Matt Thistlethwaite (Kingsford Smith, Australian Labor Party, Shadow Parliamentary Secretary for Foreign Affairs) Share this | Hansard source

I support the passage of the VET Student Loans Bill 2016, the VET Student Loans (Charges) Bill 2016 and the VET Student Loans (Consequential Amendments and Transitional Provisions) Bill 2016, which deal with the ballooning cost of providing vocational education and training student loans throughout Australia as a result of shonky and unethical providers pushing courses on potential and active students that are not in their best interests, which they know they will never be able to pay back.

These bills will introduce a new VET Student Loans program to replace the current VET FEE-HELP scheme from 1 January 2017. Loan caps will be introduced for eligible courses, with caps initially set at $5,000, $10,000 and $15,000. The minister will have the power to exempt courses with higher delivery costs as well as amend and index the caps. Caps will apply to individual qualifications and are not annual. The Commonwealth will have the ability to spread loan payments for students to providers across the duration of a course, as opposed to the current system, where the whole lump sum has been provided to the vocational education institute on the census date and often up-front. This has resulted in many of these private providers signing up to courses people they know will never be able to complete them, signing them up for a loan paid for by the Commonwealth, and getting the payment once the census date is reached, usually after one year of the course, and then not giving a damn about whether or not the individual completes the rest of the course.

To be eligible for loans, a new eligibility criteria will be introduced and students will need to, firstly, be assessed as academically suitable for the course; and, secondly, periodically log in to a portal to confirm that they are active and legitimate students—removing the ability of providers to re-enrol failing or absent students without their knowledge. The Commonwealth will also have the power to immediately suspend a provider or withhold loan payments if it is suspected they are noncompliant.

These measures have been made necessary over the past few years as the VET FEE-HELP debacle has gone from bad to downright disastrous. As this coalition government has sat idly by, asleep at the wheel, the sector has been filling with shonky providers who, rather than provide valuable educational experiences and opportunities to students across the country, have been dishing out pain and suffering through massive, crippling debt to thousands of Australians trying to forge a better life for themselves through quality education.

Stories of deceit and debt have been filling our newspapers and media outlets, revealing the lengths to which private providers will go to secure government subsidies at the expense of often vulnerable people. On 7 October, Fairfax media reported on the sad story of Helen Fielding. Ms Fielding, who grew up in foster care and suffers from an intellectual disability, was targeted by the Australian Institute of Professional Education. She says mandatory tests were forged by salespeople from this institution, who signed her up to a $19,600 diploma of human resource management when they came doorknocking on the door of her housing commission flat in Newcastle. In 2014 alone, this particular institution, Australian Institute of Professional Education, took in $110 million in public funding and has since gone into voluntary administration, leaving up to 16,000 students in limbo. Unfortunately, these types of shonky schemes have been allowed to flourish under the coalition government.

Aggressive sales tactics have been a common factor in the sector, with stories of salespeople regularly targeting housing commission areas with suitcases full of laptops to act as inducements for people to sign up to courses they do not need and have no realistic prospects of ever completing. Aboriginal communities have also been targeted. In November 2015 Fairfax media again uncovered the story of an Indigenous family in a Queensland public housing estate that had been targeted numerous times by shonky providers looking to get rich. The mother of this family, Lenore Lutanichi, signed up to a course with Melbourne's Phoenix Institute in July last year and received a free laptop. She then encouraged other members of her family to think about courses with this provider, and all of her children and all of their partners did the same thing. They all received their own free laptops. Looking back on her enrolment and subsequent hefty HECS-style debt, Ms Lutanichi said, 'It was the most expensive laptop ever.'

People have been targeted in my electorate of Kingsford Smith. Just recently I received an email from a young women named Angela who lives in Coogee, who said that, while searching for a jobs, she had been targeted by shonky course providers bombarding her with emails with what she described as 'private courses being falsely advertised as jobs'. She said course providers had attempted to lure her to pay thousands of dollars for 'self-employment' opportunities or 'careers development' courses that she said were 'not worth the paper they are written on'. These stories are not unique.

VET FEE-HELP loans have blown out from about $700 million 2013 to a staggering $2.9 billion in 2015. But, in the face of such wastage and human suffering, this government has done little more than sit back, do nothing and observe the chaos, before belatedly adopting Labor's course of action that we announced in the lead up to the last election. Before the election, Labor proposed VET FEE-HELP reform. The policy that we released was in a form of a number of changes to the current system, including capping student loans to stop rip-offs; cracking down on brokers; linking publically funded courses to industry need and skills shortages; requiring providers to re-apply under new standards so only high-quality providers could access the loan system; linking funding to student progress and completion; and a VET FEE-HELP loans ombudsman. I notice that there is nothing in these bills about a VET FEE-HELP loans ombudsman, but I understand it was a deal that the Greens had done with the government to gain their support for this. It will be interesting to see whether or not this VET FEE-HELP loans ombudsman ends up in the eventual legislation. This is something that the Labor Party obviously supports.

The Liberals' initial response to measures such as capping student loans was dismissive. They did not want to have a bar of it when Labor proposed this policy at the last election. Some of their senior cabinet ministers were quite dismissive of what Labor and the shadow minister, the member for Cunningham, had proposed. Scott Morrison, the Treasurer, said it would 'pull the rug out from under the private education industry'. Then Minister Senator Scott Ryan called it a 'classist policy' and a 'thought bubble' that 'will lead to up-front fees for VET students'. Simon Birmingham, the current minister, said it was an 'ill-considered flat pack'. That was the view of the government prior to the election when Labor announced this policy. What do you know? They have suddenly done a 180-degree backflip, changed their tune and adopted most of Labor's policies. So the government has come to the party and basically copied all of the measures that Labor proposed prior to the election.

The government have thoroughly let down those students who have been ripped off and they have done so partly due to their own debilitating obsession with internal politics rather than what is in the best interests of this industry. Rather than get to the bottom of the issue, determine a course of action to contain the blowout and pursue dodgy providers taking advantage of thousands of young and vulnerable people, the government has been busy chopping and changing the minister who has responsibility for this issue. I note that in the last three years the government has had five ministers for this issue.

Meanwhile, the future of TAFE remains in the balance as the national partnership put in place by Labor expires in the middle of next year and the minister is seemingly unsure about whether a new agreement is needed to keep supporting TAFE. I have to say that what this government and state Liberal governments have done to the public vocational training system through TAFE colleges has been nothing short of a disaster and nothing short of outrageous. We are seeing their lack of support for public vocational education and training in this country reflected in the absolute roller-coaster in the number of people taking on apprenticeships in this country.

TAFE is the backbone of the adult apprenticeship system. Unfortunately, this fact is not accepted by the coalition government, which has cut almost $2.5 billion from skills and training, including $1 billion from apprenticeship programs and the Tools For Your Trade program since 2013. The $1 billion cut to apprenticeships has seen apprentice numbers across Australia plummet from 417,700 apprentices in September 2013 to 295,300 apprentices in September 2015. That is 122,400 fewer apprentices in training across this country.

They talk about alleviating skill shortages and building the infrastructure of the future to boost our economy, but apprenticeships are vitally important to ensure our nation has the skills base to take on this building task. In my electorate of Kingsford Smith apprentice numbers fell from 3,211 in 2014 to 2,137 in March 2015. That is over 1,000 fewer apprentices who are currently in training in the community in my electorate of Kingsford Smith. That is a disaster for the future of the local economy and our national economy when it comes to training people to deliver the skills of the future. The wheels have fallen off the Turnbull government when it comes to education and training and putting people in courses that deliver the skills to provide the workforce of the future. VET, TAFE and apprenticeships are crucial to jobs in our economy.

With these bills it is good to see that the government has finally got its act together. It is good to see that the government has listened to the Labor Party and taken on the leadership that Labor has shown in this area. I congratulate the previous shadow minister, the member for Cunningham, Sharon Bird, for crafting this policy. She did a lot of work, consulting throughout the country, to craft this policy that the government has ultimately accepted.

With these bills Labor genuinely hopes that the government has seen the light and will manage to do what is in the best interests of students and employers. There is a long way to go and it is incumbent upon this government to get its act together and oversee the successful implementation of these changes. You can bet your life that the opposition, the Labor Party, will hold them to account for these changes and make sure that the proposal is adopted and we do see an improvement in VET student loans in this country and ultimately, hopefully, a boost in the apprenticeship numbers. The government does need to get its act together on TAFE because its approach to TAFE and public vocational education and training has been nothing short of a disgrace.

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