Karen McNamara (Dobell, Liberal Party) Share this | Link to this | Hansard source

Put simply, the Higher Education and Research Reform Bill 2014 represents the most significant reform to Australia's higher education sector in a generation. The bill presents major benefits for students and universities. The bill before the parliament is the result of this government working closely with crossbench members who acknowledge the importance of this reform. The amendments within are the outcome of lengthy consultation and negotiation on the part of the Minister for Education and Training, who is steadfast in his determination to enhance our tertiary education sector and ensure accessibility for all. One measure includes the retention of the consumer price index for HECS debts rather than moving to the 10-year bond rate. This will reduce the financial burden on graduates who take time out of the workforce—for example, to raise children or for other reasons—and for those engaged in low-paid employment. We will also introduce an interest rate pause on debts for primary carers who are earning less than the minimum repayment threshold and are caring for children aged below five years. These two measures alone offer greater support for families where a parent has undertaken or completed tertiary education.

Changes in this bill recognise the challenges faced by families in juggling work, education and supporting their children. This is a good thing for new parents, and it strengthens and improves the HECS system, making it better than ever for our future scholars. The government's reforms are supported by the higher education peak bodies, and the need for reform has been acknowledged by the Business Council of Australia and the Australian Chamber of Commerce and Industry. Our commitment is to work with Australian universities to ensure a smooth transition to the new funding model through the establishment of a structural adjustment fund. This fund will assist higher education providers operating in markets where there is low capacity to immediately achieve significant additional revenue.

Another important amendment is the guarantee that domestic fees will be lower than international fees. This is a fair measure that will support domestic students to obtain tertiary qualifications. Importantly, the government will also ensure that university fees are monitored by the Australian Competition and Consumer Commission. As I stated in my previous contribution regarding legislation changes, the government is not increasing fees. Universities will have the freedom to determine their fees within a competitive market. Coupled with monitoring from the ACCC, this will ensure that fee prices are competitive and reflective of the institution and course provided.

This new legislation and way forward will be looking after all Australian citizens who hold higher education aspirations. We will establish a dedicated scholarship fund for universities, with higher proportions of low-socioeconomic-status students that will be funded directly by the Commonwealth. For the benefit of members opposite, I would like to emphasise the last point: the government will establish a dedicated scholarship fund to assist low SES students' access higher education. This is in addition to the existing generous Commonwealth Scholarship scheme that will see thousands of students from disadvantaged backgrounds as well as rural and regional communities provided assistance to attend university.

The 2011 census identified that in Dobell the average weekly family income was $1,294. By comparison, the New South Wales average is $1,477 per week. Over a year this means the average family income in Dobell is approximately $9,500 lower per family against the state average. While a family's income is in no way indicative of their capacity to succeed in educational aspirations, it can be an influencing factor as to whether a parent or school leaver enters into tertiary education. For students in Dobell, an electorate which exhibits a higher than average youth unemployment rate, this reform will enable young school leavers to receive the support required to study either locally or in neighbouring regions such as Sydney or Newcastle.

Since my election I have welcomed and encouraged opportunities to engage with schools in Dobell. I have done so because I understand that education is one of the greatest gifts given to a young Australian, a gift that is essential in shaping their futures and offering hope and opportunity for life ahead. As I have previously highlighted in my initial contribution to this bill, in Dobell only 50 per cent of students attain a year 12 qualification. Under the current system, students who do not achieve their Higher School Certificate and Australian Tertiary Admissions Rank face increased difficulty and less opportunity to attend university. With only 16 per cent of Central Coast residents possessing a tertiary qualification, it is essential that we open the door and encourage more people to enter into the higher education arena. This legislation strives to do just that.

I also previously discussed the future demand of university education on the Central Coast and how this reform would encourage private institutions and non-university higher education providers to establish themselves in our region. It is currently estimated that the Central Coast and Hunter districts have a shortfall of 7,600 university places. With significant population growth forecast for our region, this number will grow. I am currently working with state and local governments to progress the development of a new university precinct within Dobell to address this forecasted shortfall. This reform will see Commonwealth subsidised courses available in a market in which such courses are currently not available. Ultimately, as a result of a new university precinct in Dobell, we could host a diverse range of institutions. We could see a university campus, private college and TAFE facilities co-located in such a precinct. For the Central Coast this means increased access to world-class education facilities that will enhance the prosperity of our region for years to come.

The minister, in his second reading speech, confirmed why this legislation deserves the unanimous support of this parliament, stating this bill represents:

… at their heart Australia's future economic security and opportunities for students.

This is certainly true for the Central Coast and you must wonder and ask yourself why members opposite see fit not to support local students on the Central Coast. Members opposite have comprehensively failed to outline with any substance their opposition to this bill. What we have heard is duplicitous rhetoric from members opposite that fuels a baseless and misleading scaremongering campaign. Never before in this nation's history have members of this parliament fronted university campuses with the sole intention of discouraging engagement in higher education. And we hear from members opposite throwaway lines claiming this government has no commitment to the fair go.

These claims must be repudiate for this bill, in truth, significantly expands access to higher education by removing current limits on Commonwealth supported sub-bachelor places. Any Australian seeking to study an accredited undergraduate qualification will be able to do so with Commonwealth support. No longer will students who seek to enrol at private universities and non-university higher education institutions, including TAFEs, be locked out of accessing HECS. Our reform will also provide unlimited support for diplomas, advanced diplomas and associate degrees—important pathways into higher education for students who may not have obtained year 12 qualifications. This will broaden access to university courses and open the door for more skills based courses to be undertaken with Commonwealth support. I will vote to ensure that thousands of disadvantaged higher education students receive additional assistance to access a place at university and receive support for their living costs through the new Commonwealth Scholarship scheme.

Measures contained in this bill will see an additional 80,000 students per year receiving Commonwealth subsidies by 2018. These 80,000 students will include people from disadvantaged backgrounds, rural and regional communities and others who require additional assistance to complete their studies. A further 80,000 students who are studying in vocational education and training will benefit through the abolition of the 20 per cent loan fee for VET FEE-HELP. An additional 50,000 students will benefit from the abolition of the 25 per cent loan fee for FEE-HELP. Removing these loan fees will make the system fairer and will simplify and improve the consistency of loan arrangements for students and institutions. It also removes pricing inequity between public universities and other institutions, bringing particular benefit to students who choose to undertake higher level courses at institutions such as TAFE. In total, these reforms will benefit more than 200,000 students each year over the next four years.

Due to the economic vandalism of the former Labor government it is crucial we deliver sustainable expenditure outcomes now and into the future. This includes our higher education sector. In 1989 the Commonwealth supported just under 300,000 higher education places. By 2013 this number had almost doubled. The uncapping of Commonwealth supported places has seen a sharp rise in student numbers. By 2017 this number is forecast to reach 700,000. This year the government is providing more than $5 billion in HECS loans, and this will increase to $10 billion by 2017. We do this to support our students and to ensure that every Australian who seeks higher education has the opportunity to participate and achieve a qualification.

I would like to emphatically place on the record that HECS is here to stay. No Australian student will need to pay a cent up-front. Our education system is envied by the world. It is also a system requiring ongoing support from the government. For us to do so requires implementation of a sustainable system, where the costs of higher education are evenly and equitably shared between the student and the taxpayer.

These reforms will establish a fair and equitable repayment scheme where students repay 50 per cent of their costs and the taxpayer meets the remaining 50 per cent. Currently, Australian taxpayers are paying 60 per cent and students 40 per cent. Research indicates that over their lifetime graduates earn on average around 75 per cent or $1 million more than those without a degree.

As a government we face many challenges. Ensuring sustainability of our higher education system is one we must approach with the utmost seriousness and commitment. We must enact necessary reforms to ensure the long-term sustainability of our higher education system and we are determined to do so. In spite of the baseless scaremongering campaign members opposite have embarked upon, we are determined to pass this legislation and ensure this reform succeeds. We owe it to future generations of Australians to provide a competitive and successful higher education sector. There is no doubt that the current system is outdated. Without reform, we will see Australian universities become uncompetitive against international institutions. This government proposes reform to allow our universities the flexibility to respond appropriately to challenges, including student mobility, technological advancement and rapid innovation. This is in addition to the other benefits previously outlined in my contribution.

Those who oppose these reforms offer no alternative plan of action. They fail to even accept the reality of a changing global environment, which is increasing the strain on Australia's higher education sector. One thing that we do know is Labor has no plan. Labor were the ones who announced $6.6 billion of cuts to higher education and research when they were last in government. Labor were the party who left funding cliffs for research fellowships and infrastructure after the economic stimulus ran dry. Labor cannot be trusted with providing our universities with the resources they need.

The Leader of the Opposition proudly boasted that 2014 was defined by the force of Labor's resistance. Well, at what cost? Shamefully, some people are willing to trade away the educational future of so many Australians for a political catchphrase. I look forward to these reforms passing the parliament and I look forward to the benefits that will flow to students across Australia, particularly in my region of the New South Wales Central Coast.

These reforms will encourage renewed investment from higher educational providers and see more students engaged in higher education supported by the Commonwealth. Our economy will benefit from higher paid jobs, more innovative industries and more businesses as a result of a better educated workforce. The only concern for students should be the actions of members opposite, who have so recklessly threatened higher education with their misleading claims. These reforms are logical. These reforms are good and sound. Importantly, they are sustainable and equitable. Above all, they are necessary to securing our future competitiveness both at home and abroad.

In concluding, I quote from the minister's second reading speech: 'These reforms will allow our higher education to be the best in the world. It will ensure that future generations of Australians can get a world-class education to support them in the jobs of the future. It will provide the backbone of our future economy.'

I commend this legislation to the House and I call on members opposite to join me.

Gai Brodtmann (Canberra, Australian Labor Party, Shadow Parliamentary Secretary for Defence) Share this | Link to this | Hansard source

I am pleased to have the opportunity to speak on the Higher Education and Research Reform Bill 2014 and join with my Labor colleagues in standing against this terrible legislation—this terrible policy. We do so to protect higher education. 'We will ensure the continuation of the current arrangements of university funding.' Those were the words of Christopher Pyne, the Minister for Education, prior to the election. 'No cuts to education.' Those were the words of the Prime Minister prior to the election. This legislation is further evidence that the promises of those opposite are meaningless.

What does this legislation do? In total, the Abbott government's budget measures cut $5 billion from higher education teaching and learning, and university research. That is an awfully big cut from a government that promised again and again 'no cuts to education'.

Despite the government giving up on $3.5 billion of its $3.9 billion of savings, it has not fixed the inequity that lies at the heart of this bill. The bill still contains $1.9 billion in cuts to Australian universities. It still contains $100,000 degrees for undergraduate students. It still contains $171 million in cuts to equity programs. It still contains $200 million in cuts to indexation of grant programs. It still contains $170 million in cuts to research training. It still contains fees for PhD students for the first time ever. And it still contains $80 million in cuts to the Australian Research Council.

This legislation still slashes funding for Commonwealth supported places in undergraduate degrees by an average of 20 per cent and for some courses up to 37 per cent. This legislation still cuts indexation for university funding, costing universities $202 million over the forward estimates period. On top of these cuts, the government has stripped almost $174 million from the Research Training Scheme, which supports Australia's PhD students. This legislation also introduces fees for PhDs. The Liberals want the scientists and academics of tomorrow who are already giving up three years' income to pursue a PhD to pay for the privilege.

It is astounding to hear those opposite claim that this unfair education policy will not necessarily result in fee increases. Despite all the bluff and all the bluster on government benches, there is absolutely no doubt that fee deregulation will lead to substantial fee hikes. The University of Western Australia has already said it will charge all students $16,000 a year—more than doubling the cost of an arts degree overnight. We just have to take a look at other countries around the world to see that deregulation has not led to price competition and has not led to lower fees for students. In the UK, fees were deregulated in 2012 with a cap of £9,000. For the 2015-16 academic year, there will be only two universities out of 123 that will not be charging £9,000 fees. And now, just three years after deregulation, experts in the UK are saying their new system is unsustainable, finding that it, 'Represents the worst of both worlds where all parties feel that they are getting a bad deal' and 'Government is effectively funding universities by writing off student debt rather than investing directly in teaching grants'.

Let us look at the United States, where university fee rises are out of control and student debt now exceeds credit card debt. By how much would university fees increase under this unfair policy? According to Universities Australia, the cost of important courses like engineering and science will have to increase by 58 per cent to make up for the government's funding cuts. Nursing will need to increase by 24 per cent, education by 20 per cent, agriculture by 43 per cent and environment studies—in this time of climate change and the challenges that we have with climate change—will have to increase by 110 per cent. Labor will never support a system of higher fees, bigger student debt, reduced access and greater inequality.

Canberra is lucky enough to be home to several excellent universities, including the Australian National University, where I did my undergraduate degree, the University of Canberra, where I had the great honour of tutoring and mentoring students, and also the Australian Catholic University. There are over 30,000 Canberrans currently enrolled in one of these three universities, so it is not surprising that Canberrans are very passionate about this issue. Since the budget, I have spent a lot of time talking to Canberrans about what they think of it. I have been doorknocking. I have held community forums. I have held mobile offices. I have spoken to Canberrans about how the budget will affect them, and I have been inundated with emails, letters and phone calls from constituents who are unhappy with one aspect—or, in many cases, multiple aspects—of this government's horrendous budget.

Almost every single person I have spoken to has felt that the government's higher education policies are unfair and are an attack on our social fabric. In fact, I can be confident in saying that of the many people I have spoken to since the budget, more opposed the cuts to higher education than opposed any other single policy. That is saying something, because there are some real stinkers of policies in that budget—most importantly, the GP tax, which has had multiple iterations over the last six months, or last six weeks really, and we still do not know where we are at with that. I know that the cuts to Newstart were also of great concern to the Canberra community.

Of these people who are very concerned about these cuts to higher education, some of them—a lot of them—did not necessarily go to university themselves. But they do have aspirations for their children or their grandchildren to one day go. And they do have aspirations that one day they may become a mature age student. Sometimes they just simply believe that every Australian should be able to choose whether or not they go to university based on their interests, intellect, skills, talent, hard work and career goals, and not on their bank account.

I have heard these concerns from Canberrans, who had always considered themselves lucky to have such great universities right here in their own city, but who now fear that their children will never have the opportunity to study at these universities. Canberrans are united against the Abbott government's changes to higher education. They know that they will make university study inaccessible for people from disadvantaged backgrounds. They know that they will create a two-tiered system, where only the very rich can access our best universities—it is going right back to the fifties. They know that these changes will saddle our kids with enormous debts, preventing them from ever entering the housing market or getting ahead in life. They know that these changes will be bad for our country.

I want to read out a letter from one of my constituents that I received some time back, because this issue has been debated extensively over the last six to eight months. This constituent said:

What a nightmare the budget is! I understand that we, as a country, need to make changes to reduce our deficit and plan for the increase in cost in some areas of the future, but we are so disappointed that this budget is just so unimaginative.

The policy that distresses us most at the moment is the deregulation of the university fee structure and the resultant higher fees.

Please Gai we need you and your colleagues to do something about this terrible policy. What amendments can you propose, what parts can you block?

How will our young people ever be able to afford to buy houses when they will be saddled with an $80,000 debt? How will they afford higher degrees and what will it do to their general spending power. None of this can be good for the economy. We want to commend and encourage you in your fight for the best for this country.

As I said, that was received from one of my constituents some time back, but it echoes the views that I have picked up from doorknocking, from mobile offices, from community forums and from across the Canberra community.

A few months back I recently visited my alma mater, the Royal Melbourne Institute of Technology, where I was union president. I had the opportunity to meet with a number of engineering students, mainly, who had come from all over Victoria, and particularly from your electorate, Deputy Speaker Broadbent. I was shocked to hear from a number of students that they knew people who were planning to move to Europe to attend university, because even with the cost of moving to Europe and the cost of living in Europe, it would still be cheaper than studying in Australia. What also concerned me was the fact that these young engineers, these young men and women from your part of the world, Deputy Speaker, were looking at doing post-graduate degrees in engineering, but they were thinking about doing it overseas. They also made the very relevant point that Germany, particularly, has a manufacturing industry, whereas the future for manufacturing here in Australia is looking pretty dire because of a lack of support from this government. As a result of this, Australia will lose the precious intellect and potential of these bright young Australians. There will be a brain drain. I also believe these changes will result in fewer people doing post-graduate research, particularly when it comes to medical research.

My little sister is a neurologist. She does research in dementia and stroke. She is a very accomplished and internationally recognised neurologist. Her great concern is the fact that, with these outrageously expensive degrees, particularly at the postgraduate level, young Australians are not going to want to go into research because they are going to be burdened with such a debt as a result of doing their tertiary education and their study and laying the groundwork for a strong and successful research career. She is concerned at the fact that they will not be prepared to go into research, which is traditionally not a high-paying area. They will not be prepared to go into research for altruistic reasons, because they just will not be able to afford it, because of the high cost of their fees. Again, she is concerned about the brain drain, or the lack of creation of talent, in the research field, particularly the medical research field. So not only does this legislation potentially create a brain drain in Australia of engineers and others; it also creates a complete dearth of potential research talent.

Most of those opposite have defended these policies by talking up the scholarships that are part of this legislation. 'Lower income students won't be disadvantaged, because they'll have access to scholarships,' they have argued. In fact, the Minister for Education often claims that his higher education reforms will actually benefit students from low socioeconomic backgrounds because they include the so-called Commonwealth scholarships.

But, like so much of this package, the scheme is fundamentally flawed. The scholarship scheme will receive no Commonwealth funding. It is to be funded entirely by students. Under the scheme, universities will be required to direct 20 per cent of the additional revenue raised by higher fees to providing scholarships. Universities are being forced to slug students to pay for these scholarships.

The design of the fund is flawed in other respects too. The current proposal is that each university simply keep its additional revenue and direct this towards its own scholarships. Because the elite Group of Eight, the sandstone universities, will presumably be able to charge higher fees than their regional and outer suburban counterparts, they will have more money in their scholarship funds. This means that the universities with the lowest proportion of disadvantaged students will have the most money to support such students. Essentially, it means that these already privileged universities will be able to use the money that other students—including students from low-income backgrounds—pay to attract the best and brightest kids from regional areas. Meanwhile, the local university has to choose between raising fees for all to offer scholarships for some or watching talented students being lured away to the city.

Young people should not have to move overseas to pursue higher education. They should not have to choose between higher education and homeownership. They should not have to choose between higher education and starting a family. Under the Abbott government's plan, they will have to make those choices. Labor believes that no Australian, young or old, should be deterred from going to university because of cost. A decision to study should be based on intellect and ambition, not on your bank balance. This policy is bad for low- and middle-income earners. It is bad for rural and regional Australia. It is socially regressive and is, in fact, bad for all Australians and Australia.

David Gillespie (Lyne, National Party) Share this | Link to this | Hansard source

I would like to bring to the attention of the House a few basic issues that seem to have been lost in the rhetoric. First of all, I would like to talk about why this legislation, the Higher Education and Research Reform Bill 2014, is being brought in and what is different from its previous iteration—namely, what amendments have been put in place because of discussions with the university sector and with members in the other house. But I would just like to start to point out the hypocrisy of some of the members opposite and their scaremongering about fees.

Members on the other side talk about a place where university fees were in some utopian age where the government paid 100 per cent of student fees. I would just like to bring to the attention of the House that that is not the reality, and it has not been since 1989. We are changing things because the university and research sector is calling for these changes. The reality is that, since HECS was introduced in 1989, we have gone through a period where there have been vast numbers of students entering tertiary education who were not there before. Back in the mid seventies and eighties, there were much lower numbers of students at university, and the government did fund all the fees, but now we have a different system altogether. We have a demand driven system which has meant that hundreds of thousands more students are in tertiary education, and the growth of those numbers far outstrips the available funding.

As the head of the AT Network, which educates 150,000 students, says, universities have been in slow decline in funding since 1989. They have had their base funding cut away in a thousand little cuts, but I might just remind the House that, in 2012-13, members of the other side, when they were in government, had the audacity to cut $6.6 billion out of tertiary education and move it over into the Gonski initiatives. So it is a case of the pot calling the kettle black, yet again.

Secondly, the universities, almost in unison, want deregulation, as they see that their slow decline in funding is going to result in quality receding and their specialisation and their abilities being hidden in a very competitive market. The higher education market generates about $17 billion for the Australian economy, and it is hypercompetitive. Universities are growing in the subcontinent of India and in Asia, in Korea and Japan—all over the place. For us to maintain our quality product, the universities are saying, 'Please deregulate us,' with certain caveats: with deregulation and competition, diversity and subspecialisation of universities, rather than enrolling droves of people in undergraduate degrees that do not lead to quality or to employment as a secondary phenomenon—which is what we will continue to be. We are trying to fix that situation.

Many amendments were argued for last year, and with this bill we can see five key amendments that address the issues that the higher education sector, members of the Senate and the crossbenches argued for. The new legislation changes the interest fee back to the CPI rather than the bond rate. There is an interest rate pause for people's HECS debts if they are carers of children under the age of five, so when they are child-rearing at home and not working, their debt is not growing.

The legislation introduces a structural adjustment fund, particularly for regional universities, to cover the costs of transition and provide time to adjust to the new way the market would work. There is also going to be a dedicated scholarship fund for those particular universities, some of them in the regions, with high numbers of low-SES students. This dedicated fund will be in addition to the Commonwealth scholarship scheme that will be administered by the universities.

We have responded to criticism about the possibility of domestic fees matching the international fees, by stating in the legislation that domestic fees must be lower than international fees. To strengthen that, the ACCC will monitor university fees.

After a review concluded that the demand-driven system has given opportunities to hundreds of thousands of people who would not have gone to university under a system with a fixed number of students at university, the aim of this legislation is for the demand-driven system to continue. To fund increasing numbers of students in this demand-driven system, an initiative is to expand Commonwealth assistance to students doing diploma courses, advanced diplomas and associate degrees. We estimate that that will be 48,000 students a year and cost $371 million. Expanding Commonwealth funding to bachelor degrees at the non-university higher education providers will deliver assistance to another 35,000 students. That will cost $449 million. We are spreading the opportunity even wider from what it has been with the demand-driven system. How liberating is that? Those 80,000 students that were going to receive no help from the Commonwealth government will now get the opportunity to share in the benefits of Commonwealth-assisted higher education.

As I mentioned, the dedicated low-SES fund will be in addition to the Commonwealth scholarships that will be set up by the universities. Twenty per cent of the fees that they charge will have to be rolled into Commonwealth scholarships. We are also removing loan fees, which are quite considerable. That was a 25 per cent fee for FEE-HELP loans. There was a 20 per cent fee on VET FEE-HELP loans—and they are being removed. That will help a lot of people in that education demographic doing VET training courses. There will be alternative pathways to higher education through diploma, advanced diploma and associate degrees.

This legislation will also deliver certain funding for the National Collaborative Research Infrastructure Strategy. That will be 100 new research scholarships—PhDs; $26 million for research on dementia; $42 million for research on tropical diseases; and $24 million for the Antarctic Gateway Partnership. All of those will be funded with certainty. I must say the previous government left things in limbo there too. More students at university will be the reality. I know people on the other side, in their arguments, referred to $100,000 degrees and made all sorts of outrageous claims. But if you look at the actual peak bodies of the universities—whether it is the RUN group, Universities Australia, the Group of Eight, the TAFE directors or the Australian council of private education providers—they are all in support of the deregulation as long as we put these amendments in—and they have been included. So much for the $100,000 degrees!

The University of Western Australia has announced that the average cost will be $16,000 per year. Their most expensive degree, a 5½-year degree doing business law: $74,000 to $75,000—and that is for a 5½-year degree. Some of the other fees quoted from the council of private education providers are nursing from $11,000 to $14,000 per year and education degrees at $10,000 per year.

Sydney University is looking at expanding their Commonwealth scholarships sevenfold from less than 1,000. That is a vast increase in the number of scholarships available at a major metropolitan university. If you multiply that around the country—in Adelaide, Brisbane, Sydney and Melbourne—a lot of students that would have received no assistance will be eligible for these Commonwealth scholarships.

There are a lot of sensible adjustments that have been incorporated in this legislation. As I mentioned, the critical thing for people to realise is the universities are encouraging us to go ahead with this deregulation. We have a huge industry which is and was suffering from a slow drain long before this current government was responsible for administering education. It is a competitive world. The previous ALP government stripped $6.6 billion out of universities. This is a lifeline that the universities want. There will be many more students able to access Commonwealth help. All the lies and scaremongering have to be called out for what they are.

Sharon Claydon (Newcastle, Australian Labor Party) Share this | Link to this | Hansard source

I rise for the second time in this place to join with my Labor colleagues in opposing this so-called reform that the Abbott Liberal government seeks to force upon Australia. At the outset let me be very clear about Labor's position so as to avoid any misunderstanding or confusion. Labor will oppose the Higher Education and Research Reform Bill. We will do so because it is wrong. It is wrong for the nation, it is wrong for students and it is wrong for Australian families. It is inequitable and rotten to its core. Labor cannot support a higher education system of higher fees, bigger student debt, reduced access and greater inequality.

The first version of this so-called reform was rejected by the Australian public and the Senate and version 2 should get the same treatment. Despite being dressed up as a new and improved bill, version 2, the bill that is before the House today, still contains: $1.9 billion in cuts to Australian universities; $100,000 degrees for undergraduate students; $171 million in cuts to equity programs; $200 million in cuts to indexation of grants programs; $170 million in cuts to research training; fees for PhD students in Australia for the first time ever; and $80 million in cuts to the Australian Research Council.

Nothing of substance has changed in version 2. The massive cuts to universities remain, new fee imposts for students remain, and Labor's resolve to fight this bill also remains. I remind the House again that this is not a higher education policy that the Australian people have endorsed at any stage. This is not a policy position that the government took to the Australian people prior to the election. Put simply, this government has no mandate as is claimed. The first we heard of this government's plan to smash the very foundations of our higher education system was on budget night last year. Despite ongoing denials from the education minister that the government did not have a higher education policy before they were elected, it was in fact there for everyone to see in black and white in that now infamous Real Solutions catalogue. It was alleged in Real Solutions that a Liberal government would in fact strengthen higher education and encourage Australians of all ages to further their education so they could gain the comparative advantage to get ahead in the new global economy. Significantly, it was also alleged in the same Real Solutions document that current arrangements for university funding would continue. There was no ambiguity. This was a commitment to higher education that the government took to the last election. That is right—the Abbott Liberal government's documented commitment on higher education for the 44th Parliament was that current arrangements for university funding would continue.

Make no mistake, condemnation of the government's plans has been broad, it has been loud and it has been clear. But rather than scrap the reform after it was thrown out by the Senate, for the second time, here we are still debating a higher education bill that will increase the cost of university for students, increase debts for students and cut Commonwealth funding for universities. All the while, the government is spending millions of taxpayers' dollars to spruik their higher education changes to the Australian public.

It is unconscionable that this government and this education minister signed off on a massive advertising campaign, spending more than $14 million of precious public funds in a desperate bid to sell their propaganda about higher education reforms to the Australian people. That the Australian people had stopped listening to this government long before their advertising campaign began makes this expenditure even more wasteful.

The Leader of the Opposition made clear Labor's strong commitment to education during the debate on the government's first version of this bill when he argued:

Opportunity in education is a pact between generations. It is a solemn promise to pass on an education system that is better than the one you inherited.

He went on to warn this government:

You do not meddle carelessly with one of the great markers of life—and education is indeed one of the great markers in the line of life.

This government is breaking its pact with the Australian people and is recklessly tearing up the social contract that underpins our education system.

Labor believes in equality of opportunity. Labor believes in affordable, accessible higher education for all Australians. We will vote against the doubling and tripling of university fees. We will vote time and time again against this government's cuts to university research. We will never consign the next generation of Australians to a debt sentence. We will not support a system where the cost of university degrees rises faster than the capacity of society to pay for them. We will never tell Australians that the quality of their education depends upon their capacity to pay. Education is a birth rite in Australia, not a privilege for the few.

I have previously told the House about a woman in my electorate and her plans to return to study as a mature age student. Today I can add the next chapter to her story, with some good news, but not without some trepidation too. Last year she completed the Open Foundation program so she could attend university as a student for the first time. She has raised a family and worked in retail for more than a decade but wants to undertake university study to retrain and improve her future employment prospects. She knew it would be tough to balance work, study and family life but she was willing to work hard and thought getting a degree would be worth it in the long run. But she was concerned that this so-called higher education reform was a step too far. After this government announced their proposed changes, she became anxious about the level of debt she might incur. From her perspective, she already had a mortgage and could not afford another one. I am sure she is not the only woman asking herself, 'Is it really worth it?' She did, however, take the gamble, applied to university and was accepted to study this year at the University of Newcastle. When I congratulated her on being accepted to university, she replied, 'I'm a little excited about going to uni but not excited about the debt.' While ever this government's bill hovers over the higher education sector and the broader community, I know that many potential university students will be questioning their capacity to afford a higher education. For those enrolling this year, they have no idea of what their study will actually cost them. This is not a situation any student, prospective or otherwise, should be in.

The effect on students is just one side of the higher education debate. There is also the effect on universities and regional communities more broadly. My electorate of Newcastle is proudly home to a university ranked in the top three per cent of universities in the world and the University of Newcastle is one of the top 10 universities in Australia for research funding and teacher quality. The economic and social capacity of regions and regional cities like Newcastle is vastly improved by the research and innovation being delivered by world-class research intensive universities like Newcastle.

At the University of Newcastle, excellence is always coupled with equity; it is not in spite of it. The student body is representative of our broader region—lower than average socioeconomic status and often the first university students from their families. Nearly a third of enrolled students are from low-SES backgrounds, which is nearly double the sector average. When compared to the two Group of Eight universities in New South Wales, the University of Newcastle does considerably more to ensure equity of opportunity in our state. Some 24 per cent of students admitted to the University of Newcastle come from low-SES backgrounds, while the University of New South Wales and the University of Sydney, at 8.5 per cent and seven per cent respectively, are way behind. It is not the old sandstones that are doing the heavy lifting when it comes to access and equity. The University of Newcastle also has the highest number of Indigenous students in Australia and the highest rate of students beginning study through enabling programs rather than through the traditional pathways.

In the university's submission to the Senate inquiry into the first version of this bill, they stated clearly that they did not support the Commonwealth Grant Scheme funding cuts or deregulation of student fees and that research intensive universities based in regional areas, like Newcastle, James Cook University in Queensland or the University of Tasmania, were uniquely vulnerable to the changes proposed. These universities conduct research in high-cost disciplinary areas including engineering, science, medicine and health and offer associated premium degree programs which are recognised internationally and in high demand locally. Research in these areas carries high fixed costs and any funding cuts would limit the capacity of these universities to sustain the investment in infrastructure and talent required to deliver world-class research innovation.

The University of Newcastle emphasised that, if the government did continue to pursue student fee deregulation and cuts to Commonwealth funding of universities, a transition package would be needed that directly recognised the unique role of highly research intensive universities located in regional areas affected by disadvantage and that supported their continued delivery of critical world-class research and innovation in a newly deregulated environment.

I do note that in version 2 of this bill—the bill before the House today—the government has included a transition fund, but this fund is woefully inadequate and very poorly targeted. The industry calculated that some $500 million would be required to transition to a deregulated environment. The day that the first version of this bill was defeated in the Senate, the education minister told Universities Australia the transition fund would be $300 million. So you can imagine the dismay of universities when the second version of this bill proposed just $100 million for the so-called transition fund. The Regional Universities Network has said that regional universities alone will need $100 million each and every year, not so much as an adjustment package but rather a straight out acknowledgement that regional universities and regional communities will be the biggest losers if deregulation goes ahead.

Without adequate Commonwealth funding, funds will have to be sourced from the student body. While this bill would allow that to happen through deregulation, very few students would be able to meet the costs without enduring a massive lifelong debt. For regional universities like Newcastle, which draw a significant portion of their student body from lower SES regions, recouping lost Commonwealth funding from students will be near impossible, even with deregulation of fees. Regional students simply will not be able to afford to study high-cost disciplines and it will be difficult for research standards to be maintained with the loss of overall funding. Like my community, I fear these students will be lost to higher education altogether.

Under this legislation, non-university higher education providers, or NUHEPs, along with approved overseas universities, will now have access to student subsidies at 70 per cent of the rate for public universities. What the education minister whispers, but is loath to say loudly, of course, is that he is relying on these NUHEPs and outposts of overseas universities to deliver the cut price courses that he believes will cater for those students from low-SES backgrounds. Regretfully, I do not share his sense of optimism here at all.

What he fails to understand is that the for-profit institutions he is so very keen on will skim the cream from the public system, delivering the cheap courses and leaving the less popular or more expensive yet vital degrees to the public universities, which have a good public mission—disciplines like foreign languages, engineering and pharmaceutical sciences. These are all skills and expertise we need, but in fact they may well be lost in this new environment.

I also want to touch briefly on the government's proposed Commonwealth Scholarship scheme. Ignoring all of the evidence of higher fees and crippling debt, the education minister often claims his higher education changes will actually benefit students from lower socioeconomic backgrounds because they include the so-called Commonwealth Scholarships. This is possibly the cruellest con job in the whole package. Make no mistake: the government's proposed scholarship scheme will receive no Commonwealth funding—not a cent. It is to be funded entirely by students. Like so much of this higher education package, the scholarship scheme is fundamentally flawed.

Labor will vote against these cuts to university funding and student support. We will not support a system of higher fees, bigger student debt, reduced access and greater inequality.

Eric Hutchinson (Lyons, Liberal Party) Share this | Link to this | Hansard source

It is just all too hard for the Labor Party. How is it that you can take $6.6 billion out of the higher education sector and then, when a solution is offered that not only allows it to thrive and proper but also is something that is being demanded by the sector, oppose the solution? The hypocrisy of the Labor Party is writ large. It is so disappointing to see the standard of our public debate in respect of good public policy. I heard the member for Newcastle talking about equality of opportunity. The reforms in the Higher Education and Research Reform Bill 2014 will, more than anything, deliver for those kids who come from low socioeconomic backgrounds more opportunity than they have ever had—unless we want to go back to the 1970s when Gough Whitlam, in his wisdom, brought free education to the people. The difficulty with Gough Whitlam's reforms was that those students from privileged backgrounds who were finding themselves a way to go to university—remember, a lot fewer people went to university in those days—were the same people who had always been going to university. And who was paying for it? The tradespeople and the people working on the shop floor were the ones who were paying the fees of people going into higher education. We know that people who go on to higher education earn 75 per cent more over their lifetimes, roughly a million dollars more, than people who do not. Do not talk to me about fairness. Just what does it say? Once the sector is reformed, more students will have the opportunity to go on to higher education, and the regional universities will be the big winners. I spoke passionately on the original bill because I believe that this is not just good reform but necessary reform, and that is confirmed by the sector.

One aspect that I want to talk about is the exports. Seventy per cent of the Australian economy is services—whether it be tourism, health services, aged-care services, finances, legal services or education—yet only 17 per cent of our exports are in the services sector. This is the opportunity. The students who come in from overseas who are attracted to universities and higher education institutions in this country do so for one reason. Yes, the beaches are good; and certainly the University of Tasmania is located in one of the most beautiful places on earth. But they come here because the quality of the education they get for the price they pay is great value. They get high-quality education when they come to this country. But guess what? If we sit on our laurels, if we dine out on our reputation, we are going to be overtaken at a million miles an hour by countries to the north—whether it be India, Singapore, Hong Kong, China or Japan—because those are the countries where those students who subsidise and cross-subsidise all of the students in Australia to go university will go, and they will be jeopardised. This is why the sector is calling out for change. This is part of the reason we have been able to deliver the free trade agreements: for the first time we are going to see the opportunity to attract more students out of Japan, China and South Korea to study in Australia. We are not an island in this sense. Our higher education institutions are competing globally. All they are asking for is a chance to compete. We must reform this sector.

Only last week the Hon. John Dawkins AO—I do not know the man but I believe he was a member of the Labor Party—came out in support of the plan. And there was another one; I think it might have been the Chancellor of the Australian National University, Mr Gareth Evans. I think he was also a member of the Labor Party. They are supporting the plan. Another one is Maxine McKew, also a member of the Labor Party. She has come out in support. Even the shadow Assistant Treasurer has written it down in black and white. He also supports reform in the higher education sector. It is overdue, it is necessary and it allows the higher education sector to compete.

Opposition Members:

Opposition members interjecting—

Russell Broadbent (McMillan, Liberal Party) Share this | Link to this | Hansard source

I am not going to protect the member for Lyons from the abuse from the left-hand side of the chamber, because the member for Lyons has a reputation for giving it himself. It is a free-for-all, and I expect that there will be a robust exchange in the parliament.

Eric Hutchinson (Lyons, Liberal Party) Share this | Link to this | Hansard source

I touched on the article by Andrew Trounson before, titled 'Get over Gough', and I will not go back there. But I look at the way the minister has negotiated this. He consulted broadly—long before the budget that was apparently so unfair. There is nothing more unfair than stealing from my kids, I can tell you; but the minister has consulted with the sector. He engaged with the sector and they could not sustain more cuts. So we have come up with a package that is supported by the sector and that is all about getting more students in Australia into university.

I truly appeal to the crossbenchers because we are going to get no help from those on the other side. They are all complaint and no solution. But I do appeal to the crossbench senators. I appeal to my Tasmanian colleague, Senator Lambie. I noted comments that were made this morning, and I just say: former Senator Brian Harradine was not on our side of politics, Mr Deputy Speaker Broadbent, but you would have known him. What would Senator Brian Harradine have done in this situation? I ask Senator Lambie to contemplate. There was a man who delivered more for our state in the time that he was a member representing the state of Tasmania. He certainly would not have taken his bat and ball and gone home. He would have been in the minister's office, and he would have been talking to the relevant ministers about what he could get for our state. I strongly encourage her to take a leaf out of that book.

What about the scare campaign on fees? I have never seen anything like it. We will start with the Queensland University of Technology, with not a $100,000 degree in sight. You cannot find one. One of the best business law degrees—

Ms Butler interjecting—

The member for Griffith probably knows all about these things. One of the best business law degrees in the country: 5½ years and around $30,000. There is not a $100,000 degree in sight. Then we have the University of Western Australia.

Ms Claydon interjecting—

I acknowledge the comments made by the member for Newcastle about the quality of her university in her town. It is fantastic to hear that. The University of Western Australia is one of the top 100 in the world—and it is $16,000 a year for a three-year degree. It is not $100,000, is it? No.

Opposition members interjecting—

The hypocrisy! I cannot use some words in this chamber and I will not, but it is indeed frightening.

Opposition members interjecting—

No up-front fees. Not one student in Australia going to the university of their choice will pay one cent—not one cent, and this is fantastic.

More of my colleagues will talk more about this, but 80,000 more students will have access to higher education institutions in our country as a result of these reforms. Regional universities will be the big winners. Take for example the university in my home state of Tasmania. It is the biggest employer in the state of Tasmania. It is a university that can also compete at the research end. It is capable of attracting research dollars for things like marine and Antarctic studies. I note the member for Lyne made reference to some of the money that the federal government has contributed to those research efforts. Fundamentally—certainly in northern Tasmania, certainly in the campus in Launceston and certainly in the campus in Burnie—the high proportion of students that first engage with this wonderful institution are going through pathway courses, sub bachelor degrees and the like. It is those courses that will, with these reforms, now be able to access the HECS loan scheme, which is a truly a generous scheme.

I will give an example of the capacity of the University of Tasmania to be able to keep up. I have mentioned this before. The third-largest course they have at the University of Tasmania is their degree in dementia care. It has been born out of their MOOC, which is an online free course there. They have identified a gap in the market. And, I can tell you, with the free trade agreement we have just signed with China there will be huge opportunity for our capacity now that we are able to own and operate profit-making aged-care facilities, childcare facilities and hospitals in China. As a result of the free trade agreement, there are going to be huge opportunities for increased training of those people who will staff those facilities in China. This is why this is so important.

We are talking about multiple campuses. I sort of believe in competition. You have got the University of Tasmania—a fine institution. Yes, it has some challenges. We understand that, and that is the conversation that I have been having with the minister—a conversation I would encourage Senator Lambie to have with the minister—in terms of Burnie and the Launceston campuses and how they could be assisted. Tell me if I am wrong, but you have got a monopoly institution, you have got a captive market and you have got a high-quality provider. Heavens above, if they cannot compete in this environment I will give it away, and I believe they absolutely can.

Regional universities can be the big winners, because what you will see is reverse migration. If the University of Melbourne prices themselves out of it, and even if they did have $100,000 degrees, students will be able to judge whether that is good value for money or whether they are better off doing the course at the University of Tasmania or even the University of Newcastle. This is what we will see. You will see this happening, and that is really exciting for regional universities in Australia. There will be more scholarships for students from low-SES backgrounds. I note also the University of Sydney—

Ms Butler interjecting—

Russell Broadbent (McMillan, Liberal Party) Share this | Link to this | Hansard source

Member for Griffith!

Eric Hutchinson (Lyons, Liberal Party) Share this | Link to this | Hansard source

They have been outrageous, Deputy Speaker, but we are up for it. I do not know where the University of Sydney stands in the ranking, but I am pretty sure they would be in the top 10, 15 or 20 in the world. The University of Sydney have already stated that their scholarships—now wait for it, Member for Newcastle; hold onto your seat—will go from 700 places to 9,000 places. Just contemplate that for a minute. That is for kids from low-SES backgrounds—the very ones that you were rightly sticking up for, and the higher proportion that do end up going to the University of Newcastle currently. We might have a complete reversal. You might have all the really wealthy smart kids going up to the University of Newcastle and all those low-SES kids from Newcastle coming down and doing degrees at the University of Sydney. What a result! This is a fantastic thing.

It is indeed one of our nation's biggest export earners. The cross-subsidies that we get from international students are absolutely critical. It is the reason that education in this country is very reasonably priced. Our markets do work. I mentioned that there is no lack of competition within the higher education sector in Australia. I will be damned if anyone is going to tell me that if there is not good and high-paid employment opportunities there. If somebody is paying a little bit more for a degree, they will make a judgment and the market will actually make a judgment. There is no shortage of supply of providers within this sector. If there was, some of the arguments that are being made by those on the other side may have some resonance.

In summary, these are true reforms. I started by saying that I have been in this place only a short time. I guess we all come into this place believing we can make a difference. This is true reform. This is about the future of our country. This is about enhancing one of our natural competitive advantages and being a leader.

Russell Broadbent (McMillan, Liberal Party) Share this | Link to this | Hansard source

Order! The debate is interrupted in accordance with standing order 43. The debate may be resumed at a later hour. The member will have leave to continue his remarks at that time.