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Wednesday, 30 October 1996
Page: 6200

Mr McCLELLAND(6.54 p.m.) —A little earlier in the debate, the member for Chifley (Mr Price) spoke of the trauma of a number of students undertaking their higher school certificate exams. He said his heart went out to them, as does mine. I remember that as a particularly stressful period. Indeed, in cross-comparisons of stress, it was far more stressful than even a Labor Party pre-selection. It is quite a traumatic time. The fact of the matter is that all students are undergoing equivalent stress. Next year that will be somewhat different—at least for 25 per cent of the students.

Before this period of late October and November next year, the universities will want to know their funding base for the following year. They will want to know that they will be funded for the 25 per cent of fee paying places which they will now be allowed to introduce as a result of the Higher Education Legislation Amendment Bill. We can rest assured that those universities will admit students on the basis of their assessment prior to undergoing the HSC. So some 25 per cent of students will be able to breathe a sigh of relief and feel a little less stressed because they will have secured a university place. Literally, those 25 per cent of students will be those whose mums and dads bought their places.

On 26 October at a Liberal Party convention, the Prime Minister (Mr Howard) said that under the government's plans Australian students would be able to do what their overseas counterparts could currently do and buy a university place, in addition to having access to funded places subject to HECS. But it is those 25 per cent of places which will be bought that will give some students a significant advantage or privilege in life.

As the member for Watson (Mr Leo McLeay) said, not too many of those students will come from our electorates. They will come from the north shore, the eastern suburbs and the wealthy areas. Regrettably, we are introducing a significant demarcation based on privilege. The remaining 75 per cent of students will have what would otherwise be 100 per cent of places available to them reduced by 25 per cent, because those 25 per cent of places will be sold from underneath them. On any objective analysis, that is chronically unfair and, indeed, a significant retardation of the future and universal development of Australia's talent base.

Most of us here are familiar with the background to the higher education contribution scheme. It was introduced as a result of a recommendation of the committee on higher education funding in April 1988. The principle behind the HECS was that education was not only to the public benefit but it also bestowed a private benefit in access to career opportunity and hence it was appropriate for students to contribute something to their own education. That has pretty well obtained universal acceptance.

But the challenge, successfully met, was in keeping the HECS level at one which did not preclude or impose an undue financial burden on students such that, provided all Australian students, as the member for Watson said, satisfied the merit test of academic achievement, they could access university and hence open the door to their dreams and career aspirations. The repayments required under the Labor government's regime did not lock into place until those aspirations were realised—until the student reached a level considerably above average weekly earnings.

This government has reduced it to a level of even below basic minimum award conditions today. Virtually as soon as a student leaves university, even if they have a particularly low paying job, they will be required to start locking into the repayment regime.

The explanatory memorandum to the bill says that current students—those enrolled pre-1997—will not have any unanticipated fee increases. Their current costs will be frozen. That just is not the case. There are 750,000 people with HECS obligations, together with about 400,000 current students, and perhaps as many users again of the higher education system since 1989. Because the threshold has been lowered from approximately $28,000 to $20,000, the obligation to repay is going to be locked in much earlier.

The Australian National University has estimated that the obligation to meet the earlier payment deadline will cause increases of between five and 12 per cent to the HECS debt of existing students. It is unquestionably a misrepresentation to say that current students will not be affected.

On pure numbers participating in this debate, the opposition would win hands down—there were only four speakers, together with the Parliamentary Secretary (Cabinet) to the Prime Minister (Mr Miles), for the government. That is an indication in itself, one surmises, of the uneasiness many genuine government backbenchers have with the government's actions. The rationale for this bill, given by several speakers, including the Prime Minister, is what the Prime Minister said to the Liberal Party convention on 26 October:

What is the social justice of saying to a person on $30,000 a year whose children don't want to go to university . . . we are going to use your taxes to ensure that people on $150,000 a year don't have to make any contribution to their children's university education.

That is just a silly analysis in the first place because less than one per cent of wage earners earn $150,000. Presumably you are talking about less than one per cent of the university population.

Fundamentally, the Prime Minister's comment is extremely short-sighted. People earning $30,000 a year would say, `We appreciate that we are in a very competitive world.' Education has given Australia a very significant competitive advantage. We are all in it together. The interests of Australia are our interests. It is why our manufacturing base is based on technology and skill. It is why, if I become ill, I will have access to high quality and technologically advanced medical treatment and skilled medical practitioners. We have scholars teaching languages and the social sciences so that we can relate with the rest of the world and, hence, participate as a member of the international political community and the international trading community.

It all arises from education. The more talented your people are, the more successful a nation has to be. Even though one's children may not be going to university, everyone benefits from other children going to universi ty because of the effect it has on our overall skills base.

Most Australians are intensely proud to see their next-door neighbour's children go to university. I frequently go to functions and am met by name-droppers—name-droppers in the most pleasant sense: aunties and uncles name-dropping their niece or nephew who has been admitted to university. They are intensely proud of that fact, and so they should be.

The Prime Minister's comment that there is some sort of resentment on the part of lower income earners to make a contribution, however slight that may be when compared with the totality of overall government expenditure, to develop the skills base of other children, is extremely short-sighted. He is fostering—with respect—selfishness and, what is worse perhaps, it is the commencement of fostering division and resentment. That is an unhealthy thing to introduce into Australian society. It has not existed up until today.

The structure of the bill itself is based on an extremely complex banding system. The member for Watson went through that charging structure. Basically, HECS contributions will jump from $2,487 currently to $3,300. If a student is undertaking computing or a science course, that figure will jump to $4,700. If a student is undertaking law or medicine or one of the government's perceived high income earning courses, it will jump to $5,500 or the equivalent of $11,000 gross for a family's budget, depending on their income level.

Whatever it is, in anyone's book, $5,500 or $11,000 over a five-year period, if they are undertaking law or medicine, it is a significant additional burden that a young person will have as soon as they finish university. That is a time when they are thinking about setting up a practice and possibly thinking about setting up a home. It will be a significant disadvantage for very many Australians. Again, it will not be for those who are fortunate enough to have their parents pay the HECS contribution—but there would be very few students in my electorate who would have that luxury.

The reality is, as a number of speakers have pointed out, that already there has been a decline of about 8.25 per cent in the number of students from New South Wales and the Australian Capital Territory who have applied for university places. An article appearing in the Sydney Morning Herald of 4 October this year reported a spokesman for the Minister for Employment, Education, Training and Youth Affairs, Senator Vanstone, as agreeing that that drop could be put down to the higher HECS charge. That was an astounding admission. It indicated the commencement of a fundamental structural change in the skills base of the nation. Effectively, in one year, the government has caused, by its cuts, an 8.25 per cent reduction in the potential future skills base from New South Wales and the Australian Capital Territory alone.

That will have a significant effect on teacher education, particularly on those in the expensive band subjects of science and computing. On 2 October this year, the Minister for Schools, Vocational Education and Training, Dr Kemp, said that the government would begin a review of the university education of teachers. On 23 October he was reported on the ABC's 7.30 Report as saying that Australia would face a teacher shortage by the year 2005. Indeed, Barbara Preston, a researcher for the Australian Council of Deans, has said that there will be a 5,000 teacher shortage by the end of this decade.

In that context, what is happening in my electorate of Barton with the St George Campus of the University of New South Wales is particularly alarming. As a result of the government's cuts—although we are still waging the fight—it looks as though the days of the campus could be numbered, and it is one of the premier teaching institutions in Australia, indisputably so in primary education and in the technology it utilises to assist primary teachers to communicate with their students.

In a document prepared by the University of New South Wales called Options 2000, the university said:

The issue of the Government's Budget statement on higher education has dealt the University an enormous challenge to survive and prosper in the face of significant funding cuts.

Lest there be any doubt that the government's actions have caused those problems, I can say that they certainly were not there until this government's budget cuts—some of which are to be implemented by this bill—came into force.

The whole shift in the higher education policy has meant that universities will become effectively private enterprises chasing the dollar. Obviously, if you are going to attract the dollar, you need to market yourself. Hence, in this Options 2000 document, there is a reference to the need to attract high quality students. It says:

The University of New South Wales' ability to attract high performing students will be reliant on its national and international image as a university of substance with high educational standards.

Later in the report it says:

It is the belief . . . that students are attracted to a university which is seen to contain only the most prestigious faculties and the most able staff.

The emphasis of these universities, of necessity—because they are being transformed overnight into private money-making ventures—will be prestige and image. They are not about educating our future talent base as required by our society generally; they are about concentrating on the glamour courses because the glamour courses attract those funds.

Regrettably and, I believe, short-sightedly, the University of New South Wales does not see the St George Campus as a glamour course provider. Nonetheless, it is these cuts which has caused the trauma to the university system. By and large, it is the regional universities which will suffer in the short term but, longer term, the inequality being introduced into our education system and the reduction in access to training will affect the talent base of the nation as a whole.