Tuesday, 2 December 2014
Higher Education and Research Reform Amendment Bill 2014; Second Reading
I want to pick up on a point made by one of the previous speakers in relation to indebtedness for young students who go ahead and pursue higher education. Of course there is a fundamental solution to that problem, and that is not to incur the debt in the first instance. This is true of almost everything in life. It has always amused me when reference is made to free health care and free education when, in effect, these are the two things that are by far and away the most expensive support and services that we give as a government to those of our nation. The case has been well made that people invest my money—a point that is lost on many—in acquiring their education. This is money which I have worked for and paid my part to the receipts of this nation, which has been lent to these students so that they can advance themselves in life. I have no problem with that. I understand the value of education, and I understand ensuring that we have arrangements in place that create educational opportunity for everybody. If the circumstances of a student require them to borrow some of my money and the money of other taxpayers to invest in their education, then that has my total support. But I am afraid I do not have much sympathy for the argument that an investment, which I loaned to somebody so that they can advance their circumstances in life, is a bad investment. I think that aspect of these changes is quite appropriate.
This package has an expanding and demand-driven Commonwealth funding system for students studying for higher education diplomas, advanced diplomas and associate degrees, costing some $370 million over three years. I hark back to my own era. I recall that when I graduated in a class of 36 students, only two went on to higher education. That opportunity was not there in my age. It was not an option for families who, in my case, could not afford the cost of higher education and the costs of living away from home that were associated with it in those days, before the expansion and regionalisation with universities. So for a government to continue to invest in the opportunities for these young men and women, I think it is a terrific thing. It is of great disappointment that we need to get caught up in this selfish attitude that somehow they have to pay off a debt that has given them one of the greatest gifts in life. The figures are out there. I do not necessarily have them in front of me, but the figures are out there that demonstrate that their earning capacity goes up threefold and fourfold. The investment may also prove to be one of the soundest investments that they make in their lifetime.
The reform package extends Commonwealth funding to all Australian higher education students in non-university higher education institutions studying bachelor courses—costing $449 million over three years. So there are combined investments heading toward a billion dollars in education and in expanding opportunities for education for the young people of our nation. Indeed, whilst not being an expert on the legislation, this extends to all applicants for higher education, be they young students graduating from school or those more mature students who endeavour to enjoy some of the benefits of tertiary development.
Over 80,000 students each year will be provided additional support by 2018. This includes an estimated 48,000 students in diploma, advanced diploma and associate degree courses and 35,000 additional students undertaking bachelor courses. Now that is a number worth repeating: 35,000 additional students. That is 35,000 young Australians who might not otherwise have had the opportunity without some of the reforms that have been presented in this higher education reform package. The legislation provides for more opportunities for students from low socioeconomic backgrounds through new Commonwealth scholarships—broadening out the scholarship program with the greatest scholarship scheme in Australia's history. This, in effect, means free education for the brightest students from the most disadvantaged backgrounds.
Often our colleagues from across the hallway here hold themselves out to have some sort of mortgage over those in our communities who come from lower socioeconomic circumstances. I know some of these young people; I know their families; I know their circumstances. I have employed people who came from lower socioeconomic circumstances. I intend to support any form of legislation through this place that increases the prospects for those young men and women. Indeed, it extends to mature students in this space also—people who can better themselves in life. That is why I believe this piece of legislation is a very well-thought-through piece of legislation.
I was disappointed to hear Senator Lazarus earlier say that there had not been sufficient consultation. That is somewhat in conflict with some of the social media comments that the senator made earlier today, criticising Mr Pyne, the minister responsible for this package in part, for endeavouring to make contact with him.
I want to attach my remarks to those of Senator Madigan, a statesman. I say on the record, his words today were very measured; they are very applicable to these particular circumstances. This is as important a piece of legislation as many that have come before this chamber in recent months. Everyone is in agreement that there has been a deterioration in how the Senate is conducting itself. There are, I understand, conventions that have been long held in this place that have been abused in recent times—with the gagging of debate. There cannot be, from my point of view, a more important piece of legislation; it is equal to the legislation we have had to deal with with the nation's security.
Again, it is worth emphasising the point that there will be an additional 35,000 students, many of them from lower socioeconomic backgrounds, whose opportunities will be dashed here today if this bill is not given the opportunity for proper debate. As Senator Madigan alluded to, we need to allow the time for the ideas to mature, and for everyone to listen to everyone else's contribution. My pay-scale is too low to understand whether Minister Pyne has a capacity to move and shift on some of these issues but I am sure that he continues to be open to discussions to resolve any of the difficulties that members of this Senate have.
Another part of the bill is freeing universities to set their own fees and compete for students. There is a novel idea! All of us operate in market arrangements away from this place—or have done, for those of us who have had some experience in business. The provision of education is a business; and probably the most important business, up there with the provision of health services and security for our nation. What a novel idea that we might allow universities to set fees and create the environment where they pursue a particular market share! I promise you they will respond to demand. You cannot survive in a free market environment unless you respond to the demands and keep yourself price attractive. So this sort of competition will give that a lift.
Competition will definitely enhance quality and make higher education providers more responsible to the needs of the students and the labour market. When universities and colleges compete, students are the winners. These additional 35,000 students and many tens of thousands of students from lower socioeconomic backgrounds will be the winners, because competition by its very nature drives institutions or businesses to the edge to make sure they provide the most attractive, the most competitive goods or services—in this case services—for the lowest possible price. That is how you achieve your market share. Then you have an absolute obligation to maintain the quality in the delivery of those services—if you are to retain your market share and grow your business.
I agree with the statement that when universities and colleges compete, students are the winners. By extension, our communities are the winners; our economy is a winner; all of Australia wins; we all win. That is why I am happy—despite the protests of some previous speakers—to have my money lent to students on these most equitable terms, so that they can grow.
I had a couple of hundred staff before I left my business to come here. I invested tens upon tens upon tens of thousands of dollars in my staff, for them to advance and develop their educational background, because I was rewarded in increased productivity. It is no different here. In my case, they paid me back through their productivity as employees. In this case, these students—most of whom I will never know—will pay me back as they contribute to the productivity of this nation, and we will all be rewarded as a result.
The argument about the loans is a moot argument and needs to be set aside. When you do that, you find that a little bit of the heat comes out of this debate and you can concentrate on the positive uplift that this particular reform package delivers right across our community, not discriminating at any level.
Strengthening the Higher Education Loan Program sees taxpayers support all students' tuition fees upfront and ensures that students only repay their loans once they are earning a decent income, of over $50,000 per annum. Let's just think about that. Not one cent needs to be paid upfront by the students, and they do not have to make a repayment until they are earning $50,000-plus. Some might think that $50,000 is not a lot of money. Certainly, some of my colleagues in this place could be forgiven for thinking that $50,000 is not a lot of money. But, if you are a young person starting out, I promise you that $50,000 is absolutely head and shoulders above what my good wife and I earned when I was 18, 19, 20, 21 or 22, when I was starting to collect some copper coins to get a bottle of milk. That's how long ago it was. The milk was still in a bottle.
Senator Payne interjecting—
Correct. And I promise you there was no-one at my gate wanting to lend me money, not one red razoo, so that I could get ahead. I would have loved a bit of this stuff around the place going back 30-odd years ago.
The package also removes the FEE-HELP and VET FEE-HELP loan fees which are currently imposed on some students undertaking higher education and vocational education and training. I have listened to the contributions of a number of speakers and there was not one mention of that. You want to talk about money and you want to talk about those things that you think are an impost but not one single speaker raised it, and that is so typical of the contributions often made in this place against progressive government legislation. It is almost as if every night—certainly starting last September—people go to bed, they fit up this machine, it erases the past, it erases the 26 deficits in a row and it erases all the promises of surpluses that would have allowed governments more flexibility in the space of education, in the space of health, in the space of—