Matt O'Sullivan (WA, Liberal Party) Share this | Hansard source

I rise to speak to the bill that's before us right now, the Education Legislation Amendment (Startup Year and Other Measures) Bill 2023. You'll be pleased to hear that I seek to be relevant precisely to the bill that's before us, Mr Acting Deputy President.

It is fantastic to see that the government agrees with the coalition that growing our economy and encouraging the development of new businesses are central to Australia's future. The coalition has a fantastic track record of encouraging and nurturing homegrown startups and local entrepreneurs. However, I was disappointed to see that the coalition's established Entrepreneurs Program was savagely cut by the Albanese Labor government in the last budget, which we saw delivered by Dr Chalmers. Thankfully, the government chose to adopt, and will deliver, the coalition's $2.2 billion university commercialisations package, which is good. But this amendment, to introduce a new category of student loans, aims to support students participating in higher-education accelerator programs. This might sound excellent, in theory: boosting accelerator programs that will help grow the Australian economy and provide additional opportunities for young Australians to set up their own businesses and startups. But unfortunately, coming from Labor, this sounds too good to be true—and often it is.

Sure enough, closer inspection reveals that it is yet another half-baked policy idea from the Labor government, that once again hasn't done its homework. So far, Labor haven't got a very good track record with answering questions. We've seen that with this bill. I am the deputy chair of the Senate Education and Employment Committee, and we held an inquiry into this legislation. Senator Henderson was with us throughout that inquiry, and through it we discovered that this government is yet again refusing to answer questions or provide details to the particular elements of their programs. It's very, very disappointing. It's a recurring theme that we're seeing—but I digress.

It's notable for supporting our young Australians who want to create their own work opportunities and career pathways in life, but, when we look at the specifics of this bill, a lot of detail is lacking. The value proposition behind this funding is opaque, and that's at best. We are setting up these young, budding entrepreneurs and business owners to take on an additional debt of up to $23,600 without obtaining any kind of academic credentials or something with any tangible value. With an ordinary HELP or VET student loan, students are actively working towards a tangible qualification, which is a good thing. Stakeholders and universities have raised some serious concerns about this legislation, and it's obvious that their input has fallen on deaf ears—as usual. What we have right now is an arrogant government with a revived militant, single-minded union movement whispering in their ears, urging them to discard what is best for our country in favour of what is best for the fat cats and the top dogs in the union movement.

Ignoring key stakeholders, important stakeholders, who are involved across our education system—in particular, stakeholders like Universities Australia and the Regional Universities Network—in favour of placating their union mates at every turn is what they are doing. These stakeholders provided important recommendations and suggestions that, sadly, have been ignored. These stakeholders want clarity and detail around the purpose and value proposition of this proposed fund. They want clarity and detail on its objectives, on which course models will be accredited and on eligibility criteria for accelerator programs. They want to know. They've got questions like: How will students be selected to participate? How is the allocation of the 2,000 places to be determined? What can the funding be spent on? What about students in the regions? What about international students, who do not make up a significant part of the student cohort at many universities? This lack of clarity is alarming, yet, as I've said, it is unsurprising from this government.

The stakes are high, and the government seems blind to the fact that 97 per cent of startups exit the market or fail to grow. Are we just setting up these students to fail? Is that what we're doing? We have plenty of questions that have gone unanswered. Stakeholders have plenty of questions that have gone unanswered. This government will argue that it held consultations with stakeholders and that the department conducted a student survey on the proposed design. According to the consultation paper that was provided when they were engaging with the sector the intention of the program is to:

… enable students to participate in university accelerator programs, with the view of commercialising good ideas and injecting new business dynamism into our economy.

While this might seem like a noble and, dare I say, lofty intention, the practicalities bring this issue thudding back down to the cold, hard earth.

Universities Australia is the peak body representing Australia's 39 comprehensive universities. They've called out the Albanese Labor government for its shoddy work. Let me read what was in their submission:

Through consultations with members, it is evident that more clarity around the purpose and outcomes of the program is needed. It is unclear to our members if this is a practical educational program aiming to build a pool of skilled entrepreneurs with experience in the startup ecosystem, or if the aim is to create new firms.

If this already isn't sounding too good, it gets worse. They said:

Student startups are not typically funded through loans, as it is unknown when the loan will be repaid. Angel investors are the normal source of capital.

There's no mention anywhere in this bill of angel investors—nothing in this legislation. There's no mention of those experienced individuals who are able to guide and mentor these students on their startup journey. Not only does this cut the students off from the valuable source of information and hands-on experience but these inexperienced students will also end up carrying the risk and the cost of this program along with the universities.

The Group of Eight represents Australia's leading research-intensive universities. During the consultation, they reiterated a very important point. I'd like to read it to you. They said:

… typically these programs admit only the best ideas or "pitches" from students and alumni through a competitive process.

That is an important part, yet it's lacking in this model. They said:

The focus is to advance the best ideas with a realistic possibility of success—noting the high level of failure inherent in startups.

…   …   …

… the primary objective of Startup Year must be clearly articulated in the interest of maintaining the simplicity and effectiveness of the program. Specifically, whether Startup Year is intended to directly support the development of startups through accelerator programs or to more generally support education and training in skills related to startups.

What we're seeing is a lack of rigour around who will be provided with funding and what sorts of pitches will be provided with support. The normal process of needing to pitch to an investor, someone who's got a bit of skin in the game, ensures that the student—the young, budding entrepreneur—is provided with the very best opportunity. Because of that rigour before you've even got the funding, you're able to have your idea teased out and the best possible projects are supported. But it's not so with this program.

The Australian Technology Network of Universities is the body that represents six of Australia's most innovative and enterprising universities, including Curtin University in my home state of Western Australia. These universities have already developed their own startup and accelerator programs. They support thousands of student entrepreneurs by hosting hundreds of startup micro businesses on their campuses. The HELP program exists to help reduce the financial risk to students but, again, with this new loan category, as they've said, there's a high risk of students exiting startups with fewer tangible benefits than students undertaking an established qualification. What we could end up with is students being saddled with debt without an outcome. It's one thing to take up a debt through a student loan—through HECS or FEE-HELP—and you have a qualification at the end of it. But it's another thing entirely to take on debt without something tangible to show for it; that just saddles people up with that debt.

Students don't have deep pockets and they can't afford to be plunged into debt with very little gain, especially during what we're seeing right now: the Albanese Labor government's cost-of-living crisis. The pressure is on and the clock is ticking. The startup year is scheduled to begin on 1 July; that's only a few weeks away. These universities have been on notice for almost a year, and yet because this government is not ready our universities have been left to flounder. Not one startup-year course has been proposed yet and yet it's commencing in just a few weeks. How could there be, with such shambolic and nonsensical legislation put before us?

Instead of rushing this bill through, like all others, I would urge the Labor government to step on the brakes, to listen to the feedback, to share the results of the consultation and to get in behind the amendment that Senator Henderson has moved here. They should get in behind that amendment, which does exactly that—it just pumps the brakes for a bit. Let's get some detail and some rigour around this. But I have to say that I'm sick of standing up here and having to call this sort of stuff out when it seems to be that way for so much of the legislation brought before this place. I urge the Labor government to stop bringing forward half-baked policies cooked up in a dream. Bring forward solutions with detail that we can actually consider. Sadly, we don't have it with this.

While this bill may be well-intentioned, the detail, as per usual, is lacking. In its current form, the coalition cannot support such a risky bill. It will put more pressure on our students, especially during this ongoing and serious cost-of-living crisis. I urge the government, as I said, to consider this second reading amendment—and I know that there will be other amendments through the committee stage—which seeks to improve this bill by delaying it to make sure there's some proper rigour put around it. It's really important that we get this right, because we don't want to saddle students up with unnecessary debt, with debt that's going to weigh them down as they're embarking on their future careers. That's what this bill runs the serious risk of doing.

I urge the government to look out for all students during this devastating cost-of-living crisis, and I join with Senator Henderson in her remarks. I encourage students that there are many good programs out there which you really should look at, get behind and seek out the support of the government, entrepreneurs and philanthropy—seek out those levels of support. But this one is particularly risky and you should consider it carefully, if this bill is passed.

I urge the government to look out for students and to include our proposed safeguards for students, to protect them and to protect their futures. We must ensure that this startup year doesn't turn into a year of disaster for the bright, young entrepreneurs of the future.