Monday, 19 June 2023
Education Legislation Amendment (Startup Year and Other Measures) Bill 2023; Second Reading
Several months ago, I visited the UTS Startups hub, an exceptional example of a university accelerator course working as it should without imposing a massive debt trap on students. The UTS Startups hub is one of some 120 accelerator or incubator courses being offered by Australian universities, most at no or very little cost to students. At the UTS Startups hub last year, more than 800 students enrolled at no cost—student entrepreneurs seeking to create a business, develop a new idea or progress in innovation. Some 570 jobs were created. Like so many universities, UTS sees great value in investing in student entrepreneurs and provides around $3.5 million a year for its wide range of startup activities, and this is well and truly paying off. In some five years, the UTS Startups hub has created companies worth, in total, more than $500 million.
I regret to say that the Education Legislation Amendment (Startup Year and Other Measures) Bill 2023 is half-baked policy. It is a solution in search of a problem. Why on earth would students take on a massive startup year loan for an accelerator or incubator course when there are more than 100 from which to choose being offered currently by many universities, principally free of charge? I say to Australian students: if this legislation passes today, don't risk taking out a startup year loan. Have a look at the incubator and accelerator courses that are on offer and even some of the TAFE courses, such as the Certificate IV in Entrepreneurship and New Business qualification offered by New South Wales TAFE, which is roughly half the cost of a startup HELP loan.
As I said, this is half-baked policy, a Labor election commitment—in truth, a thought bubble—from the industry minister, Mr Husic. It is embarrassingly clear that the government has not done its homework, and we should not be surprised. Labor is tone-deaf to its cost-of-living crisis, which is imposing such a significant burden on so many students. So many students are struggling to put food on the table or pay the rent. Labor is tone-deaf to the more than three million Australians who have a HECS debt which has just increased by a massive 7.1 per cent as a result of Labor's sky-high HECS indexation. This is compounded by a broken HECS payment system, which indexes loans without taking into account repayments made during the financial year. This loans scheme should be stopped before it starts. Startup Year would cripple students with a debt of up to $23,600 for full-fee-paying university courses.
What's so ridiculous about this whole scheme is that these courses don't even exist currently. The guidelines that underpin the operation of the Startup Year program were only released publicly last week—we have been calling for these guidelines for months, as have the universities—and this is a program that's meant to start in less than two weeks. It's an absolute mess. That's why I will be moving, at the end of my contribution, a second reading amendment that the bill not proceed until the guidelines are tabled. I also say it's very regrettable that the universities were not consulted on the draft guidelines. They were not given that opportunity. This is extremely arrogant of the Albanese government. The government is asking universities to deliver these courses, and it does not pay the universities the courtesy of consulting them on how these courses will be delivered.
Last year, the government ran a consultation on the proposed Startup Year program, and the university sector was absolutely scathing in its criticism. There were a broad range of concerns, deep concerns—that this is a scheme unfit for purpose; this is a scheme which offers no discernible value to students; the whole design of Startup Year is flawed; the risk to students is too high; students would be reluctant to take on more debt more consultation was needed, such as a working group, before the bill was passed; and there should be a proper pilot, a genuine pilot, before the scheme is rolled out in full. There was also broad concern that the Startup Year loans program discriminates against regional students and regional universities without existing accelerator programs.
In fact, these submissions were so scathing that the government tried to keep them secret until the Senate ordered, initiated by the opposition, that the submissions be made public, though I do note our disappointment that the Greens backed the government's public interest immunity claim to keep three of those consultations secret. That was most regrettable, particularly for a government which, before the election, crowed so intensively about the importance of being transparent, and we now see this government failing this basic obligation time and time again.
This bill demonstrates that the Albanese government has not put the interests of students first. We are supporting the provisions in relation to Avondale University as a table B provider, the provisions in relation to the Australian Research Council and the amendment in relation to providing New Zealand citizens who apply for PR, up until 1 July, the opportunity to access HECS. But we will be seeking to vote down the Startup Year provisions because these pose such a significant risk to students. As I say, it's very regrettable that the interests of students have not been put first and foremost by this government.
If we are not successful in voting down the Startup Year provisions, the opposition will be seeking to pass a number of substantive amendments. They are that the bill should include intellectual property rights protection for students, which it currently does not do; and that, as far as reasonably practicable, at least 25 per cent of students who receive startup assistance should be enrolled in a regional university. We've seen no regard for the needs of regional students in this bill. We also are seeking for the Secretary of the Department of Education to be given the power to refund those students who enrol in a Startup Year course where the higher education provider fails to deliver a course which meets its objectives. We want these very, very important safeguards for students.
We're also seeking that the government run a proper pilot of the Startup Year program at least at one university or perhaps at two universities, that this pilot be subject to an independent review and that the results of the review be tabled in each house of the parliament. We are very concerned that the government's current proposal—after the university sector called for a pilot to be run before this is rolled out, with the full 2,000 places—is to roll out 1,000 places, which we don't believe gives students enough protection and isn't a genuine pilot based on proper criteria to really test the efficacy of this scheme. So, as I say, this is bad policy. Some universities have spoken out and continue to speak out very strongly against this loan scheme.
I want to place on record my disappointment—and this was made very clear in the Senate inquiry into the bill, which was conducted a couple of months ago—that some of the peak higher education bodies such as Universities Australia, the Group of Eight and the Australian Technology Network have not been more robust in speaking out about the risks to students in taking on this full-fee-paying student loan. Just imagine the lunacy of saying to a student, 'Go and take on $23,600, or one course at $11,800, for a full-fee-paying course at such a high risk.' It would be subject to indexation next year and every year beyond that, on top of the current debt that so many students are carrying, rather than looking at one of the 120 courses which are currently on offer, many of which are available to students at little or no cost. It is an absolute nonsense.
In speaking about the importance of backing our young student entrepreneurs, I want to celebrate the incredible work of the coalition when we were in government in backing entrepreneurs, including young Australian entrepreneurs. We introduced programs such as the Entrepreneurs Infrastructure Program, worth nearly $500 million, to support the commercialisation of goods and job creation and lift the capability of small businesses. We condemn the government's decision to cut some $200 million from this program in the October 2022 budget. This was delivering for all businesses wanting to be entrepreneurs; this was delivering right across this nation. It was a very regrettable decision by the Albanese government.
I also celebrate the $2.2 billion University Research Commercialisation Action Plan, which was a very significant initiative of the former coalition government. I am pleased that this is being supported by the Albanese government and has support across the parliament. This includes some incredibly important initiatives including the $243 million Trailblazer Universities Program, which brings together industry, government and the six universities that have won these grants to develop wonderful new trailblazer programs for the future. The commercialisation package also includes a $1.6 billion investment for Australia's Economic Accelerator, which is a new stage-gated competitive funding program to help university projects, in partnership with industry and government, to bridge the so-called valley of death on the road to commercialisation.
There is the opportunity right now to go back to the drawing board and, at the very least, run a proper pilot so that this very flawed and defective scheme can be independently assessed using proper criteria by an independent process, with the results reported back to the parliament. At a time when so many students are on their knees, battling Labor's cost-of-living crisis and with escalating student debt with no relief in sight, the best the government can do is put forward this half-baked loan scheme, which will plunge students into even further debt for no discernible benefit.
I move an amendment to the motion for the second reading:
Omit all words after "That", substitute:
(a) by reason that:
(i) much of the design, implementation and operation of the Startup Year program, including important safeguards for students such as the protection of students' intellectual property rights, are to be governed by the START-HELP Guidelines, a draft of which has not been tabled in the Senate; and
(ii) the bill does not otherwise include the necessary provisions relating to the design, implementation and operation of the Startup Year program, including important safeguards for students such as the protection of students' intellectual property rights;
(b) further consideration of the bill be made an order of the day for the sitting day after draft STARTUP-HELP Guidelines have been tabled in the Senate.
I rise to speak to the Education Legislation Amendment (Startup Year and Other Measures) Bill 2023. The bill amends the Higher Education Support Act 2003 to create a fifth category of student loans, called SY-HELP, under our existing Higher Education Loan Program.
This scheme will allow up to 2,000 students, current postgraduate students and recent graduates to participate in university accelerator programs to develop their own innovative startup ideas. The bill enables students undertaking the accelerator program courses to, potentially, qualify also for certain social security payments. It also updates the Australian Research Council Act 2001 to increase annual research funding caps, to reflect indexation rates for the financial years between 2022 and 2025 and adds a research funding cap for the financial year of 2025-26. The Greens support, fully, these measures for ARC funding.
We support the intention behind this bill to encourage more students to build skills in entrepreneurship and develop their own ideas. There is definitely a need to support students to do this, to be more creative, to be entrepreneurs, for their ideas to come to life. We definitely need more entrepreneurs from already disadvantaged groups, such as First Nations people, people of colour, women and others who come from marginalised backgrounds.
We support this program but very reluctantly. I say 'reluctantly' because this program will shackle students with more debt. Students can access two loans of up to $11,800 over their lifetime to participate in these courses. It is a really sad and rather shameful reality that in a country like Australia the only way that students can access programs like this or any type of higher education is through being shackled by a burden of debt, a burden of debt that is increasing every year to obscene levels. What it tells you is that we are putting students, again and again, into a broken system. We should not be adding to that but we should be changing the entire system. That is what it's about, because there is no other way for students to access education.
Education is a public good. I don't know how many times I have said that in this chamber and out there, and I will keep saying it. The Greens will keep saying it. University and TAFE should be free and student debt should be wiped, and I will be moving a second reading amendment to that effect. We will also be moving amendments, in the committee stage, to tackle the current student debt crisis, to abolish indexation and to raise the minimum repayment income to the median wage for all study loans, including this one which is the startup.
I want to take a moment to call out the coalition's hypocrisy on student loans. The coalition is a party who, when they were in government, for the last 10 years or whatever it was, continuously attacked universities, staff and students. There's a very long list of these attacks that they have made. They tried so hard—I think it was under Prime Minister Tony Abbott at that time—to deregulate fees, which would have added an immense amount of debt to students.
There were funding cuts in their time. They vetoed ARC grant applications that didn't fit in with their far-right ideology. To top it all off, under the cover of COVID, in 2020 they created the disastrous job-ready graduates program, and it is the coalition who doubled the fees for degrees, like arts and commerce, to more than $14,000 a year. All that scheme did was to condemn generations of students to decades more of debt and push universities into strife, because it was a funding cut. So it's rich of them to stand up here and say how concerned they are about student debt. You were in government for 10 years. You could've done something about student debt. But you didn't. In fact, you did the opposite. What that particular program did was: it further entrenched gender inequality, as women, overwhelmingly, study the courses which were hit hardest by the fee hikes, incurring more and more student debt.
Also the coalition, in April, just a couple of months ago, teamed up with the government to reject my bill, which was to abolish indexation and all student loans and to raise the minimum repayment income to the median wage. Labor sat with the coalition to vote against measures that would have provided relief to students, even though they knew that there was a pretty easy opportunity to do something, to take a step forward, to deal with the student crisis. You could say, as to the coalition, 'Better late than never,' but I'm sorry—I am sceptical about their motivations and why they're doing this. Those in the coalition have an opportunity to prove that they are really serious about doing something about the student debt today. If the coalition really cares about the student debt and how students are suffering and the hardship that they are facing because of their debt plus the cost of living crisis, then they can very enthusiastically support the Greens' amendments to this bill to abolish indexation and raise the minimum repayment income to median wage so that people only start paying off their loan when they earn a decent income—otherwise, it is just opportunism on their part, and no-one will be fooled by it.
Let me now come to the party of the government, the Labor Party, and the lack of any action from this government to address the unjust, unfair and ever-increasing burden of student debt. For months and months, almost every day, we have heard stories about how student debt is harming people. It is beyond clear that it is a deep crisis. People are anxious about their debts, for good reason. Student debt is locking young people out of the housing market, stopping them from getting married or starting a family. Student debt is crushing their dreams of further study and taking longer and longer to pay off. I have heard heart-wrenching stories—and a lot of them were coming from women, who said that they would never have gone to uni if they'd known that they would end up with such a huge amount of debt. That debt will, under Labor, come next June, go up by about 15 per cent. Student debt is actually stopping young people from having a carefree life and having a bit of fun, at a time in their lives when they should be doing that. Students who are doing two to three jobs still cannot afford to pay rent; they still cannot afford to make ends meet. It is stopping them from pursuing hobbies, from socialising with their friends and from just being young people and enjoying their lives. Student debt, as I said earlier, is further entrenching gender inequality, with women having larger debts. And of course we know the gender pay gap is still a reality, where women earn much less.
Millions of people became worse off on 1 June when student debt was indexed by an astonishing 7.1 per cent. Now, for people with a debt, their debt is rising faster than it can be paid off.
Despite the problem being so acute and getting much worse, the government is sitting on its hands. The only thing it can tell you is: 'The university accords process—everything will go into this magic pot, this magic pudding, and let's see what it comes out with.' But the government has the jurisdiction to do something about a pressing higher education issue right now. They don't have to wait for a process which will take a year, and then years more to implement, if it comes up with some good recommendations. We're debating this bill here; you brought this bill here. This bill is not more important than actually dealing with the student debt crisis, so while the process is going on you can still bring on education bills and get them debated. Why not do something useful and actually help the students, rather than saying, 'Sorry, we can't do anything until the university accord is over'? Our higher education system, the way it currently stands, is setting up students to struggle. But we're not debating that. You stopped—you gagged—debate on our bill on that, but we're sitting here debating a bill about a start-up program. It will be useful for students, but it just adds to their burden.
The government can do so many more things right now than doing this. Like I said, get rid of indexation. There are students who are doing mandatory placements for weeks as they do their uni degrees—for months in some cases—which they're not paid for. They might actually have to give up their jobs to do that. Or they finish their placements at 5.00 and run off to another job at 5.30. The government can actually pay those students for doing the mandatory placements. The government can raise stipends for PhD students to at least the minimum wage. The government can extend paid parental leave to PhD students. The government can lower the age of independence from 22 to18, and raise students' social security payments above the poverty line to at least $88 per day. That's what we need to do. But, instead, while they can't afford all of that, the government have chosen to commit $368 billion for dangerous nuclear submarines and are gifting, on a platter, $313 billion to the wealthiest in stage 3 tax cuts.
Students do deserve a system which allows them to thrive and survive. Students deserve free education, whether they're leaving school, changing careers, retraining later on in life or looking to gain new skills and knowledge. Education is a right—that should be the basic tenet of this country. It is a public good, it is not a privilege! It is not reserved for those who can afford to pay. Like I said: ultimately, university and TAFE should be free and all student debt wiped. No-one—no-one!—deserves to be shackled with tens of thousands of dollars of debt which in many cases will take a lifetime to pay off in order to pursue higher education. I will be moving a second reading amendment to that effect.
Labor's lack of will to act on student debt and their weird kind of overprotective justification by saying, 'Oh, the current student loan system works,' are so out of touch with the reality of what people with student debt are facing. Labor needs to admit that this system is broken and that millions are suffering because of that broken system. Remember—you probably won't—that you were the party of the Whitlam government, which introduced free education and that our Prime Minister benefited from that. It is pretty shameful that the Prime Minister and this government aren't willing to allow the same benefit to people today. You can afford to act on student debt. The only question is whether you care enough to or not.
At the end of the motion, add ", but the Senate notes that this bill does nothing to mitigate the student debt crisis at a time when student debts are increasing at an out-of-control pace, and calls on the Government to:
(a) recognise that education is a public good which should be free and universal;
(b) make university and TAFE fee-free; and
(c) wipe all student debt".
I rise to speak on the Education Legislation Amendment (Startup Year and Other Measures) Bill 2023. I just want to reaffirm to those people who are listening to this debate, that we're actually in Canberra. We're not in Utopia, with the comments that are made constantly by the Greens party about the Labor government and the coalition. These are the very people who in this place this morning got into bed with the coalition to stop us being able to continue to debate the Housing Australia Future Fund—$10 billion that this government was putting forward for social housing. These are the same people that cry—
There's a home run as soon as they take a point of order because they don't like anyone coming into this chamber and putting the facts before the Australian people. And the facts are, whether you're talking about education or whether you're talking about housing, that when those two, the Greens and the Liberals—better known as the 'no-alition'—get together they cry wolf about social housing, but when they have the opportunity to vote on legislation for a $10 billion future fund then they come in here and talk about education. They start off saying that the Labor government and the coalition are in cahoots with one another. Make up your mind! The reality is we could today pass legislation that will enact a $10 billion future fund for social and affordable housing—right here, right now, we could do that—on top of the $2 billion the Prime Minister announced at the weekend. But what have we got from the Greens and the 'no-alition'? They have tag-teamed here to stop any further debate on the Housing Future Fund until October, so we will see 30,000 fewer homes being built at the behest of the Greens and 'no-alition'. That's what will happen.
Point of order: I think Senator Polley is really stretching the friendship. We are talking about education, not housing. I'd ask you to ask her to direct her focus on the bill before the Senate, please.
It's really good to hear that people are actually listening to my contribution not only on higher education but on housing, two of the most important issues to be addressed in this place. This bill will amend the Higher Education Support Act 2003, HESA, to establish a startup year program in our universities. The goal of education is the advancement of knowledge, of our communities and of society. We collectively know that the Minister for Education, the Hon. Jason Clare, has said that universities can change the world. Well, of course they can, and we are delivering legislation to support students going forward. These institutions are institutions of knowledge and progress. They assist society to move forward, and that is what this bill is aiming to progress.
Universities will be working hand in hand with startup ideas from concept to commercial application, through higher education based accelerator programs. Just as entrepreneurial enterprises and startups go together, so must startups and universities. A startup is a company that is in the initial stages of business, and the earlier that universities can have input into a startup business the better. In 2020 over 3,000 new jobs could be attributed to Australia's eight most successful startups. The Tech Council of Australia estimates new tech startups can contribute 30,000 new jobs and $7 billion in value by 2030. This equates to extraordinary capacity from a knowledge and jobs perspective.
As a Labor government we must support the development of the skills needed to drive startups and technologies of the future. Therefore, the Albanese government will extend up to 2,000 income-contingent loans each year to eligible students participating in higher education based accelerator programs. These will be programs which build skills in entrepreneurship and connect students with support, mentorships and facilities that are needed to develop the startup ideas, and I've seen some of those already in practice in my home state. Just recently I visited and heard some of the wonderful stories about that. Being able to mentor and give guidance is really important to new startups.
The loans will be available to final-year graduate students, current postgraduate students and recent graduates as new loan types under the government's existing Higher Education Loan Program. The amount of assistance will be tiered to the maximum student contribution amount for medicine, dentistry and veterinary science, which is set at $11,800 under funding cluster 4 of the Higher Education Support Act. The bill also provides for guidelines which will contain further detail on the operation of the loans, including the process of allocating loans and registering eligible accelerator courses under the program. As the minister stated, it is essential that places be prioritised for courses which demonstrate greater engagement with, and participation of, underrepresented groups. Among those groups are female entrepreneurs, First Nations Australians, people with disabilities and community based startups which are working on regional and rural issues.
In relation to that, I'd like to make a special note of my home state of Tasmania, which will benefit greatly from this project. Tasmania has been responsible for many successful startups, especially in the IT industry, so I welcome any collaboration which makes it easier for young Tasmanians to find meaningful employment in a field they are particularly passionate about.
Consistent with other HELP loans, Startup Year loans will be paid back through the taxation system once an individual's income rises above the compulsory repayment threshold. This means that people pay what they can afford and they don't pay more if they don't earn more. This measure ensures people are not deterred from studying, because we know the cost of living is the most significant issue facing Australians right around the country. This removes a significant roadblock to participation in accelerator programs and will encourage a broader, more diverse range of programs to be available to a larger cohort of participants. Eligible students will be able to receive a maximum of two Startup Year loans over their lifetime, and students who undertake an accelerator course and access a Startup Year loan will be able to access a range of student payments, as long as they meet the other criteria. The program will start with a pilot program commencing this year, in July 2023, with a full rollout in July 2024.
The bill will also amend the Australian Research Council Act 2001 to apply current indexation rates to funding for the 2022-23, 2023-24 and 2024-25 financial years and insert a new funding cap for the 2025-26 financial year, resulting in an additional appropriation to the ARC of just over $1 billion. As a government, we must ensure that the Australian Research Council can continue to support Australia's research sector by funding the highest quality of fundamental and applied research to deliver real cultural, economic, social and environmental benefits for all Australians. The measures in this bill will further the Albanese Labor government's commitment to supporting young Australians. Education, small-business startups and our universities are at the forefront of knowledge across the country.
Time and time again, we hear the Greens come into this place talking about education and saying, 'Everyone should have free higher education and free TAFE.' Well, in the last budget we invested in free TAFE for those areas of skills that we need in this country, because there was a complete lack of investment into skills and training by the former Morrison government. They neglected TAFE, and it's going to take some time to rebuild that. But what I really get a giggle out of is when the Greens come into this place and want to create a utopia. At a time when there's pressure on us with the cost of living, we made sure that money in the last budget was prioritised to those people who need it most. We want to invest even more money in housing because, quite frankly, if you don't have a safe roof over your head then it's very hard to go and be able to apply yourself, whether at primary school, high school, university or TAFE.
That's why it concerns me when untruths are circulating within the community about the fact that this government isn't there providing the money needed for social and affordable housing. Quite frankly, that is not true. A sign of the commitment that the Labor Albanese government made over the weekend for an immediate $2 billion to be shared around states and territories to provide social housing should convince the Greens and their supporters that we're serious about this. This is why I'm so passionate about them getting out of the way of this legislation. Ten billion dollars for a future fund for social and affordable housing is critically important. What the Greens failed to do—
I certainly have. And somebody's been reading their standing orders. Well, you hit the mark. The opposition are well known for it. I love it, quite frankly. They've been here for a while now, and they don't seem to get an understanding of it. When you either interrupt me or take a point of order, it's fruitless. Because there's no standing order on being able to talk about a bill that is already on, and I had started my speech on that. But this morning it was the 'noalition' and the Greens that stopped me from being able to speak on that very bill.
I consider housing a secure home for those people most in need. It's a fundamental right for them to have it. But the delay that the Liberals, Nationals and Greens have supported today will put off that debate until October—and we are just at the beginning of winter. I see in my home state, particularly in Launceston, because I've been delivering food and knitting scarves for homeless people, how many people are actually living in cars or in tents. I would never admit this outside of this chamber, but sometimes Launceston gets as cold as Canberra. What we really need is immediate support. We need the Greens and the 'noalition' to get with the program and vote on that legislation.
We need more money to go into education. But the government has come in after 10 long years of neglect of the education system. In just about every state, from primary school to high school, our education attainment and the level of literacy is going down, even here in Canberra. I heard it on the news. In the national capital of this great country, literacy is going down. That's right here in Canberra. So I will always get up and speak about those issues that I believe are really important. Education is so important. If you don't have an education, you don't have skills and you don't have a house or a secure place that you can call your home. It doesn't have to be grand; it has to be your castle. Wherever and however that's constructed, that is your place of refuge. Every Australian deserves to have that peace of mind.
That's why I'm so passionate about those on that side. They left an enormous mess and a huge debt that generations will be paying off. But, time and time again, we have come in and said that we are open, transparent and putting people first. To do that and to deliver on our election commitments means that those people in this chamber need to respect the Australian people who voted for a Labor federal government. Let us do our job. Don't play politics. For the Greens wanting to come in and turn this place into a utopia again, it's not going to happen. That's not the real world. You might want to have these clips for your social media, but it does not put a roof over people's heads—it does not! Coming in here trying to claim that you're the only people who have a heart and think about those who are less well off is quite frankly disingenuous to other people in this chamber. All of us in this chamber—well, most of us, anyway—come here with the best intentions. We do, absolutely. I commend this bill to you, and I urge those people on the other side not only to support this bill but to reconsider the housing future fund. (Time expired)
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.
I rise to speak to the Education Legislation Amendment (Startup Year and Other Measures) Bill 2023 in support of initiatives aimed at encouraging young people to start new businesses. Entrepreneurship is a trait that should be celebrated at every opportunity. We are facing some really big challenges in our communities, in our society and, indeed, globally: encouraging young minds to look for solutions, not only encouraging but supporting them in doing so, ensuring that they have the support necessary to bring these ideas, these dreams, into reality.
The ACT does a good job of this. We have the highest rate of new startups per capita in the country. Canberra is on track to become a world-leading innovation hub, a model city where we see a high degree of collaboration between multiple levels of government, some of Australia's best universities and research institutions, and a proud business community fostering a forward-thinking entrepreneurial culture. CBRIN, the Canberra Innovation Network, is doing fantastic work supporting a robust variety of early-stage startups here in the ACT. Their return on investment has been independently assessed as 50 to 1.
Like many of the local entrepreneurs I've met, I would love to see further investment in their programs from both the territory and federal governments. The ANU, University of Canberra and UNSW Canberra are all working actively in the commercialisation of local research. They are producing impressive spin-offs in areas like high-tech recycling, advanced manufacturing and precision fermentation. The Australian Catholic University and Charles Sturt University also have active business incubator programs based out of their interstate campuses. They've also expressed interest in increasing their engagement with Canberra's innovation ecosystem.
My consultation with these institutions has indicated in principle support for the intentions of the startup year initiative. Concerns have been raised, however, regarding the design of this program. Every accelerator program I'm aware of in Canberra is currently provided to participants for free. As Senator O'Sullivan pointed out, it's often funded by wealthy philanthropists who believe in young entrepreneurs, who believe in providing entrepreneurs with an opportunity and the support that they need. But they don't pay for it—because, as we know, as has been pointed out in this debate, a small fraction of startups are actually successful.
What we have here is a proposal that requires universities to start charging for these courses. We're going to take free incubators, start charging and, at the end of it, you're going to have a HECS debt. And maybe you don't end up with a small business. The intent has to be around getting startups off the ground, and I don't understand why we're introducing a debt facility for something that's currently free.
I understand this was an election commitment from the government. It sounds like a great idea when you first hear it but I believe the legislation, as it's been written, misses the mark. Its stated objective is 'to develop a person's skills, capabilities and connections for startup businesses'. But will it actually develop any startup businesses? We will likely see a number of startup courses, popping up at universities across Australia, with no assurances regarding their quality or whether they can deliver outcomes that we should be focused on, that we should be seeking here, which is more young people starting businesses.
There's also a risk that resources are pulled away from the existing accelerator programs that are already doing a great job for free. Canberra is home to some of the brightest minds in Australia—indeed, in the world—and our community wants to see those minds and their ideas funded and supported. Sending students further into debt so that they can be educated about startups, rather than funding their startups, doesn't make a whole lot of sense to me. I believe there's a strong case to instead see this money given directly to students with innovative ideas to help them turn their great ideas into exciting new businesses. This is actually consistent with Labor's initial policy announcement.
Again, I agree with the intent of this bill. It is good. We do want to drive innovation and we do want more start-ups, but what we see here is young entrepreneurs and students having to get into a course that then results in a HECS debt, rather than actually encouraging universities, and providing the support, to provide their students who are entrepreneurial and want to have start-ups spin out of the university with opportunities that are free, because we know that there are huge risks in the start-up ecosystem.
I think there is also an opportunity to support the excellent programs that already exist in this space and have a proven track record of producing new start-ups, like those run by CBRIN here in Canberra. It has a 50-to-one return on investment. They work with universities and provide expertise. They have successful entrepreneurs volunteering their time and mentoring. They are creating an ecosystem that is conducive to young people seeing their ideas become reality.
I understand that there have been a number of amendments circulated on this. I will continue to engage with the crossbench in these discussions to ensure that we do support young entrepreneurs and universities that are helping their students make their ideas into start-up businesses that are helping solve some of the huge challenges we face—start-ups that are pioneering new fields and creating new opportunities for us, such as quantum computing. We have start-ups here in Canberra looking at the recycling of plastics and other materials that are currently not recyclable. We have people doing innovation in food. There are a huge number of start-ups worthy of support. I have real concern with the potential founders going through an accelerator program and having a big HECS debt that they will one day have to pay off, with no guarantee that that start-up will actually be successful.
I rise to speak to the Education Legislation Amendment (Startup Year and Other Measures) Bill 2023. I commend the fantastic work of the Minister for Education on this outstanding piece of legislation that I know will improve the lives of thousands of Australians for years to come. This bill seeks to amend the Higher Education Support Act 2003 to create the Startup Year program, which is designed to support students participating in accelerator program courses as part of the Higher Education Loan Program, known as HELP.
The new Startup Year HELP is estimated to support up to 2,000 students and recent graduates each year, with a pilot program commencing in July this year and a full rollout in July 2024. Eligible students include those who are in their final year of an undergraduate degree, are enrolled in a postgraduate course or were awarded a qualification at the bachelor's degree level or above in the last three years. Importantly, the program will target support and prioritise underrepresented groups such as women entrepreneurs, First Nations people, people with a disability, and community-based start-ups working on regional and rural issues. The bill will also amend existing social security and student assistance legislation to allow Startup Year HELP funded students participating in accelerator program courses to potentially qualify for student social security payments, update and add funding caps for approved research programs, and apply indexation to existing amounts.
Estimates from the Tech Council of Australia found that 30,000 new jobs and $7 billion in value will be generated by new tech startups by 2030. That's why the Albanese Labor government is being proactive about supporting our thriving startup industries. Thanks to Labor's new Startup Year program, current students and recent graduates will have great opportunities to build important skills in entrepreneurship by connecting them with the support, mentorship and facilities they need to develop their startup ideas. In my state of Victoria we are home to a number of successful innovative startups including Linktree, Mr Yum, Zella and Startup Gippsland. They play a critical role in creating domestic jobs and commercialising brilliant ideas.
This bill is backed by the mandate of our constituencies because Australians want to see improvements in access to higher education. The new Startup Year HELP loan removes a significant roadblock to participation in accelerator programs and will encourage a broader, more diverse range of programs being made available to a larger cohort of participants. This bill strikes at the core of one of Labor's most renowned values, providing an education that is accessible and equitable for all. We are investing in a better and fairer education system because that is what Labor governments do—in fact, it is what we do best. I am so proud to be a part of the Albanese Labor government, which is supporting Australian students to upskill to expand their knowledge and experience and not forcing them to be out of pocket just to get the education that they need for the jobs that they want.
Labor's Startup Year program for budding entrepreneurs is just one example of our commitment to improve equitable access in our education institutions. This May's 2023 budget also saw $32 million in grants to update schools across the country. More than 20 local schools in my home region of Mallee, in regional Victoria, are set to benefit from Labor's budget. We are delivering better infrastructure and better equipment to help students right across Victoria achieve their best. Growing up in regional Victoria, I know firsthand that students and graduates in regional and remote communities don't have equitable access to education and especially don't have the same access to higher education based accelerator courses. Whether it is our new Startup Year program for budding entrepreneurs, providing fee-free TAFE courses for Victorians or improving school infrastructure and equipment across the country, the Australian people can rest assured that Labor is committed to improving equitable access to our education institutions. I commend the bill to the Senate.
In rising to speak to this bill, the Education Legislation Amendment (Startup Year And Other Measures) Bill 2023, I want to put on the table that there is absolutely no doubt, 100 per cent, that students need support. Students are doing it incredibly tough: students trying to live on the student allowance, students trying to live on the youth allowance, students struggling with having to work virtually full time and do full-time studies at the same time. They have got to work full time just to be able to afford to pay the rent, so there is absolutely no doubt that students need a huge amount of extra support. The question is: how should this support be given? And there are so many other ways that we could be supporting students. The Greens are supporting this bill because you can't stand in the way of extra support for students, but it is not to say that we think that this is the most appropriate way for us to be supporting the students. There are so many other ways that we could be supporting students.
One way of doing it to begin with of course would be to wipe student debt, but, rather than wiping student debt, what is this government doing? They are putting it up. The average student debt of $24,770 is going to rise by $1,758, and, for more than half a million people who have got debts of around $40,000, it is going to add another $2,840 to the student debt. If you are a student, you are struggling; you can hardly afford to eat, and you know that when you leave your studies you are going to have this massive debt that you have got to be able to cope with. But, at the same time as you are going to continue to be paying skyrocketing rents let alone thinking that you may be able to afford to buy a house, you have got this massive burden around your neck. There is so much that we could be doing to be helping students and setting students up for a positive life ahead. But, instead, what's happening is that there are so many people that are choosing to abandon their studies, even with supports like this, which I'm sure would be welcomed, because they cannot afford to continue studying. During the poverty inquiry, which I am chairing, we have heard story after story of students who are saying just how tough it is and how they want to be able to keep studying but they just can't afford to do it.
The other thing that we could be doing, of course, is making tertiary education free, or making all education free. I think back on my student years—yes, some 40 years ago now. We are a richer country now than we were 40 years ago. So why is it that 40 years ago I was able to get a tertiary education completely for free and today students are ending up with massive loans around their neck? All that this legislation before us today is going to do is increase the massive loan that they are going to have to lug around when they leave their studies.
I really want to commend my colleague Senator Faruqi for her important work on this piece of legislation, both through the Senate inquiry into this bill and through the amendments that she has circulated. She has foreshadowed an amendment to the second reading motion for this bill that calls on the government to wipe student debt, which would make a genuine difference to many students and graduates. I really urge the government to act on this issue because, if we want to be helping students, that would be a massively significant way to help them rather than adding to their debt burden.
The other thing that the government could be doing is raising the rates of student allowance and youth allowance above the poverty line. Nobody deserves to be living in poverty in this country. If you are studying, you cannot do your best at your studies if you are living in poverty. Even with the poverty payments of student allowance and youth allowance, too many students are locked out of them by an unfair system. A survey done by the National Union of Students found that being locked out of youth allowance negatively impacted students' financial wellbeing—86 per cent of the survey respondents said that—their mental health, according to 65 per cent, their education, according to 60 per cent, and their experience of domestic or family violence.
I want to share some of the direct accounts that were gathered by the National Union of Students in their powerful report. Jesse, aged 23, said: 'One day, a friend and I were having a chat about how much youth allowance and other payments from work we were receiving, and we realised that we were living way under the poverty line. That's when it really hit me that this isn't the way that I should be living right now.' Darcy, at the age of 23, said: 'Receiving the COVID supplement'—which, of course, was when allowances were above the poverty line—'was the first time in my life that I experienced financial stability, which was a real revelation to me. It's actually this easy to not suffer, and this is the choice that this government is making.' Sarah, aged 23, said: 'Receiving the COVID supplement in 2020 meant that I didn't have to stress so much about work and losing my job. My grades actually went up a lot during that period because I was able to focus more on my degree.'
I think it's really worth paying attention to this. If we as a country want to be doing our best—if we want to be building the skills, building the knowledge and building the workforce of the future—we need to be making sure that our students have got the ability to do their best. Currently, living in poverty and being burdened by massive amounts of debt is not the way to encourage students to be their best or to keep at their studies.
Another student said: 'If I'd received youth allowance payments, I would have probably, as a disabled person, been able to work less and focus more on my education. I ended up having to study part time and take time off in order to work and pay rent.' This is such a common story. Darcy, aged 23, said: 'The scariest part of it was that I needed to get verification from my parents that it was unreasonable for me to live at home.' That is a ridiculous barrier that people face in accessing youth allowance. Often, when it's not safe for people to live at home, it's difficult to get that proof, and people usually won't even have a relationship with their parents.
We can do much better than this. The choices that this government made are just that—they are choices. We could be choosing differently, just like 40 years ago: it was a choice that the government—