Senate debates

Tuesday, 3 August 2021


Tertiary Education Quality and Standards Agency (Charges) Bill 2021, Tertiary Education Quality and Standards Agency Amendment (Cost Recovery) Bill 2021; Second Reading

12:51 pm

Photo of Ben SmallBen Small (WA, Liberal Party) Share this | Hansard source

Thank you, Mr Acting Deputy President. I will gladly reflect on the policy bellyflop that the Leader of the Opposition has executed in rolling the shadow Treasurer in the other place, with the Labor Party now adopting a fifth position when it comes to this government's income tax cuts. Why do I focus on the relevance of these income tax cuts? The relevance is that this government believes that services delivered in the Australian community should, where appropriate, be funded closest to the source of the cost being incurred. We're not going to take tax money off the tradies out there in suburban Australia, who are building houses as quickly as they can on the back of this government's HomeBuilder stimulus, and funnel it instead into the university sector.

Despite the hysteria from those opposite and on the crossbench the claims of incredible austerity and desperate times in the university sector are not supported by the statistics we see in the media. Here are some cold, hard facts. In 2020, arguably one of the most economically dire periods for this nation and indeed the world, Monash University reported an operating surplus of $259 million. And they're not a stand-out performer. The University of Melbourne reported an operating surplus of $178 million. Indeed, it spreads further. The University of Queensland reported an operating surplus of $83 million. In my home state of Western Australia, the University of Western Australia reported an operating surplus of $58 million. South Australia was right up there: the University of Adelaide reported an operating surplus of $41 million and Flinders University reported an operating surplus of $35 million. And so it goes.

This government is unashamedly on the side of hardworking Australians rather than having those taxpayer funded institutions pocketing millions of dollars when it comes to cost recovery and taxation arrangements. You might think that that's somehow blindingly obvious, but apparently to those opposite this is an unprecedented crisis for the sector. We've heard complaints today that they were denied access to JobKeeper. That's not a new narrative but it is simply not supported by the data. Because even if we were to consider universities entitled to the charitable threshold of a 15 per cent revenue reduction, when you report an operating surplus of $259 million, it stands to reason that you should not be—and were not—given a penny.

What do these bills before the chamber actually do? Well, the Tertiary Education Quality and Standards Agency bills give effect to the government's decision to increase the cost recovery for TEQSA, which was announced in the 2018-19 budget. As my colleague Senator O'Sullivan rightly pointed out, we delayed the onset of these increased cost-recovery arrangements on several occasions due to external factors, not least of all, COVID-19.

The cold, hard reality is that the university sector can afford the gradually phased increase in cost recovery that these bills represent. Let's not forget, we're starting from the incredibly low threshold of 15 per cent of TEQSA's costs being recovered from the sector, with the taxpayer, therefore, bearing the burden of funding the other 85 per cent of TEQSA's activities. Those pennies have to be earned here. They don't rain down from the imaginary money tree that those opposite love to shake. We've seen it again with their proposal that they're going to give $300 to every Australian who chooses to do the right thing, to act in the national interest, to protect the vulnerable in the community and get vaccinated. We won't stand for it on this side of the House. That's why these bills will increase the cost recovery of TEQSA gradually to 90 per cent of the regulatory costs, and some 75 per cent of funding that body overall.

It is incumbent upon a responsible government like the Morrison government to find ways to reduce costs to the taxpayer. It's that prudent approach that allows us to proceed with things like stage 3 income tax cuts, which will mean more of the money that hardworking Australians earn stays in their pockets. What does cost recovery for TEQSA mean? It means increasing the application based fees to recover the true cost of those activities from the sector. That increase to the application based fee will be enabled by determination issued by TEQSA. Far from cries that that somehow is negligence on the part of the government, I would contend that it is, in fact, the most prudent approach, where TEQSA works closely with the sector to develop a cost-recovery model that achieves the outcomes that we seek to yield for the taxpayer without undue distortion to the sector.

Increasing that new annual charge on higher-education providers in terms of risk monitoring and regulatory oversight is a new annual charge. However, as I say, that's also based on the draft cost-recovery implementation statement, which is consistent with the Australian government's cost-recovery guidelines. That's not negligence; that is prudence. And it is exactly the behaviour that Australians have come to expect of a responsible government.

No constituent sector, body or organisation has ever welcomed the introduction of a government charge. So it stands to reason that the higher education providers have criticised this new charge, which is being phased in, as we've heard. But what we're not hearing is that it's estimated the vast majority of providers will pay an annual charge of between $25,000 and $35,000 a year once fully phased in, in 2024. When universities are running on an operating budget each year of billions of dollars, the impost of a $25,000 to $35,000 fee to reduce the burden on the taxpayer—those hardworking Australians who have to fork out to provide the services that we all enjoy—is not the end of the sector. It is not a drastic cut. It is not austerity. It is, in fact, responsible government.

The charges bill, which, as I just mentioned, will levy registered higher education providers to recover the costs of the risk monitoring, compliance monitoring and investigations aspects of TEQSA's work, is not unique. Many other statutory authorities and government agencies levy the sectors that they operate in to reduce the cost of that compliance and oversight activity on people who derive no benefit whatsoever from the sector. Arguably, just as a senator mentioned earlier, investment in higher education is a public good. But there are many Australians who do not benefit from a tertiary education and who should therefore not be expected to fork out every year their hard-earned pennies to pay for this organisation. The amendments, which do require this annual fee to be paid as and when it falls due, also attract penalties for late payment. Failure by a higher education provider to pay the charge will constitute a breach of its conditions of registration. That puts these organisations—put on a pedestal by some, but held to account by this government—on a level playing field with everyone else that interacts with the Australian government. And make no mistake about it, this is a government that is committed to supporting higher education.

We have provided substantial financial support to higher education providers during the COVID-19 pandemic. Notwithstanding the JobKeeper debate, these are organisations that did benefit from government stimulus spending, that have faced some challenges with our closed international border and that were rightly supported by this government through that period. However, on the back of that recovery—and we know that Australia's economic recovery has been stronger than anywhere else in the developed world economies and that we are a nation that has seen more people in work, as recently as in July, than at the onset of the pandemic—the claims of tens of thousands of job losses and breadlines because of austerity in the higher education sector simply are not borne out by the statistics that we see in this place. So this government, as a responsible government, will reduce the accreditation fees for small higher education providers, with a sliding scale of reductions that allows providers with a student load of less than 500 full-time equivalent to receive a maximum reduction of some 70 per cent. I think that's in keeping with the fact that this is a government that consistently supports the little people. But, where there is capacity to pay, as $259 million surpluses clearly demonstrate, we will burden—we will reduce the burden on smaller Australia, those aspirational Australians who have to fork out for all of this, and instead charge those that can afford to pay.

Along with all this other additional expenditure, along with reducing the burden on Australians, this is a government that will make additional investment in research and short courses because we consider that these measures have already provided and continue to provide significant coherent, targeted and time limited support to the Australian economy as we deal with the pandemic. That's why I support these bills as the actions that a responsible government takes, and I commend them to the Senate.


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