Terri Butler (Griffith, Australian Labor Party, Shadow Assistant Minister for Preventing Family Violence) Share this | Link to this | Hansard source

I rise to contribute to the debate on the Higher Education Support Legislation Amendment (Student Loan Sustainability) Bill 2018. This is an unfair bill which attacks students and puts up further barriers to getting a university education in this country. It's not driven by reform principles; it's merely an attempt by the government to make budget savings. Consequently, I move:

That all words after "That" be omitted with a view to substituting the following words:

"the House declines to give the bill a second reading because it attacks students and would undermine the fairness of Australia's world-class student loans scheme".

This bill is yet another example of the Liberals' war on young people. Since they came to office, we've seen repeated attacks on universities and students through funding cuts and attempts to increase fees. It's always been part of the Liberals' agenda: cut unis and make students pay more. If it weren't for the strong opposition of Labor and the crossbench, as well as the community across this country, we would already have $100,000 degrees and real interest applied on student loans. This bill is yet another example of how the government is going after students.

The changes to HELP are part of the government's mid-year economic and fiscal outlook package of cuts announced in December. Unable to get their third higher education package of cuts through the parliament, the minister and the government resorted to a grants freeze as well as changes to the HELP income-contingent loan scheme. This sneaky, reckless, backdoor cut will see $2.2 billion ripped from higher education funding. According to Labor's analysis, this means $60 million from the ACT, $736 million from New South Wales, $15 million from the Northern Territory, $436 million from my state of Queensland, $160 million from South Australia, $58 million from Tasmania, $572 million from Victoria and $208 million from Western Australia. The greatest tragedy is that the cuts will effectively kill the demand-driven system in this country. Universities Australia say that because of the cuts almost 10,000 places will be underfunded this year alone. This means nearly 10,000 Australian students could miss out on their dream of getting a university degree. These cuts will particularly hurt in the outer suburbs of Perth and Brisbane and in Central Queensland, outer Melbourne and Western Sydney.

This bill proposes to enshrine the government's MYEFO attack on students. It would lower the HELP repayment threshold to $45,000 and change the way that repayment thresholds are indexed in the future. It's all designed to find savings in the budget and help the Liberals pay for their extraordinary $65 billion in tax cuts for the big end of town and the big banks. It's simply a recycling of their plans from last year, albeit with a slightly higher rate than the $42,000 rate previously proposed for the commencement of HECS repayments. Labor believes this new rate is still too low. It's still only around $9,000 more than the minimum wage. Very little work has been done on how the new payment thresholds intersect with the tax or social security systems. Young people are already faced with a range of pressures: an increasingly out-of-touch housing market; cuts to penalty rates; tax increases from this government and, in parts of the country, very high rates of youth unemployment. This bill adds to the Liberals' attack on young people.

In rising to speak on this bill, I want to congratulate Labor senators for their work on the recent inquiry on this bill, led by senators Jacinta Collins and Deb O'Neill. I'm glad Labor's senators showed up—there wasn't anyone from the Greens or the Senate crossbench there to defend Australian students. I know that, at least, the Greens party contributed a dissenting report. If you look at the inquiry transcripts, submissions and reports, it's pretty clear that there is very little support in the community for this bill.

I want to particularly congratulate the new president of the National Union of Students, Mr Mark Pace, for his contribution. Mr Pace said that recent data from the NUS and from Universities Australia on student finances found that two-thirds of Australian students lived below the Henderson poverty line and one in five students would regularly skip meals. Under the proposed new HELP repayment threshold in this bill, many students would have to start paying their higher education income-contingent loans back before they even graduate—that's income-contingent loans. How does this new threshold reflect private benefit from higher education when it's barely above the minimum wage?

The government should also note that its changes to the HELP repayments would disproportionately impact women. The government has not put enough thought into this point. Sixty per cent of all Australians with a HELP debt are women, and two-thirds of the Australians affected by the new arrangements will be women.

It was Labor that created Australia's world-class income contingent loan scheme. It was first called HECS, of course, the Higher Education Contribution Scheme, and was introduced by the reforming Labor minister for education Minister John Dawkins in 1989 and designed by Professor Bruce Chapman. It was introduced in order to fund a major expansion of the higher education system. When we introduced it, we said that it was fair that students who receive a private benefit from a university qualification should make a contribution to the costs of higher education. These changes were a result of a number of years of policy development and consultation. But how could you say that the private benefit of higher education is reached when you're earning only $9,000 more than the minimum wage? This new repayment threshold is a nonsense.

Unlike the Liberals, Labor has a proud record of higher education reform. It was Labor that moved Australia's higher education system from a small elitist model to the broad high-participation model that we have in this country today. One of the greatest achievements of Labor's last period in office was our further opening up of the higher education system in this country. In fact, and as Universities Australia has recently noted, it has been HECS, now HELP, in conjunction with Labor's demand-driven funding and equity and participation scheme, that has been responsible for low-socioeconomic status undergraduate student enrolments increasing by 55 per cent, from 90,467 in 2008 to 140,462 in 2016. Indigenous undergraduate student enrolments have increased from 7,038 in 2008 to 12,320 in 2016, a growth of 89 per cent. Enrolments of undergraduates with a disability have more than doubled from 24,311 in 2008 to 50,206. And enrolments of students from regional and remote areas have increased from 110,124 in 2008 to 163,292 in 2016, that's a growth of 48 per cent.

The MYEFO decision to kill off the demand-driven system will put a handbrake on opportunity in this country. A substantial amount of the enrolment growth in higher education has come from students who are first in their family to attend university, just like I was. Killing off the demand-driven system will have only a modest impact on the wealthy parts of Australia but it will hit the suburbs and regions hard, because that's where we've seen the biggest growth in university enrolments. This measure will kill aspiration.

The second proposal in this bill is to introduce a loan limit on how much students can borrow under HELP. Currently, students enrolled in Commonwealth supported places have no limit to the amount they can defer through the HELP scheme. There are restrictions on the amounts that students can borrow for full-fee places. The proposal in this bill would create a borrowing limit across all of the HELP programs—the VET Student Loans scheme, HECS-HELP and FEE-HELP. While Labor is not unsupportive of loan limits operating as price signals—it's something that we committed to doing in the VET Student Loans space at the last election—we believe that the proposal in this bill would have too many unintended consequences.

In a period of rapid change, we need to accept that more and more students will want to take on additional study throughout their lives. Lifelong learning is important, given the particular changes that we are facing in the nature of work and the nature of our economy. That's why Labor supports a system where students can defer the cost of further study, be it postgraduate or vocational. As our system becomes more dynamic and responsive to the changing needs of the labour market, more students will need to take various courses throughout their lives. They will need a menu of options—vocational education as well as higher education—throughout their working lives. We can't simply assume the old linear way our post-secondary education system operates will continue to serve us into the future.

The proposal for a one-off borrowing limit in this bill is clearly inadequate. Even the government senators recommended an amendment to this particular change. Labor wants to see a more dynamic model, which is better designed to support lifelong learning needs, which our economy needs.

Looking at the system of fees and loans in this country provides a timely reminder of the rising costs of getting a university education in Australia. Australian students already make the sixth-highest contribution to the cost of their degrees, as compared with other OECD economies. There are many full-fee courses that already go beyond the current FEE-HELP limits, and there are dozens of courses where students already pay more than $100,000. Many of the students enrolled in these courses have to ask their families for assistance to meet the fee loan gap. It's simply not good enough.

As we have seen before, loan limits can act as an incentive for providers to set their fees in line with the maximum borrowing limit. Labor doesn't want to see the rise of commercial, American-style student loans in this country. This bill does nothing to address some of the recklessly high fee-setting that goes on. While a loan limit would help the government with its budget, it doesn't do anything to ensure that students can get the support that they need for affordable education, both after school and across their working lives.

The jobs of the future will, of course, be very different from the jobs of today. With everybody living longer, we can expect people to have large numbers of career changes throughout their working lives. With economic transitions happening, that will also mean people being displaced from old occupations are needing to skill up for new jobs.

Young people born today will enter the workforce in 2040. We must ensure that we have a post-secondary education system that is fit for purpose. That's why I was delighted to join with our shadow minister for education and training and the Deputy Leader of the Opposition, Tanya Plibersek, and the shadow minister for skills, TAFE and apprenticeships, Senator Doug Cameron, in announcing that Labor, in government, would undertake a once-in-a-generation inquiry into Australia's post-secondary education system.

The time for an inquiry has come. It's been 44 years since the last major vocational education and training inquiry in this country. There's never been a full—holistic—whole-of-post-secondary inquiry in this country. We've certainly had a lot of inquiries in respect to higher education. We need to look at all of post-secondary education, collectively, so that we can see what we need to do to make it fit for purpose. As issues from the debate on this bill remind us, we need a system that supports lifelong learning. We also need a system that has a strong, vibrant public TAFE at the centre of our vocational offering and we need to ensure that we have a system where all students are treated equitably.

I want an Australia where a poor kid is as likely to go to university as a rich kid. I also want an Australia where a rich kid is as likely to choose TAFE as a poor kid. We need to have a system where we have high-quality, high-status educational offerings in both vocational and higher education. This bill does nothing to set up Australia for the challenges and opportunities of the future. As the Mitchell Institute has said, a majority of jobs in 2020 will require a post-secondary qualification. We need to boost investment in TAFE and university to ensure that we don't get left behind in the Asian century. We can't continue to go down a path of moving more and more of the cost of education onto the student. Deputy Speaker, I know that you are well aware of this and that you have a lot of students in your electorate who have high debts already.

This government, since it was elected back in 2013, has been trying to find ways to increase the debt that people carry in response to getting a higher education qualification. One of the first things this government did, after getting elected in 2013, was seek to bring in a package of 20 per cent public funding cuts for universities and full deregulation of fees for university degrees. The community, the opposition and the crossbench were able to defeat these attempts by the government to cut public funding and increase fees.

The next package, of course, you'd be aware, defeated more recently, was a 7½ per cent fee increase for students, a commensurate cut to public funding for higher education, then a further cut to public funding for higher education to increase the proportion borne by students, in terms of their own private debt and, of course, the reduction of the HECS-HELP repayment threshold in that legislation. The parliament fought off these changes, the community fought off these changes, and they were successfully defeated.

But now we're seeing this round of cuts. The government has bypassed the parliament. They couldn't be under any doubt about the parliament's view of their attempts to cut funding to higher education, yet that's what they're doing in this bill. They're doing it administratively, through freezes announced at MYEFO. It's $2.2 billion worth of cuts to higher education and, as I said, the measures in this bill accompanied those announcements. We can't have a situation where university gets further out of reach, where there's a failure to invest properly in TAFE and where students are left in more and more debt in order to get a higher education, particularly given most jobs in the future will need post-secondary education qualifications. The entire approach of this government to higher and vocational education in this country is wrong. It's why we oppose the government's reckless MYEFO cuts and why we oppose this unfair bill.

Kevin Hogan (Page, National Party) Share this | Link to this | Hansard source

Is the amendment seconded?

Mr Tony Burke (Watson, Australian Labor Party, Manager of Opposition Business (House)) Share this | Link to this | Hansard source

I second the amendment and reserve my right to speak.

Bert Van Manen (Forde, Liberal Party) Share this | Link to this | Hansard source

In the very brief time I have before 90-second statements, it's my pleasure to rise in this House and speak on the Higher Education Support Legislation Amendment (Student Loan Sustainability) Bill 2018. I agree with the contribution from the member for Griffith, to this extent: our higher education system is incredibly important for those who wish to, after secondary school, go on to higher education and a professional career and, equally, our vocational education training system is important in ensuring that we have the appropriate education pathways for those, as they leave secondary school, who want to follow a trade or a vocational career. I see, regularly, the opportunities that are created for those students, both through vocational education training and the pathways that they pursue with school based apprenticeships and other things, but also—

Kevin Hogan (Page, National Party) Share this | Link to this | Hansard source

The debate is interrupted in accordance with standing order No. 43. The debate may be resumed at a later hour.