Brian Mitchell (Lyons, Australian Labor Party) Share this | Hansard source

I rise with pleasure to support the Education Legislation Amendment (Provider Integrity and Other Measures) Bill 2017 as it strengthens integrity in vocational and higher education. It updates the 'fit and proper persons' provisions, strengthens processes around the assessment of provider histories and provides additional powers for the department secretary to share information with agencies and the Overseas Students Ombudsman. It prohibits unscrupulous marketing practices—we all remember the scandal of inducements such as free iPads and gym memberships—it stops cold-calling and it puts an end to barriers being imposed on students' desire to withdraw from study. The amendment also changes the definition of 'genuine student' for the purposes of accessing FEE-HELP, improves compliance arrangements and provider application requirements, and increases financial viability and financial transparency agreements.

Labor supports these measures because Labor wants a stronger vocational and higher education sector. Labor also fully supports a robust and rigorous higher education regulatory system. We welcome greater scrutiny on the background of organisations that seek the privilege of operating in Australia's higher education system. Indeed, Labor recognises the vocational and higher education sectors as vital to Australia's economic growth. Australia's economy is changing fast, and the skills that Australian will need to win well-paid and secure jobs are changing fast too. As a mining company executive told a hearing of the Joint Standing Committee on the NBN in Tasmania recently, he no longer needs people skilled with spanners, but people skilled in computing and diagnostics.

Australia needs to invest in education, skills and training that will drive 21st century enterprise, which makes the government's budget this year so inexplicable. In this year's budget the government is cutting another $600 million from TAFE and apprentices, $3.8 billion from universities—including $30 million from the University of Tasmania—and $17 billion from schools. Australia now has 130,000 fewer apprentices and trainees than when the government was elected. When it comes to higher education, this is a government that wants to increase students' fees at the same time as it slugs students' incomes and cuts investment in universities. Repayment of HECS fees is kicking in, I think, at $42,000 a year, which is well under the average weekly wage, so it's widening the income inequality gap that has been in so much talk recently. That's not a good thing when we want to invest in education. We are making it harder for kids from working class areas and regional and remote communities to get into university. We are making it hard for them to contemplate the very idea that university is an option for them; they won't even consider it with the high debt that they are expected to go into. Once again, we run the risk of university education in this country being the preserve of the upper middle class and the well-off—people with high incomes and access to capital—rather than kids from working class suburbs like the suburb I grew up in.

The cuts in public funding are expected to result in between 7,000 and 9,500 full-time equivalent job losses across our universities. These are jobs we can ill afford to lose. It's a classic case of pay more and get less—a bit like the NBN, I suppose. Another witness told the NBN committee that the NBN was costing $60 billion to roll out, but would be worth just half that on the open market. These are not results to be proud of. These are not the numbers of a government committed to an education sector designed to deliver the skills and training required for full participation in the 21st century. TAFE and vocational education funding and the number of supported students are all lower than they were a decade ago, and this is despite an increase in the number of jobs requiring vocational skills. Too much of the shortfall has been made up by the importation of workers on visas, and that is another issue Labor will address in government—that is, ensuring that a better balance is struck.

The next Labor government will reverse this government's cuts to skills and training, and invest in TAFE and apprenticeships by investing an additional $637.6 million into TAFE and vocational education—reversing the government's 2017 budget cuts in full. We will guarantee at least two-thirds of public vocational education funding goes to TAFE, restoring TAFE as the central pillar of Australia's vocational educational system. We will invest $100 million in a new 'building TAFE for the future' fund to re-establish TAFE facilities in regional communities, such as my electorate of Lyons in Tasmania, to meet local industry needs and support teaching for Australia's digital economy. Labor will set a target to ensure that one in 10 workers on all Commonwealth priority projects and major government business enterprise projects is an apprentice. We will invest in pre-apprenticeship programs, preparing up to 10,000 young jobseekers to start an apprenticeship—a real apprenticeship, not this 'job pathway' fraud that is being perpetrated on young people by this government. We will establish an advanced entry adult apprenticeships program to fast-track apprenticeships for up to 20,000 people facing redundancy or whose jobs have been lost.

With these comprehensive measures, Labor will reverse the decline in TAFE and apprenticeship programs and provide young Australians the pathways they need to contribute to Australia's economic growth in the 21st century. Currently those pathways are littered with shonks and rorters, and that is why Labor is happy to support this bill. It is a sad fact of life that public policymakers seem to always be surprised by the slyness of shonks, who are willing to damage other people in order to advance their own economic self-interest. If there is one lesson that can be learnt when it comes to developing public policy, it is to design much more defensively—especially when it comes to policies that involve public expenditure. Policymakers, whether in departments or in this parliament, need to role-play and cast themselves as crooks and conmen and seek to exploit their draft policies for personal gain so that they can plug those gaps that are identified.

Good people who wish to believe that others act only for the common good find it difficult to comprehend sometimes that well-intentioned policies can be misappropriated by cons and crooks. But the fact is there are people out there adept at sniffing out how to get their hands on public money. They find the loopholes, they exploit the policy weaknesses and they pounce. Sadly, this was the case when, with the best of intentions, access to VET FEE-HELP was extended to include diplomas and a broader range of providers. The shonks cottoned on that if they signed people up to courses they could be paid by the government for the placements. These bloodsuckers engaged agents on commission to trawl the outer suburbs of Australia's cities to sign up new students by using heavy selling techniques, like those they used on Bradley Smith from Clarendon Vale—a working class outer suburb of Hobart in Tasmania.

Despite having struggled at school, Bradley was told that, if he signed up for a three-year diploma in business management, he would get a free iPad. The small print was that it would cost $26,000 in fees, but he would not have to repay those fees until he started earning more than $50,000 in income. Luckily, Bradley's mum showed the salesperson the door before Bradley signed. But there are thousands of Bradleys across Australia who were not so lucky, who were signed up for courses they had little hope of attending, let alone completing, but who were then on the hook for the repayment if they ever earned enough to commence the repayments. Students were signed up in their tens of thousands across all sorts of providers, a number of them completely new to the sector.

Soon it became clear that far too often what was being offered bore little relation to what was being delivered. The training regulator pulled the reins and started demanding proof from providers that they were delivering the courses they were selling. Access to public funding was cut, unless proof was forthcoming. And, like dominos, they started to fall. Provider after provider was either ordered to cease trading or went bust. Careers Australia, Smart City, RGIT and Avoca are some of the bigger names to have fallen. The victims are the staff left without jobs and the students left without courses, diplomas or degrees but with fees still to repay.

The National Audit Office has been damning of the education department's handling of the issue. There was no concerted effort to deal with the emerging problems until after last year, when allocations under the scheme reached $2.9 billion. Now more than $2 billion has been essentially written off, has disappeared into the accounts of shonks, but the course fee debts have not been forgiven for students left without courses to complete. Staff without jobs and students without courses are the victims in all this. Labor is backing this bill because we need to ensure it does not happen again.

Phil Honeywood, chief executive of the International Education Association, is backing the changes, saying the inclusion of reporting on agent performance would 'promote greater transparency and accountability in educator-agent relationships in the wider sector'. While positive, he also cautions there is a need for ongoing vigilance to protect Australia's international education brand and to close the loopholes that wrongly motivate education providers. He said:

Even if providers abide by all existing legislative and regulatory requirements, in seeking to maximise their enrolments they can often encourage a 'race to the bottom' with abnormally low tuition fees particularly for business studies/accounting courses …

By the time these providers have paid large commissions to education agents their tuition fee structure is only sustainable if they cut corners on quality.

And quality is something we must not skimp on—for the sake of students, but also for the sake of our international education reputation and, more broadly, our economy. We must not allow the reputation of our education sector to slip. Last year, education export earnings generated $21.8 billion for the Australian economy. That level of earnings demands both serious investment from the government and serious regulation. We must ensure the sector is managed properly. Labor does support better protections for students, and a crackdown on dodgy practices. But we also have serious concerns about the implementation under this government. After all, this is not a government that covers itself in glory when it comes to competent management. Whether it is water, the NBN, the census, Centrelink or marriage equality, this government has shown it cannot be trusted to manage the details.

Students of failed institutions do have access to the VET ombudsman, if they are made aware of it, to assist with issues like transitioning their course to another facility. Establishing an ombudsman to help these students get justice was Labor policy at the last election, and we are pleased to have won government support in this parliament to see it established. Sadly, students accessing FEE-HELP at other providers have also been affected by the government's tightening of the VET sector. The government's decision to cull 478 courses from the list of those eligible for FEE-HELP assistance, whether students were partway through the course or not, has had real impacts. Students in affected courses have had to decide to either complete their course by paying the rest of their fees up-front, or to drop out and start something else while remaining liable for the FEE-HELP fees incurred for the abandoned course. There was no warning given and no time to make alternative arrangements. Teachers were affected too because their courses were suddenly up-front fees only, leading to massive drop-out rates. Some were left to carry the can, having personally invested heavily in expensive teaching materials. Irrespective of one's judgement of the value of a course, it's unfair to tell a student that their course is covered and then pull the rug out from under them. Our young people and our teachers deserve more respect than that.

Labor has repeatedly raised concerns over the jobs that will be lost, the students who will be disadvantaged and the career pathways that will be blocked if the government fails to implement reforms thoughtfully and with care. Labor is concerned that the methodology employed by the government to determine the eligible course list is too simplistic and blunt and the consequences for many students and providers are too extreme. The government needs to ensure that it continues to properly consult with the sector about the changes, and Labor is concerned that this is not being done. The government needs to ensure it is providing the higher education regulator with adequate resources to do its job. Labor believes the government has been negligent by failing to act on the rorting within the system for far too long. This bill goes some way to addressing that negligence, and that's why we are happy to support it.

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