No free lunches
A 2007 campaign promise, part of the great giveaway of the Progressive Labour Party platform in that year’s election, was broken yesterday.The promise was free tuition for full-time Bermuda College students, the thinking being that no one should be denied further education for reasons of cost. So rather than providing financial aid for needy students, or reducing fees somewhat but not completely, Government made it free. In many ways, this was admirable. Enrolment rose a little, so presumably some people were able to attend who would not have been able to afford it otherwise. But just three years after tuition was abolished, the programme has been judged to be unaffordable.So now tuition will be charged again. As it was before 2008, Bermuda College remains a tremendous bargain and heavily subsidised with tuition set at around $1,000, about $600 less than it was previously in the 2007-8 academic year. This is not the only free election promise that has been changed or abandoned in the face of financial austerity. Child care was supposed to be free for poorer mothers, but has now been restricted further.Free bus and ferry passes for students may be next; and given the budget restrictions Minister Terry Lister is obviously facing, the Ministry could do with the revenue. Many of these measures were introduced when Bermuda appeared to be in the full flush of prosperity. Little consideration was given to how they would be paid for if the economy contracted or just what the long term cost would be. Still, is it so bad to pay for a service? It can be argued that paying something for any product or service is beneficial since it gives them value. If it is free, then the person receiving it does not value it. We all see this in our daily lives.That’s not to say that people in genuine need should not be helped, or that certain services, when they are in the overall public interest, should not be subsidised. Education is a good example. But paying something for college education, which is voluntary, will help the student see the value of it and encourage them to take it seriously.As importantly, almost nothing in life is free. Just because tuition to the Bermuda College was free for students, that did not mean no one was paying for it. The taxpayer was, and the taxpayer became increasingly overburdened as the giveaways mounted.And in the last few years, fewer people have been taking up an increased share of the tax burden. So a shrinking number of people were paying more and more so others, often less well off, could have something for free. This has become unsustainable, clearly.There is a lesson in this for the framers of the national health policy who are recommending a system by which all people receive a certain level of healthcare and pay for it based on their means. Few would argue that basic healthcare should be available to all and should be affordable. But two basic questions arise. What constitutes basic healthcare, and if making it affordable means subsidising it, who will pay the difference? The health plan argues that those who can afford to pay more should do so.But there is a risk in that if one patient is getting something for less than its real cost, then someone else will be overpaying for it and they will resent it. And there is a risk that this structure will become unsustainable too, to the point that services have to be cut.