Tuesday, 25 May 2021
Tertiary Education Quality and Standards Agency (Charges) Bill 2021, Tertiary Education Quality and Standards Agency Amendment (Cost Recovery) Bill 2021; Second Reading
That all words after "That" be omitted with a view to substituting the following words:
"whilst not declining to give the bill a second reading, the House notes that the bill places a further impost on universities as they continue to face an unprecedented crisis as a result of the COVID-19 pandemic, during which the Government has failed Australian university students and staff by:
(1) excluding universities from COVID support; and
(2) making it more expensive for thousands of Australian students to get a university education".
Labor opposes this attempt to add another cost to Australian universities. After the year that our universities have just experienced with huge losses of revenue, thousands of jobs cut across the country and shamefully little support from the government, now is the very worst time to be adding greater costs to higher education, particularly through legislation like this, with all of the detail in regulations still to be released and with little transparency or legislative accountability.
These bills would establish a new charge to recover costs associated with the monitoring and oversight of higher education providers. The Tertiary Education Quality Standards Authority, TEQSA, is Australia's quality assurance and regulatory body for higher education providers. They do important work. They make sure providers meet the very high standards we expect from them. They make sure that we offer an education that all students, local or international, can trust.
This legislation would give TEQSA the capacity to collect a new provider charge. It would move its operations from a partial to an almost full cost-recovery model with a new annual levy for higher education providers, as well as increased application charges. Importantly, the key details of this change will be established in regulations, including the charging guidelines. As such, this will be a new cost of universities and higher education providers with little transparency about what will be involved in practice.
Labor opposes this legislation because, frankly, universities have copped enough over the last 18 months. Every time this government has a chance to chip away at universities, it seems to cherish that opportunity—another levy here, doubling of student fees there, cutting the government's share of the cost of educating students. When the sector needed support in the middle of a recession—a deafening silence. You can see why people in our universities feel abandoned—that is, the students and the staff. The government is spraying money around to fix the political problems of its own making but can't bring itself to give universities a scrap of help; instead, this Prime Minister wants to burden them with new costs. The legislation would make things harder for operators in every corner of the country. For big public universities, the annual levy system would mean that the lowest risk providers would still carry the greatest cost burden. This goes against the regulator's existing principle of variable risk based charging. For private providers, the increased application fees, which in some case are estimated to rise by 700 per cent, could threaten their financial viability entirely. For smaller organisations, this could be ruinous.
The decision to make these changes now, when the challenges facing universities are well known, symbolises this government's attitude towards higher education. Whenever there's a choice between helping universities and making life harder, they put they boot in. Look at the record over recent years. In last year's recession, no other industry of this size was treated with the contempt that universities were shown by the Prime Minister. This is an industry that employs 260,000 people, and it has been left for to fend for itself. When the government was stepping in to help other industries keep workers in their jobs, it deliberately excluded higher education. Public universities were carved out of JobKeeper subsidies, and just to make it clear this wasn't an accident—
Mr Tudge interjecting—
The member for Sydney will just pause for a second. I will say to the minister: there's no need for interjections. He's actually the only person in this place who has a right to sum up the bill and make whatever criticisms he wishes to make then. The member for Sydney may proceed.
Maybe instead of trolling, he could actually fix the problems. Just to make clear that it wasn't an accident, the rules were changed three times to exclude our public universities from JobKeeper. The Prime Minister sat by and watched as thousands of Australians lost their jobs without raising a finger to help. He sat by and watched while hundreds of jobs were lost in cities like Armidale, Rockhampton and Geelong—jobs that those regional towns depend on—and he did nothing. We are talking about our fourth-largest export industry. It doesn't make any sense.
Why would you stand by while academics and tutors and admin staff and librarians and groundskeepers and maintenance crews lose their jobs in our cities and in our regional towns? It doesn't make any sense until you realise that this government has an ideological crusade against universities. They actually want a weaker university system. It's part of their crusade against universities, and collateral damage, those jobs lost in regional towns, apparently doesn't matter. Higher education is obviously important for those people who are working in our universities. It's obviously important for the students who are depending on a strong university system to get them the skills and qualifications they need to do the jobs that will provide them an income for the rest of their working lives. But it's also important for all of us, for our national prosperity, to have a strong university system. All of the evidence tells us the same thing, that the more skilled and educated our workforce is, the more prosperous we will be as a nation.
We've seen just how vital our universities are, particularly over the last year: epidemiologists, public health officials, nurses and doctors, not to mention the scientists and the vaccine researchers, who've made our return to normal possible. We've relied on trained Australians to get us through COVID-19, and we will rely on them to drive our economic recovery, and not just our recovery—not a snapback to how things were before—but a push to build back better.
Before the pandemic, we know that productivity was stagnant. We know that wages growth was stagnant. We know that as a nation we were struggling with business investment and economic growth. Worse still, labour productivity was going backwards for the first time in 25 years. We didn't have a thriving economy before COVID-19. It wasn't a country putting our best resources to use.
We know that one of the most effective ways of improving productivity is investing in education, and that's from early childhood education through to schools and TAFE and university. Investing in education is critically linked with improving our productivity as a nation. In 2015, research by the Deloitte Access Economics group placed the value of universities to Australia's productive capacity at $140 billion. At that time, Deloitte also estimated that we would need an extra 3.8 million university graduates by 2025.
We need those graduates across academic disciplines: science, education, engineering, medicine, the humanities and law, just like we need more highly skilled TAFE graduates. This government tries to pretend that we've got to make a choice between a strong, great, well-funded university system and a strong, great, well-funded TAFE system. We don't. This country needs both. If we're building a bridge, we need the engineer to design it and we need the concrete form worker and all of the other trades to build it. Our education system needs to see both technical and vocational education and university education working hand in hand for our national prosperity.
But that is not the government's agenda. In fact, the government decided in the middle of a recession to make it harder and more expensive for Australians to go to university. That's what their so-called job-ready graduates bill did. It's another typical 'name it and they will come' approach to legislation from this government—a typical exercise in marketing and spin. In this job-ready graduates bill that the government's trying to sell as somehow encouraging people to go into particular disciplines, what you find is, in fact, 40 per cent of students will have their fees increased to $14,500 a year—40 per cent of students. I particularly feel for those kids who were in lockdown trying to finish their school education by remote learning, with their hearts set on studying something at university. They'd been talking to their careers adviser since year 9 about what they wanted to study at university to help them get their dream jobs. Can you imagine what a kick in the guts it was for these young people—and their parents and everybody who loves them and supported them through that difficult year of COVID-19 when they were doing their final exams—to be told that the cost of the degree that they had their heart set on has more than doubled? That is what this government—
As the member for Cowan says, that legislation should be called dream taker, because this is what, in effect, this government is delivering for young people: American sized university debts hung around the necks of Australian students. These are debts that will continue to hang around their necks, making it so much harder to save a deposit for a home. Think about these young people with close to $60,000 worth of debt for, say, a three-year arts degree with a year of honours. They are graduating with $60,000 worth of debt at the same time that housing is becoming increasingly unaffordable, and at the same time they are trying to start a family and childcare costs are through the roof. On top of that, they're going into a labour market that is less certain and less secure. Wages have been flatlining, so university costs keep going up. Their debt goes up but their wages continue to flatline. It really is such a tough start to adult life for so many young Australians.
When the Prime Minister announced those so-called 'job-ready' changes, he said that they would promote the study of engineering and science—in fact, that was the stated intent of these changes. The entire purpose of the bill, apparently, was to channel people into studying engineering, maths and other selected areas. But, as you often get with this Prime Minister, you only need to scratch the surface, dig a little bit deeper, and you see a very different story. When you look at the detail of the fee changes from this government, you find that, in the academic areas the government says that it wants to encourage young Australians to pursue, universities actually receive less money to teach students in those disciplines. In the areas that the government says that it wants to discourage students from going into—and, for a start, just think about the government saying, 'We want you to study this and we don't want you to study that'—the universities will actually receive more money to teach students in those areas.
Who could actually spend all this time and energy designing a package that puts those kinds of perverse incentives into the funding arrangements? Because of this government, universities will receive 32 per cent less to teach medical students. They will receive 17 per cent less to teach maths students. They will receive 16 per cent less to teach engineers. They will receive 15 per cent less to teach clinical psychology. They will receive 10 per cent less to teach agricultural students. They will receive eight per cent less to teach nurses. How do you come up with a mess like that, if you say you want to encourage people into these disciplines? When you cut the money that supports engineering and science courses, either you're actually going to get lower-quality courses or you're going to have universities changing their offering to students. You'll get fewer scientists and you'll get fewer engineers from a failure to support these departments.
This legislation really shows such a shockingly bad contrast between what the government says it wants and what it does in practice. The government says: 'We want more young Australians studying STEM subject. We want more people going into science as a career.' So do I. I think we all think that's a great idea. So why, if you want more young people choosing a career in science, would you cut research funding? We have thousands of researchers, including brilliant scientists, hanging up their lab coats and walking out of their laboratories for the last time because their grant funding has dried up. The funding has dried up because the international student revenue that used to fund research in universities is drying up; it has gone. On what planet do you say, 'We want more young people studying to be scientists' and, in practice, make it impossible for them to continue their research careers here in Australia? If we're worried about a brain drain—and we should be—we should stop sending these mixed messages to our brilliant young researchers. We should stop saying, 'We want more of you to dedicate your lives to discovery and innovation and invention' when, in fact, we're making it impossible for them to put a roof over their heads and bread on the table for their families.
That's the background to these bills, a government that has spent eight long years systematically undermining our university system. They started by trying to introduce those $100,000 degrees. We stopped them the first time because of overwhelming community opposition. They have just continued down this line of making it harder and more expensive for young Australians to get an education. They've tried to cut overall funding, Commonwealth funding, to universities three times. They've spent the pandemic watching on, sitting on their hands as thousands of university workers lost their jobs, without giving any meaningful support. They've doubled the cost of degrees for thousands of Australians. And, now, just as universities are struggling to make it through the worst of the downturn in their budgets, the government are trying to claw revenue back through this new charging regime.
There is very clearly a pattern here. It is a malicious pattern. Labor opposes this bill. It is not the time to be adding further cost to universities—not after universities have just spent a year trying to survive with no support from their government.
I thank the member for Sydney. The original question was that this bill be now read a second time. To this, the honourable member for Sydney has moved as an amendment that all words after 'That' be omitted with a view to substituting other words. If it suits the House, I will state the question in the form that the words proposed to be omitted stand part of the question.
It's a pleasure to rise today and speak on the Tertiary Education Quality and Standards Agency (Charges) Bill 2021 and the Tertiary Education Quality and Standards Agency Amendment (Cost Recovery) Bill 2021. I've heard all of what the member for Sydney had to say in her contribution, and I would say that the notion of cost recovery by various government agencies in the areas that they regulate is something that has been done many times elsewhere. I think it is more than a fair reflection that this government first announced these changes in the 2018-19 budget, but deferred putting those changes in place in the context of the COVID-19 pandemic. But, at some point, we need to proceed with what we proposed in the 2018-19 budget.
The important role of TEQSA, as the nation's independent national quality assurance and regulatory agency, is to ensure that they protect student interests and the reputation of Australia's higher education sector—and all organisations that offer higher education qualifications in or from Australia, as we know, must be registered. As I said, this delayed introduction of the increased cost has been for several reasons but is particularly due to the COVID-19 pandemic. Importantly, when I look at other industries that I have an interest in—financial advice being one of those—I look at the very significant increases in cost recovery that ASIC has recently levied on financial planner across the industry, in what has been a difficult time for them as well, which has put significant pressure on them. So the argument that we shouldn't pursue the recovery of costs for the agency, in my view, doesn't hold water when we see that it has been done in other sectors.
Currently TEQSA's cost-recovery levels are probably around 15 per cent of total costs, and the taxpayer currently bears the burden of funding for the vast majority of it regulatory activities. The increased cost recovery will involve increasing the application base fees to recover the true cost of these activities. The increase to the application based fees will be enabled by a new fees determination to be issued. The introduction of a new annual charge on higher education providers to recover the cost of the risk-monitoring and regulatory oversight activities and the new annual charges are the subject of these bills.
As I outlined, TEQSA's role is important. There are some 1.5 million students studying in Australia's higher education institutes, and in 2017 the sector had a revenue of almost $38 billion. We're fortunate in this country to have a world-class tertiary education system and, by extension, vocational education sector. We have a large number of our universities who appear in the Times Higher Education World University Rankings and six of them feature in the prestigious top 100. The University of Queensland ranks at No. 62 on that list and at No. 4 in the top Australian universities. I am pleased to say that, more locally to me and also to the member for Rankin, the Griffith University's Logan campus does a tremendous job and is located just outside of my patch in the member for Rankin's electorate. But many of those who live in my electorate—in the Logan area but also in the southern part of my electorate, in Upper Coomera, on the northern Gold Coast—would go to the Griffith University campus on the Gold Coast. I regularly have conversations with the leadership of both campuses about the terrific work that they do in helping their students, across our community, to realise their dreams of getting a degree and pursuing a career, whether it's in health, medicine, business, education or even politics. Griffith University is one of the great examples of the higher education facilities provided across this country.
This commitment to excellence is why this bill is important. We need our Tertiary Education Quality and Standards Agency to be well funded, and it is appropriate that the sector themselves have a higher stake in contributing towards these costs. As I've outlined a couple of times, there are a number of other industries in which we do exactly this. These changes will enable a new annual charge to be collected from registered higher education providers to recover the costs of their risk-monitoring and compliance-monitoring investigations, compliance management, stakeholder engagement and other regulatory activities. These costs are currently not recovered and are borne by the taxpayers. They will be phased in over three years to moderate the impact. The amendments in this bill will require higher education providers to pay the annual charge as and when it falls due, including any penalties for late payment. Failure by a higher education provider to pay the charge will constitute a breach of its conditions of registration.
Despite what the member for Sydney had to say—and what I suspect some of those opposite who are going to contribute later in this debate will say—this government does care about education. We've delivered record funding for education in our schools sector since we've come to government. Recently I was speaking with one of our local Indigenous groups, the Beenleigh Housing & Development Company. Several years ago we provided them with a $750,000 grant to ensure that they can provide the backbone support needed for families in our Indigenous community, for their jarjums, or kids, to be engaged at school and to allow them to take further studies at university. We do recognise and understand the value of education and we know how important it is to have a high-quality tertiary sector.
Our budget commits $9.4 million in 2021-22 to provide grants of up to $150,000 for eligible higher education and English-language providers to support innovative online and offshore education delivery models. We're extending the existing FEE-HELP loan exemption by six months to reduce the financial burden for eligible students. We are lowering the eligible fees and charges for smaller education providers registered with TEQSA from 1 January 2022, as part of the revised cost-recovery arrangements. We're also providing $1.1 million over two years from 2020-21 to create new employment pathways for students and boost financial incentives for universities to enrol students in industry PhDs.
That is something that I find particularly pleasing, because I think—from when I go out and talk to the business community and to people at our local university campuses—that it is one area where we can do a much, much better job. That is the intersection of academic education with practical, on-the-ground work experience in the businesses that students are studying their degree for. I've had a number of discussions with businesses and the universities about exactly these sorts of models, because one of the things that we see is that, despite the quality of the academic education that our students are receiving at our universities, at times and in certain courses it lacks the practical application on a day-to-day basis, and employers find that, when they get graduates, there is still a lot of work to do with those graduates to bring them up to speed on the practical application of what they've learnt academically.
I am going to continue to work with industry and our local university campuses to ensure that we can continue to develop those relationships and build those bridges between the academic work students are doing at university and the practical skills they need in the industry. I think that will benefit the students greatly. I think it will benefit the universities, and I also think it will benefit business. A lot of people in business maybe haven't had a lot of recent interaction with our universities and what they're teaching. Equally, there are times when what is being taught at universities is maybe not up to pace with what's happening in industry. I think this is one of the areas where we can do an awful lot more work to make that much more effective.
I'll give a local example. I recently met with the owner of SDI Plastics in Beenleigh. SDI are incredible innovators, supplying moulded plastic products through a process of design, tooling and injection moulding. They are looking at engaging a PhD student to work on a project with the University of Queensland that involves plastic waste and recycling and the use of home-compostable plastic made from biologically based and sourced bacteria. This is an exciting project that could be completely transformational for the plastics sector, and it is a terrific example of what I've just spoken about—the tertiary sector partnering with the business sector to jointly innovate. I commend this bill in its original form to the House.
I rise to defend the sector that I spent much of my working life in, starting out as a research assistant on a project to remove landmines and unexploded ordnance in Afghanistan and moving on to become a senior lecturer, then a course coordinator and eventually a researcher and professor. I've pretty much done it all at universities, including writing new units and courses, getting accreditation for new courses, and dealing with the processes for accreditation and quality assurance at universities. I stand here to reiterate the stance of the member for Sydney and shadow minister on this: Labor does not support this bill.
This bill, the Tertiary Education Quality and Standards Agency (Charges) Bill 2021, seeks to establish a new charge to recover the cost of TEQSA's regulatory activities. The previous member really encapsulated what those opposite think about this bill. They see it only as a cost-recovery exercise. What they don't see is the other impacts this so-called cost-recovery exercise would have, after the horror year for high school students who want to go to university, after the horror year for universities, after the horror budget for universities—as the vice-chancellor of the ANU described it—and after a long and protracted campaign by this government to decimate the higher education sector and bring it to its knees.
We oppose this bill not because of its cost-recovery element but because now is not an appropriate time to recover costs and hit a sector that is already suffering and hurting—not just from COVID but from this government's ideological battle against higher education. The sector has experienced job losses of 17,000, and there was nothing in JobKeeper or JobSeeker for those who worked at universities as casual lecturers. I know those people. They were my colleagues. I had to watch them lose their jobs and have nothing. The budget that was handed down last week means that real funding for higher education will fall by 10 per cent over the next three years. We've got cuts to fundamental research.
The government like to talk about innovation and commercialisation. What they need to understand is that commercialisation and innovation doesn't happen without applied research. Applied research doesn't happen without fundamental research, and what's happened to fundamental research lately at universities? You've got people walking out of the science labs, hanging up their lab coats—as the member for Sydney, the shadow minister, said—and walking out, because there are no jobs. Australia is suffering a brain drain. It will continue to suffer a brain drain.
I have witnessed researchers with years of experience and some really fantastic cutting-edge research who just cannot get a break here in Australia. The research settings and the lack of research funding here in Australia has meant that they have gone overseas to commercialise their research and to continue their research in partnership with universities overseas where they do have a significant amount of funding, because their governments recognise the value of research funding and recognise the value of higher education. They know that innovation starts with the fundamental research that's being undertaken in universities.
But with all of that—perhaps the biggest thing—is that you've got young people who have a dream. We all had dreams when we were young. Now they're looking at $60,000 of debt by the time they leave university, all given to them by a government whose members benefited from a free education. I don't know what you'd say about that, Deputy Speaker Mitchell, but I think that's just deplorable.
We've got a government here that's just racked up $1 trillion of debt in a big spending budget. They threw around the chocolate and the candy. But it's not that they're not giving anything to higher education; it's not even that the budget didn't even include anything for higher education and research. It's now that they want to take away from them, that they want to start cost recovery at a time where they have brought universities, higher education institutions, to their knees.
Now is not the time to talk about cost recovery. If you only see this measure in terms of economics—in terms of cost recovery—without putting it in the context of a decimated university sector with lower student numbers, with students who can't afford to go to university because the fees are higher, with fewer resources, with less funding for research, with fewer staff and with huge job losses then you are looking at the wrong place; you are looking at this through the wrong lens. So I along with the shadow minister and Labor do not support this bill. Now is not the time. This government needs to demonstrate to the university sector, to young people, to researchers and to innovators out there that they care about what they do and that they want real reform to the sector, not just a cost-recovery exercise.
Firstly, I direct my remarks to the former speaker's remarks. I'll go backwards through what she said. The historic changes to tertiary education were brought in by a Labor government, under John Dawkins as minister, to allow many more students to participate in the university sector. This was a massive change for Australia at the time. It was supported by both sides of the House at the time. So we can't historically stand here today into this broader future and say that this government brought this change in, because this government didn't bring this change in. That's incorrect.
Mr Hill interjecting—
That's not the point. The whole theme of what we're talking about today is about this sector. Remember: these changes were brought in by a Labor government, under John Dawkins at the time, and heralded as a breakthrough for tertiary education for ordinary students across the board in Australia. That's how it was argued.
Mr Hill interjecting—
Yes, for the lowest percentile also, because they also received scholarships. Those opposite would well know the history of all of this, because both of the members in parliament today have been through the process and know the history. Let's just leave it at that, for a start.
Then the criticism was that this is just a cost-recovery exercise. No. You would all admit that these are difficult times. So, what are the opportunities around this adversity that we face? The opportunities are to deliver the best tertiary education that we can in the circumstances we find ourselves in. I think the intention of government, and I believe the intention of the opposition, would be to do exactly that: given the circumstances that we find ourselves in, how do we progress this sector? The shadow minister made the point, saying that we need to train these people for our future recovery. Education is one of the major keys to that future recovery—a key for the thousands and thousands of people we're going to need to be trained to fill the jobs and to fill the expectations for new innovations. We need people who are smart, proactive and perceptive of what's going to be needed into the future. It's not about what we're doing now; we probably have no perception of the type of education that they're going to need to deliver future outcomes for this nation.
And it has to be our own people, because, right now, we're not getting the influx of skilled immigration that can fill those positions, and we don't have our own people trained to do particular jobs. COVID has been catastrophic. It has had catastrophic consequences for the tertiary education sector, and there was nothing in the power of government to do any more than that which we have done. Each sector has to take responsibility for where it finds itself.
There are no increased costs for students here. If you then say, 'No, that's wrong,' well, that means the private providers and the public providers would then be transferring a charge levied on them to recover these costs—at $1 per student, it would work out. That would look like it was a pretty ordinary thing to do to a student, at $1 a student. I think that's not on, and I don't think that the tertiary education sector would do that. So there are no increases in costs for students.
What has to be our focus all the way through this, as I have just mentioned a few minutes ago, is that those students are our future creative opportunity. If that is the case, and we believe that to be the case, we have to provide the best student outcomes possible. Since these opportunities have been taken outside the public sector into the private sector, have there been problems for the last 15 years? Absolutely there have been problems for the last 15 years. Have there been 'difficult operators'—is that a nice way of putting it?—in this sector? There sure have been. Did some people see it as a quick opportunity to make money and exploit students to the detriment of our community overall? Absolutely they did. So, therefore, these regulatory regimes are crucially important to good public governance in tertiary education—if we're going to be responsible in government and if we're going to choose to have the best outcomes. And that is what our public generally expect. They believe that if their children or grandchildren are going into these tertiary education centres that the focus is going to be on them—on the delivery and the outcomes that benefit the students and, therefore, the broader society. That's the expectation. But how can we guarantee it when we're handing it over to other people to deliver? It's a bit like housing. We don't get the opportunity as a government to go and build the homes. We supply to the states. Even now in Indigenous affairs we supply the money to the states who deliver the outcomes of the programs. Are we always happy with their delivery? Obviously not. Do we have a lot of control over that? No, not enough. But, remember the states are sovereign entities in themselves; therefore, state regulations also come across this part of the tertiary sector.
Where do we land now? We land in a place where there has to be decent cost recovery back to government from the regulatory controls, when, at the moment, we're only receiving 15 per cent of the moneys outlaid back into government outlays and the government picks up the rest of the regulatory program. That's unacceptable, and I think these institutions will come to see that this is a reasonable part to play for government. That is, one: to give us some ability as elected members to say, 'No, we have control over this area so your student will get the best outcome.' Two: we can direct when anybody is way out of order, and there are penalties for those people who are out of order—that's important. Three: it's not just wanting the best outcomes; it's getting really good people, but sometimes the only opportunity that they get is through tertiary education by getting themselves through secondary education, but then their outcome to lift themselves out of poverty is through education. There are hundreds of thousands of examples of that in this nation. Education is the gift.
I'm probably one of the very few members in this House who is not tertiary educated. My education came through business, and actually I think I learnt more after I left school than I did when I was there. I had a few other things that concentrated my mind at that age. I should have had a good talking to—it never happened. So, in that place, I still come with my expectation that the systems that we have in place in this nation are actually delivering the outcomes that we want as a parliament, we want as a government and we want the parents of these students to feel.
Why is it that prior to COVID parents from all over the world wanted to send their children for an education in Australia? It was a safe place for their children to be, and though there are those that claim racism, that wasn't the case. These students also provided vital labour for much of our entertainment industry, for nearly all of our restaurants and cafes and baristas and all of those people. They are the ones suffering the COVID crisis now. Especially in my tourist areas in my electorate you see businesses not open, and you wonder why they're not open. You ask the owner, and they say, 'There is no staff.'
We have other problems too that are COVID-related, including people moving out of the city into regional areas and taking rental properties. Therefore, the labour was once supplied by these students where they had somewhere to live when they were down there. Now they have nowhere to live. So, even if there is an availability of that backpacker market or that student market, there's no accommodation for them left in these tourist areas, so they're not going there. They'll stay and work in the cities or around their education facilities, whereas previously they'd move out.
I'd like to commend the government on the way they have gone about these changes. There have been three years of consultation. Legislation was first moved in 2018. They have worked through it slowly and, on top of that, these charges come in over three years, so there won't be an impost next week on all of these institutions. Hopefully, they will have time to get in a much stronger position in three years time than they are in today. Many students will have received the benefit that this nation provides through government support of education and they will go on to do great things, both nationally and internationally. In fact, we expect our students of today to be the national and international leaders of the future in whatever field they choose, so the investment by government in tertiary education in this country is crucial for our national wellbeing and our international wellbeing. They are going to be the innovators that start the start-up companies and the small businesses that are going to employ all of the other people around them. These are the people that are coming in to the innovation centre in Warragul and putting up their hand to say, 'I've got an idea.' Actually, they don't judge the people on their idea; they judge them on their talent in having an idea and putting it in place because they're the sorts of people that we want to grow this nation into the future.
I don't want to labour any further, but I don't see the opposition to this as real. I think it was a statement on education more broadly and I think the shadow minister's address was a general statement on the state of education. Most of it is out of our hands. They're accusing this government of an ideological attack on tertiary education. I have been a member of this government for all of its life and I've been around Labor governments and Liberal coalition governments before that. There has never been an ideological attack on universities that I have seen. There has been critical cost cutting at different times by different governments and new directions in where they might go. But one thing that we did find—and it doesn't matter in which area of public policy—was that just throwing more money at it without designed and properly managed outcomes is not the way to go. We have to get a benefit from the dollars that we put in. We need a nation that's growing and growing strongly. Part of that growth, part of that recovery, part of where we are heading in the future, has to be these very students that we're training today, including those that are still in this country to finish their courses and have stayed here to do their education. These are important issues for the nation and they should be taken seriously.
I don't support this legislation in essence because it will add significantly to the cost pressures already being faced by our tertiary institutions. Let's not forget that every extra dollar that universities have to contribute to the Tertiary Education Quality and Standards Agency will be $1 fewer that they will have to spend on research, on facilities, on teaching staff and on the other costs that they have. Ultimately, as costs go up for our universities, the fees go up, so I don't support this legislation and I'll be voting against it. Regrettably, this move by the government to increase the cost for universities is just another sign, another piece of evidence, that governments don't value our tertiary sector. They don't understand the practical and inherent value of knowledge, research and education, despite all of the evidence showing absolutely clearly that the better educated we are as a country and the better educated the community is then the smarter, richer, happier and healthier the members of the community are. So it's not a saving at all to be cutting funding to our tertiary sector or to be adding to the costs of their existing budgets. It's a false economy because we would actually be better off—and, in fact, the country would be richer and the government coffers would be fuller—if we had as many tertiary educated people as possible, who are, as I say, smarter, richer, happier and healthier.
I'm obviously a big fan of the tertiary sector and I'm very proud to say I align myself tightly with the National Tertiary Education Union. I believe they are a very powerful voice for the tertiary sector and we should be paying attention to what they have to say. To that end, I'm going to do something a little unorthodox for me; I'm going to spend a few minutes reading into the Hansard record the NTEU's response to the recent federal budget, written by Terri MacDonald, the director of policy and research at the NTEU, and published just five days ago in their online Sentry magazine:
With over 17,000 job losses and a $1.8 billion revenue fall, higher education was one of the worst hit sectors in the Australian economy by the pandemic. The sector had optimistically hoped that the Government would finally acknowledge the crisis and at least partly offer emergency assistance. But the 2021-22 Budget is a major disappointment.
NTEU's Budget submission called for public funding to be increased to 1% of GDP (in line with the OECD average) which would boost government funding of the sector and allow the abolishment of tuition fees for domestic student (alleviating the problem of compounding unpaid HELP debt) as well as improving research funding. We also put forward a proposal for regulatory reform which would mean that universities could work to individualised goals and objectives that include workforce planning and resourcing guarantees.
Federally, the reforms would also create independent body determined university funding, which would operate at arms-length from government thus depoliticising higher education funding. None of this is impossible; indeed, many other countries already have higher education that is fee-free for students and with far better government funding.
It goes on:
The Morrison Government's response to the COVID-19 crisis has not been to reimagine what a world leading tertiary sector could look like; indeed, they haven't even acknowledged the vital role that our public universities and TAFEs could play in revitalising our economy, leading innovation and in rebuilding our communities as we move beyond the pandemic.
The 2020-21 Budget—
that should be the 2021-22 budget—
is a major disappointment, but not only because the outlook is short term and new funding primarily targeted at for profit, private providers. Nor is it because it fails to assist Australia's 4th largest export industry during a time of unprecedented revenue and job losses. The greatest disappointment is that this is a Budget that has no vision for the sector, and instead sets our public universities and TAFEs up for even greater financial stress which could threaten the future of quality education and research.
Under the Budget, universities will see a decline of 8.3% in real terms between this financial year and next year, and a decrease of 9.3% in real terms from 2021-22 to 2024-25. Vocational education will also take a hit, with total funding to drop 10.8% next year and another 24.2% between 2021-22 and 2024-25. In fact, almost every line item under higher education investment in the Budget fails to keep pace with inflation—the exception being the increases in unpaid student HELP debts.
I'm almost finished. It goes on:
The Budget's forward estimates show how deep the cuts from last year's JobReady Graduates package changes are, with Commonwealth Grant Scheme (CGS) funding (used to support teaching of domestic student places) falling from $7.34 billion this year to $7.31 billion next year, before plummeting in 2022-23 and 2023-24 to $7.12 billion and $7.14 billion respectively. It starts to recover in 2024-25 with just under $7.3 billion in CGS funding—but this is almost 4% less than what it is for the current financial year. Worst of all, the reductions in higher education funding—especially in relation to the CGS funding—will coincide with the sudden increase in the university entry age population as a result of the Costello 'baby boom', with around 14% more Australian-born people expected by 2024-25.
In a sector with already reduced funding per student, this will see providers teaching even more students for less.
Instead of taking the opportunity to put in place a higher education system that will meet our future innovation, workforce and research (the $1 billion additional 'emergency COVID funding' for research last year has not been continued) needs, the Government has stuck with the same structural system that was in place in 2019 (and was showing cracks then) but with even less funding per student.
Even worse, the financial crash in the higher education sector will now be exacerbated by a future shortfall in domestic funding, at a time when student enrolments are likely to surge.
In reality, this Budget sets our public universities and TAFEs up for even more financial stress, and their reliance on other avenues of funding—primarily through international student fee income—will only be driven further.
This is assuming that the borders reopen and the students can get here. It goes on:
This is despite the Government building into the Budget the assumption that it will be at least another year or two before they even consider opening our international borders.
I'll leave out the last paragraph of that opinion piece by the NTEU. I laboured through reading that document because I think it's a very significant summary of the challenges being faced by the tertiary sector as a result of the 2021-22 budget, in the shadow of COVID, and, in particular, the reduction of student numbers—obviously, now, but also for the foreseeable future.
I come back to my opening point. We shouldn't be adding to the pressures the tertiary sector is under. In fact, what the government should be doing is looking at how it can increase gross funding for the tertiary sector, not adding to the cost of them doing business, so to speak. That would demonstrate a clear understanding by government that the tertiary sector matters and that education and knowledge have very significant practical and inherent value. We should be investing in it and we can afford to invest in it.
I'll make this point for probably the hundredth or even thousandth time in this place: we are one of the richest, most fortunate countries in the world. If there is one country that can afford to fund tertiary education properly then it's this country. The only reason we are not funding the tertiary sector properly is because of the priorities of this government—and of previous governments, I would add, because there have been cuts over the whole 10 years I've been a member of this place. We can afford to do so much better, and it's a false economy to be cutting funding or adding to the cost pressures and diminishing our tertiary sector. The country is all the poorer for it. If we want to set ourselves up for a bright future, we need to be investing in education—at all levels, from early childhood education to primary and high school and college, and at tertiary level, including vocational training. That's what we should be doing. That's what a clever government would do. But, regrettably, we are doing the opposite.
I will echo the comment made by a number of speakers a number of times over the years. Too many people in this place got a free university degree—I got a free university degree—yet we are so quick to take a different approach to our children and their children. What was good enough for us is good enough for them. As a country, we can actually afford to have fee-free first degrees for Australian citizens. We did it before. We can afford to do it again. That's the sort of future we should be talking about, not adding to the cost to universities by making them pay more for the quality and standards agency.
This is a misguided bill. I hope the opposition will vote against it; I certainly will.
These Tertiary Education Quality and Standards Agency bills are about maintaining the high quality of higher education that Australia is renowned for while ensuring the sustainability of the sector now and into the future. I will speak on this using two different lenses. One is my having come most recently out of being a research coordinator in a CRC based in Brisbane looking at the mining industry and efficiencies that could be found in energy and water consumption in that area. What astounded us constantly in this role of pulling together research bodies from around Australia, from around our universities, was how well we competed against international universities and how high was the standard of education here. Referring to the comments of the member for Clark, the practical value of our tertiary education was felt very firmly in that role. I speak, secondly, as someone who is very, very fortunate to have received a tertiary education in Australia and has been able take that education and apply it in situations around the world. What is still a very good truism, I think, certainly for engineers, is how sought-after around the world is an Australian engineering degree. That is very much because the Australian tertiary education industry produces at a very high standard, and that is recognised around the world.
Toowoomba, in my electorate of Groom, is a significant education hub not only for western Queensland and northern New South Wales but growing into south-eastern Queensland. While we have long been renowned as a hub for secondary education, the opportunity for us to continue to grow into the tertiary education space continues, particularly with the University of Southern Queensland, which is seeing great expansion in emerging fields such as aviation and aerospace. Just last week I had Minister Karen Andrews come and visit the campus at Kearneys Spring to hear about some of the exciting innovations there. With continued growth, USQ can achieve its ambitions of becoming a global leader in applied technologies through the convergence of end users with researchers really pulling out the practical value that the previous speaker, the member for Clark, talked about.
More broadly, this is a sector that the government believes in. The government has implemented a $53.6 million package of measures to support international education providers through fee regulatory relief and targeted support. This very much fits the government's 'technology and not taxes' approach to addressing the challenges that the future will bring us. We need on our team people who have got the critical thinking skills that higher education provides. We need them to do everything they can to ensure the education provided is of that high standard. That's exactly what we're talking about here, ensuring that we can maintain the high quality of tertiary education that Australia has such a great reputation for providing.
These bills give effect to the government's decision to implement increased cost-recovery for the Tertiary Education Quality and Standards Agency, announced in the 2018-19 budget. The government delayed the introduction of increased cost-recovery on several occasions because of external factors, including the COVID-19 pandemic. It's quite a simple approach and a very simple history for us to revisit, but it is very much now time for us to revisit those original cost-recovery plans. Australia is opening up. We are on the path to a much brighter future, and these bills need to be viewed within the context of the time. That's exactly the place we find ourselves with our universities—I speak from my recent trip out to USQ—and the optimism they hold for the future and the very stable foundations they have built. I note USQ's insistence on building its foundations on a very small percentage of international students, speaking when Minister Taylor came out to the university recently to look at what that has done for them and how well it has set them up. My understanding is that around eight per cent of their intake is international students. This gives it a very broad platform to continue and to overcome the challenges that perhaps could not have been foreseen, but the foresight of USQ really gave it an advantage coming into this.
I return to the point that our economy is opening up. There are brighter days ahead. In 2017 our university sector revenue was almost $38 billion. I think this addresses some of the concerns raised by the previous speaker. While COVID-19 has challenged the usual modes of operation for many institutions, I'm confident we will see them return to a level that meets or even beats the prepandemic benchmarks. At present, TEQSA's cost-recovery levels are very low, at around 15 per cent of total costs.