Carol Brown (Tasmania, Australian Labor Party, Shadow Parliamentary Secretary for Families and Payments) Share this | Link to this | Hansard source

My question is to the Minister representing and Minister for Education, Senator Payne. I refer to the government's extreme higher education changes. Is the minister aware of the comments by the architect of the HECS system, Professor Bruce Chapman—

Opposition Senators:

Opposition senators interjecting—

John Hogg (President) Share this | Link to this | Hansard source

Order! Interjecting across the chamber does not help. Continue, Senator Brown.

Carol Brown (Tasmania, Australian Labor Party, Shadow Parliamentary Secretary for Families and Payments) Share this | Link to this | Hansard source

Is the minister aware of the comments by the architect of the HECS system, Professor Bruce Chapman, that an unintended consequence of greater unpaid debt will be 40 per cent of female graduates unable to pay their debt in full? Why is the government unfairly shifting the cost burden of a degree onto those who will never earn enough to repay that debt?

Marise Payne (NSW, Liberal Party, Minister for Human Services) Share this | Link to this | Hansard source

I thank Senator Brown for her question. It is lovely to hear from Senator Brown. We are making some very important changes in these education reforms, as the chamber would be aware. I have spoken about them before in terms of making Australia internationally competitive—in fact, a world leader in higher education—making sure that we open up the sector to competition and to quality providers, making sure that students who are perhaps challenged in entering bachelor degrees have a pathway into tertiary education, maybe through a sub-bachelor degree or a diploma or something like that. All of those positions, for the first time ever, will be funded by the Commonwealth government, as I have said before.

In relation to HECS and the loans scheme, a number of targeted decisions have been taken by the government to secure the scheme into the future, both through the budget process and the identification by the Commission of Audit of the need to reduce the cost to the Commonwealth of HELP through changes to the interest rate and the repayment thresholds applying to HELP loans. This will be particularly important given this budget's historic extension of funding to all higher education students for the first time ever. I referred to that earlier.

There are two important changes which will make a HELP more financially sustainable. There will be a fair interest rate on HECS. The interest rate applied to a HELP loans will be, as we know, the 10-year bond rate. This rate reflects the costs to government of borrowing to fund the loan and is less than for a loan that anyone is able to obtain from a banking institution, of course. The new interest rate will apply to all HELP debts from 1 June 2016. A fair repayment— (Time expired)

Carol Brown (Tasmania, Australian Labor Party, Shadow Parliamentary Secretary for Families and Payments) Share this | Link to this | Hansard source

Mr President, I ask a supplementary question. I refer again to Professor Chapman's comments that outstanding student debt under a deregulated fee system would substantially exceed the budget estimate. Why has the government understated the amount of student debt arising from its extreme higher education changes?

Marise Payne (NSW, Liberal Party, Minister for Human Services) Share this | Link to this | Hansard source

What Senator Brown does not acknowledge in both of her questions is that we believe that, in opening up the system in the way in which these reforms are cast, the higher education institutions, not governments, will be the best judges of how to run their own business and also of how we are able to maintain and promote a world-class higher education system.

Kim Carr (Victoria, Australian Labor Party, Shadow Minister Assisting the Leader for Science) Share this | Link to this | Hansard source

Mr President, I raise a point of order under relevance. Both these questions to the minister go to the issue of HECS debt. The first went to the question of female graduates and HECS debt and the second to the government's underestimation of the HECS debt. The minister has refused to deal with those matters.

John Hogg (President) Share this | Link to this | Hansard source

There is no point of order at this stage. I am listening to the minister's answer. The minister has 35 seconds remaining to answer the question.

Marise Payne (NSW, Liberal Party, Minister for Human Services) Share this | Link to this | Hansard source

I did want to move on to the question of the repayment threshold. We have made it very clear that graduates will begin to repay—

Kim Carr (Victoria, Australian Labor Party, Shadow Minister Assisting the Leader for Science) Share this | Link to this | Hansard source

HECS debt—that's what the question's about.

John Hogg (President) Share this | Link to this | Hansard source

Order!

Kim Carr (Victoria, Australian Labor Party, Shadow Minister Assisting the Leader for Science) Share this | Link to this | Hansard source

Why don't you try to answer it?

John Hogg (President) Share this | Link to this | Hansard source

Order! Debating it across the chamber does not help at this stage. The minister has the right to be heard in silence. Senator Payne, continue.

Marise Payne (NSW, Liberal Party, Minister for Human Services) Share this | Link to this | Hansard source

What I was going to say—if I could just finish the next two words in the sentence—is that graduates will begin to repay their HECS debt when they start earning over approximately $50,000 in 2016-17, from 1 July 2016. (Time expired)

Carol Brown (Tasmania, Australian Labor Party, Shadow Parliamentary Secretary for Families and Payments) Share this | Link to this | Hansard source

Mr President, I ask a further supplementary question. Can the minister confirm that university degrees would cost up to three times as much under a deregulated fee system and leave graduates with debts of more than $120,000? Why is the government mortgaging the future of young Australians?

Senator Cormann interjecting—

John Hogg (President) Share this | Link to this | Hansard source

When there is silence we will proceed. The time to debate this is after question time, Senator Cormann.

Senator Carol Brown interjecting—

Senator Brown, I am waiting to give the call to the minister so your question can be answered.

Marise Payne (NSW, Liberal Party, Minister for Human Services) Share this | Link to this | Hansard source

I thank Senator Brown for the supplementary. The problem with the approach that is being taken by those on the other side to this question is that they can only deal in hyperbole and exaggeration. They have no facts with which to deal. We have Australian universities dropping in world rankings, we have limited choice, and we have every student not being funded by the Commonwealth. What we want to do, Mr President—

Senator Kim Carr interjecting—

John Hogg (President) Share this | Link to this | Hansard source

Order! Minister Payne, resume your seat. Senator Moore.

Claire Moore (Queensland, Australian Labor Party, Shadow Minister for Women) Share this | Link to this | Hansard source

I raise a point of order as to relevance. The specific question referred to the increase in university fees and asked the minister to confirm whether university degrees would cost up to three times as much. That was the specific question, Mr President, and I ask you to draw the attention of the minister to that question.

John Hogg (President) Share this | Link to this | Hansard source

I do draw the minister's attention to the question. The minister has 33 seconds remaining.

Marise Payne (NSW, Liberal Party, Minister for Human Services) Share this | Link to this | Hansard source

Let me make it very clear for Senator Moore and Senator Brown: I do not actually agree with the premise of Senator Brown's question and I responded by saying it was based entirely in exaggeration and hyperbole. So I do not agree with the question; therefore, that is my answer to that part of the question.

I advise the chamber that we are giving higher education institutions and students in Australia the capacity to be internationally competitive and to engage in thousands and thousands more courses which should see 80,000 more students in our institutions by 2018. (Time expired)