Lucy Wicks (Robertson, Liberal Party) Share this | Hansard source

I am pleased to rise to speak in support of the Higher Education Support Amendment (VET FEE-HELP Reform) Bill 2015 and to commend the work of the government in bringing this legislation before the House. This bill is about better protecting students and cleaning out dodgy training providers who have been taking advantage of a system Labor broke. Specifically, the bill before the House today amends the Higher Education Support Act 2003, and I would like to recognise the Minister for Vocational Education and Skills for his leadership of these reforms.

Before I go into why this bill is important to my electorate on the Central Coast, it is important to provide some context as to why we need to see changes made to secure the future of this sector. VET FEE-HELP has undergone major growth. This occurred when Labor axed the credit transfer arrangements between VET FEE-HELP funded qualifications and university qualifications in 2012. I am advised we went from 55,000 students and 119 providers in 2012 to more than 200,000 students and over 250 providers just two years later. That saw tuition fees deferred to the VET FEE-HELP loans scheme skyrocket from $325 million in 2012 up to $1.76 billion last year. In fact, it more than doubled in 12 months.

It should be noted that of course the government supports the principle of VET students being able to access a loan. For many students, this means they may undertake quality training in the same way a university student is supported through HECS-HELP. I understand that much of this growth has been because of the unscrupulous behaviour of a minority of providers and agents. They have been aggressively marketing the scheme, targeting vulnerable people, who are left with a significant debt but no benefit from training. It is often young people who are left with this debt. Quite frankly, this is not good enough.

Sadly but, unfortunately, not surprisingly, the system put in place by the former Labor government failed to put in place some necessary safeguards that would protect students and taxpayers from these rorts. Thankfully, Labor has admitted these failures. A couple of months ago the shadow minister for higher education, research, innovation and industry said:

Labor introduced VET FEE HELP with good intentions but the scheme contains 'fundamental weaknesses' that need to be fixed.

He also said 'regulators were not given enough power to crack down on rogue operators.'

The coalition is working hard on the right process to fix the mess left by the previous Labor government. We have announced a series of measures to restore integrity in the sector. These measures provide the laws necessary to prevent inappropriate enrolments and debts. This includes a two-day cooling-off period between enrolment and application for a loan. We are also introducing minimum prerequisites for higher-grade courses, and a parent's or guardian's signature is now required before most students under the age of 18 years can request a VET FEE-HELP loan.

The bill also protects students and taxpayers by making it easier for a student to have their debt cancelled where they have been signed up for a loan inappropriately. I am pleased to confirm that this cost will be recouped from providers, not taxpayers. We are also introducing minimum registration and trading history requirements and the ability to issue infringement notices attached to civil penalties for any breaches. The changes are designed to make it easier for the department to administer the scheme and also to assist in its partnerships with the Australian Skills Quality Authority. The government's changes also include banning flashy-but-misleading marketing like saying a course is free when clearly it is not and removing withdrawal fees and other barriers for students who want to withdraw from a course.

The government provided $18.2 million in the 2015-16 budget for compliance to support these measures. In short, we are protecting students and making it easier to enforce compliance. The government has consulted widely on the implementation of these reforms, including with dedicated forums. In my electorate these sorts of reforms are part of a conversation we have been having ever since I became the member for Robertson more than two years ago now. In March of last year I held a forum with a number of VET providers in my electorate, and we talked about the need for a robust skills industry. We discussed the need for flexibility, training, stakeholder communication, youth employment and a range of other issues. I have spoken with a couple of providers who were in attendance that day about whether they have confidence in this government's move to enhance the integrity of their sector, and the answer overwhelmingly is yes.

Tony Mylan, the CEO of ET Australia, based at Gosford, said that these proposed reforms are very welcome. Tony said that this should assist in better eliminating certain VET providers who were employing questionable methods, preventing them profiting from unscrupulous business methods in this sector. He shared with me that on the Central Coast there are many prospective students still being told that the diploma they are thinking of doing is free. In his words, Tony Mylan said: 'I hope that the changes will assist those people who cannot see through the marketing hype of the shonks. I hope it forces VET providers to explain to prospective students in easy-to-read statements that the VET FEE-HELP loans, if taken on, will affect their credit ratings.' Tony said, 'It is vital that high-quality training is provided so genuine students may gain from completing their training course and gain employment in their field of study.' ET Australia is working to see all training providers focused on delivering high-quality training for students on the Central Coast.

Eagle Wing Education and Training, who we have also been working with on a local level to hear from them what matters to them, also back these measures. Its CEO, Andrew Church, told me that Eagle Wing previously had 1,500 trainees successfully enrolled in traineeships, with high completion rates but that Labor's changes to the VET sector have resulted in an unworkable system that is confusing and convoluted, which meant that many young, middle aged and unemployed people are not able to access the system and the opportunities to gain further education. As a result, Andrew said Eagle Wing Education and Training now only have 30 people enrolled. He told me that small operators who have a history of successfully training and educating students are being pushed aside. No longer under these reforms.

Nationally, the Australian Council for Private Education and Training also backs these measures. CEO Rod Camm said the council fully supports protecting the interests of students from exploitation by a small number of training providers who have tarnished the reputation of the VET sector. He said these changes have the full support of all training providers committed to quality, integrity and student welfare. Jim Barron, CEO of Group Training Australia, said they firmly back efforts to ensure that training is robust and that taxpayer funds are not squandered on dubious courses and qualifications offered by rogues and dodgy providers.

The government's moves are strengthened by our strong investments in the sector. We have invested $5.6 billion this year for VET through funding to the states and territories to support their training systems and TAFE. There are also up to 250 training places funded through the $664 million Industry Skills Fund, which supports businesses to train their workers and provides free, independent skills advice. The government's budget measures are also benefiting small businesses and organisations in my electorate that are linked to this training industry. This includes cutting the small business company tax rate to the lowest in almost 50 years and for two years giving all small businesses an immediate tax deduction on any asset they buy costing up to $20,000. We are also providing up to $200 million a year for the new Australian Apprenticeship Support Network to provide more help to employers in recruiting, training and retaining apprentices. Trade support loans of up to $20,000 each are also available, and I am pleased to advise that nearly 30,000 trade support loans have been accessed since the program began.

The minister, in his speech, described the VET sector as one 'that has a long and proud tradition in Australia'. For many young people, it provides that the bridge between school and work. For unemployed people, it often provides a pathway back into employment and a life off welfare. And for people in work, it can be the mechanism by which they can expand their skills and progress in their careers. Today I joined with the minister and my colleagues in declaring that the Australian government is committed to ensuring that we have a strong VET sector that helps students and ensures there is public confidence in the system. I note that many of those opposite have shared the government's concerns about the VET FEE-HELP program. I look forward to hearing their support in this debate for these reforms to improve the integrity of this vital scheme for our future. I commend this bill to the House.

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