The government is screwing students doubly.

Not only is it decreasing government HECS contributions, it is lifting caps on tuition fees so that universities can charge whatever they want.

The latter is the most radical change to the higher education system since fees were re-introduced. Heads of Go8 universities, who for some time have been lobbying for uncapped fees, will be salivating at the news.

They can now move towards the model of Harvard, Princeton and Yale – institutions that are renowned for their exorbitant fees, equally exorbitant profits and zero tolerance policy for working class riff raff. The average four year degree at Harvard costs $190,000.

Meanwhile, students from working class and poorer backgrounds will be forced to study at cheaper, underfunded and under-resourced universities.

This two-tier system will not just comprise public universities. The government is allowing private providers into the government scheme. It will funnel more public money into private, for-profit institutions – the same public money that is allegedly in such short supply that we need to trash the health and social welfare systems.

In the US, such providers are often total con-artists whose graduates leave with little prospect of employment. The list of private education providers that will be covered by the scheme in Australia includes institutions such as the Harvest Bible College.

The only caveat to this freedom for universities to set fee levels is that an as yet undefined ceiling will be put in place. It will be a false ceiling; universities will be able to exceed it. Management will just have to channel 20 percent of the additional revenue into scholarships and bursaries for disadvantaged students.

Far from this being an act of kindness, it is a mechanism to poach only the brightest of the working class in order to boost the prestige and rankings of the elite institutions. The US has a similar system.

Against defenders of public and affordable education, Pyne argues that the Australian system is different because we have the HECS loans scheme. The smarm from a man who went to university for next to nothing is almost too much to bear. Two thirds of students currently live below the poverty line. And students currently graduate with an average debt of $19,200 – significantly higher than the $16,000 that Pyne claimed on the ABC’s QandA program on 5 May.

The government wants to undermine HECS, and not just by allowing universities to charge astronomical fees.

The federal contribution to HECS is being reduced by up to 20 percent – which means that even before universities get a chance to increase fees, students will pay considerably more.

Also, the threshold of student debt repayment is to be lowered by around 10 percent and the way interest on the loan is calculated will change. Currently loans are indexed to CPI. In the future they will be indexed to the bond rate.

Students will have no way of knowing precisely how much their education will cost – the interest on the debt will be determined by the vagaries and fluctuations of international financial markets.

All up the budget contains the most severe attack on students in decades. The government has lifted its education policy straight from the handbook of the most privatised, class divided system in the Western world.

The hardship will be compounded by the swathe of other attacks that will have a negative impact on working class students and their families – such as the “Earn or Learn” scheme, which will prevent young people from accessing much needed welfare payments.

Students need to resist these attacks. We need to mobilise in numbers on the streets. The National Union of Students has called an emergency day of action on Wednesday 21 May. There will be protests in cities across the country.

[To find your nearest protest action visit unistudent.com.au.]