may want to limit the number of hotels or tourism operators in a national park or other sensitive environment.
All are illegal under GATS.
This government already has had to back off its election pledge for local content quotas in broadcasting because of GATS. Michael Cullen admitted to Parliament earlier this month that GATS prevented it tightening controls on sales of coastal land (or indeed any land) to overseas buyers, if services such as tourism, hotels, or lodges were involved.
Even if you find the rationale for some of these GATS-illegal policies debatable in current circumstances, are you sufficiently clairvoyant to be sure that similar policies will never be needed? Because GATS is “effectively irreversible”, as a former Director of the WTO’s Trade in Services Division described it. When making commitments, the government has to anticipate their effects virtually for ever.
But don’t we need GATS to assist education exports? The education unions asked the Minister of Education for evidence of barriers to education exports. The barriers were minor and had been resolved by bilateral discussions. In fact the evidence is that New Zealand’s problems are those of too much success in attracting students, our own capacity problems, and strong competition - not of barriers obstructing expansion. GATS is simply not needed. Perhaps that is why MFAT hasn’t done an impact analysis to weigh possible benefits of GATS against the problems it causes.
Universities have had international student, staff and research cooperation and exchange agreements for years. Well-chosen bilateral arrangements could be much more productive than forced deregulation.
So what is the way out of this chasm? There is hope in the groundswell of opinion around the world with which this article began. The government should withdraw its requests to other countries to open up their education and other “public good” services, which hopelessly contradict its own stated principles.
It should also withdraw the 1994 commitment and end the secrecy clamped on the vital details of these negotiations. They should be treated like entrenched legislation - both in making information public, and in giving Parliament responsibility.
The government could then take the moral
high ground, as New Zealand governments have on other issues. It could join
with other nations in creating an alternative convention for the
protection of diversity in education and culture, and in clearly carving out
public services, essential services, and the right to regulate in the public
interest, from the GATS. In these dangerous times there is safety in numbers.
It is also for the common good.
Dr Bill Rosenberg is National President of the
Association of University Staff.