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Tuesday, 14 October 2003
Page: 21371

Mr HARTSUYKER (8:01 PM) —I rise to speak in this cognate debate on the Higher Education Support Bill 2003 and the Higher Education Support (Transitional Provisions and Consequential Amendments) Bill 2003. Higher education is an important sector which makes a very significant contribution to Australia's national economic growth and development. It also makes a great contribution to regional economic growth. On 2002 figures, 81,000 people worked in the higher education sector, producing $11.2 billion in revenue. I commend this government for taking a leading role in reforming education. The reforms are founded on the understanding that the higher education sector provides jobs for Australians, provides education for our future work force and develops the future leaders of this country. I commend the Minister for Education, Science and Training for his leading role in this reform process.

Dr Nelson announced in April 2002 the review into higher education policy in Australia. The Crossroads review took in a number of forums throughout Australia and developed into the government's Our Universities: Backing Australia's Future initiative. As the House knows, this initiative formed a major part of the recent budget. The principal bill contains a number of major elements. It proposes a new Commonwealth Grants Scheme for universities whereby, from 2005, grants for universities will be based on a new funding regime based on student numbers and discipline mix. Around 25,000 marginally funded places will become fully funded in the three years to 2006-07. There will be 1,400 additional places provided in 2007. These measures will cost $139 million in 2003-04, $252 million in 2005-06 and $384 million in 2006-07. These are substantial investments in education. The government's program also includes 210 new fully funded nursing places in 2004.

I particularly welcome the initiative of the minister on regional universities, which will be enacted under this legislation. The initiative recognises that the universities which are providing places at campuses located in regional Australia generally face higher costs as a result of their location and size. From 2004, the federal government will provide $122.6 million over four years in additional funds to support these regional campuses. I particularly welcome what these measures will mean for higher education in the electorate of Cowper. The Coffs Harbour campus of Southern Cross University will receive the highest loading, 7.5 per cent, outside the Northern Territory.

Southern Cross University is an important institution in regional Australia. It has specifically dedicated itself to serving the community of the New South Wales North Coast, and that notion of servicing the north coast is very much a part of Southern Cross's development strategy. I commend it on that. Southern Cross University was formed in 1994, but its origins stem from the Lismore Teachers College of the seventies. The Coffs Harbour campus of the university now has around 800 students. It is an important part of the local economy and our community. It offers a range of courses and opportunities to undertake studies locally in our area.

The vice-chancellor of the university, Professor John Rickard, welcomed the regional loading. He said:

Regional universities make a substantial contribution to our communities, cultures and economies. But we and our students are often at a disadvantage because of our location and size. The budget recognises that situation and attempts to address it.

On the funding budget announcements, he went on to say:

This means we can look to improve and develop programs, perhaps offering components of courses for the first time at the Coffs campus, or perhaps expanding the range of units already offered.

I am pleased to concur with Professor Rickard's comments. These measures will indeed offer a great deal of opportunity for study in Coffs Harbour, and I commend Vice-Chancellor Rickard's remarks to the House.

The measures in these bills have further benefits to Southern Cross University at Coffs Harbour. By way of background, I arranged a meeting earlier this year between the minister for education, Dr Nelson, and both Professor Jenny Graham, dean of the university's health faculty, and Dr Jim Curran on courses being offered at Coffs Harbour. I thank Dr Nelson for his recent announcement of 41 nursing places for the Coffs Harbour campus, which will be in addition to the 20 nursing places that have already been promised by Southern Cross. I also take this opportunity to commend the great work Professor Graham, Dr Curran and Mr Warren Grimshaw are doing for nursing, aged care and health at Southern Cross University's Coffs Harbour campus.

These bills, as part of the government's Our Universities: Backing Australia's Future package, will provide for a new framework with greater flexibility and capacity for diversity for tertiary study. Educating nurses in regional areas is a really important step towards addressing nursing levels in regional Australia. It also offers a great career opportunity to people living outside metropolitan centres, and the benefits will in time be felt in our local community. These bills will allow a system of national priority areas to be put in place. They will allow the federal government to respond to current and emerging national needs, such as shortages in particular sections of the labour market. Teaching and nursing have already been identified as key areas of national priority. The Coffs Harbour announcement is part of an additional $40.4 million of federal funding over four years starting next year. A total of 574 places in nursing will be allocated to regional campuses. There is also additional expenditure on teaching from the federal government over three years commencing in 2005.

A major part of the Our Universities: Backing Australia's Future initiative involves reforms to the Higher Education Contribution Scheme and changes to the current system of three HECS bands. These bills propose to replace these bands with ranges from 2005 onwards. There will be relief for students with the increase of the minimum repayment threshold for HECS from $24,365 to $30,000. The top end of the repayment threshold also rises to $60,000 from the current $44,000. The new arrangements will be called HECS-HELP and there is also a regime of contingent loan schemes for students paying full fees and for students undertaking study overseas for one or two semesters.

There is often much discussion on the effect of HECS on participation in higher education. Findings from a couple of studies into this issue are certainly noteworthy here. In his paper DoesHECS Deter? Factors affecting university participation by low SES groups, Les Andrews wrote:

HECS does not appear to have substantially affected the level of applications or enrolments in general.

Andrews noted in that report that the main factors determining university participation were values and attitudes towards higher education, as opposed to financial considerations. I think that those remarks are very interesting, and they are supported in other sources.

A report entitled Income contingent financing of student charges for higher education: assessing the Australian innovation of May 2002 also concluded that the introduction of HECS had not produced any adverse effects on participation. Particularly interesting in that report was the finding that HECS did not result in any fall in participation by prospective students from relatively poor families. Of course, those people who undertake tertiary studies receive substantial lifelong benefits and opportunities from such education.

Using 2002 figures, HECS accounted for about 20 per cent of the cost of higher education in Australia. The community and the economy as a whole benefit greatly from the skills and qualifications acquired by graduates and pick up a great deal of the tab for the cost of obtaining those skills and qualifications. I believe the community would have to agree that a system like HECS, where students contribute to the cost of their education, is a fair system for the community overall.

There are arrangements in this legislation to assist students. It introduces two new scholarships. Over four years from 2004, $84.4 million will be spent on Commonwealth education costs scholarships. These scholarships will provide $2,000 per year for low SES students and Indigenous students undertaking full-time tertiary studies. The second scholarships scheme, the Commonwealth accommodation scholarships, will provide $4,000 each year for up to four years for students from regional and rural areas who have to relocate to undertake their university studies. The Commonwealth accommodation scholarships, at a cost of $75.8 million, are targeted at assisting students from low-income backgrounds. It is a measure which will help parents and help students from regional areas who want to take up study in another location. It will certainly open up a door of opportunity for them where that door might now be closed. There will be 1,500 accommodation scholarships available next year under these bills, and that will rise to over 2,000 in 2007.

Under Our Universities: Backing Australia's Future there is a series of incremental increases in the per student funding to universities—from 2.5 per cent to 7.5 per cent by 2007. As a result of this measure, $404.3 million extra will be spent in universities on student places between 2005 and 2007. The proposed increases are over and above the current indexation arrangements. They are contingent on reforms to university workplaces and governance. Those reforms form a key element of the government's package and they demonstrate a fundamental commitment to choice in agreement making and to genuine freedom of association. Universities will be encouraged through a new workplace productivity program to pursue broader workplace reform which more effectively utilises the provisions and flexibilities provided for under the Workplace Relations Act.

Our Universities: Backing Australia's Future also introduced measures of quality assurance targeted at protecting Australia's international reputation in higher education and the integrity of courses. The education export market is currently worth $5 billion a year to our economy. It is vital that we maintain the international reputation of Australia's higher education sector to ensure our graduates continue to receive world-class skills to compete in the global economy and to protect Australia's position in the export of education.

Quality assurance will be monitored from 2005 by an Australian universities quality agency. That agency will be tasked with carrying out audits of overseas higher education provision nationally. Employers will be given improved access to information about the capabilities of recent graduates through the enhancement of the graduate skills assessment program, and students will be given ready access to information on the institutions to compare them with each other through enhancements to the graduate destination survey and the course experience questionnaire.

The review into higher education found that there was a tendency for some universities to go too far and to overutilise their marginal capacity. The findings of the report suggested that this was happening to the point where it was threatening the potential educational experience of many students. There were overextended staff and facilities. There are problems with universities continuing to overenrol at unsustainable levels. I therefore welcome the minister's announcement that the government will work toward addressing these concerns through the development of standard criteria so that resources are equitably allocated. It is certainly an issue of making sure that the taxpayer-supported Commonwealth places in our universities are accountable and the expenditure is equitable. Proper accountability is essential to ensuring that the community gets value for the large amounts of public moneys it provides for universities and that the recipients of those funds are held accountable for their expenditure.

The new institutional assessment framework will support the Commonwealth's commitment to reducing the amount of reporting required of universities. For a large part, the data for the assessments can be drawn from information already produced by higher education providers or already routinely collected from universities. The framework will apply to all institutions receiving Commonwealth funding and is founded on the Commonwealth's responsibility to ensure that institutions are sustainable and able to deliver and make good on the outputs for which they are funded for their students. It also ensures that these outcomes are of a high quality and that they comply with the legal requirements and obligations. The framework will allow the assessments to take place in a bilateral manner between the Commonwealth and each individual university.

The main provisions of these bills include the grandfathering arrangements for current HECS-liable students until the end of 2008. Those grandfathering arrangements apply to both pre-1997 and pre-2005 students. Students with PELS loans will also have the grandfathering arrangements until the end of 2008. HECS debts will be converted into HECS-HELP from 1 June 2006. Transitional arrangements are provided for the University of Notre Dame Australia and Avondale College to allow Notre Dame to receive Commonwealth Grants Scheme funds for places which are not in national priority areas—teaching and nursing—up to and including the 2008 calendar year, and to ensure that Avondale College receives national priority places for its grandfathering HECS students up to and including the 2008 calendar year.

Appropriations in the Higher Education Funding Act, HEFA, are to be necessarily adjusted. There is an increase in the section 17 appropriation for 2004 to enable the increase in support for regional student places and increased support for nursing as a national priority; an adjustment to the section 23C appropriation to include funding to support the General Sir John Monash Awards and the Indigenous Higher Education Advisory Council; and further adjustments to increase the other appropriations in 2004 under the act for the indexation of parameter changes. The government provides for a transition fund to help universities adjust to the new regulatory and funding environment over the 2005, 2006 and 2007 calendar years.

There are consequential amendments to the Bankruptcy Act to ensure that Commonwealth debts incurred under the new legislation are not discharged in the event of bankruptcy. Student contribution amounts paid by Commonwealth-supported students are not tax deductible, but tuition fees may be tax deductible and there are consequential amendments to the Income Tax Assessment Act 1997 to reflect this and to clarify the deductibility of fees under the new funding arrangements.

I also welcome the introduction of the Higher Education Support Amendment (Abolition of Compulsory Up-front Student Union Fees) Bill 2003, which is within the scope of this debate on higher education and which proposes to enact the Commonwealth's voluntary student unionism policy. That bill proposes to prohibit universities from making membership of a student association a condition of enrolment and from collecting any amounts as a condition of enrolment that are not directly related to a student's course of study. It is interesting to note that the only up-front fees students face are the compulsory up-front student union fees. All other fees are deferrable.

It is ironic that Labor would argue that HECS deters prospective students, when the payment can be deferred, but block the removal of the only up-front impediment—compulsory student union fees. Their cousins in the New South Wales Labor Party earlier this year imposed a huge increase in up-front fees for TAFE students, which will deter many would-be TAFE students from undertaking studies that are important for their professional and career development. It will not help them build their skills. It will not help them find jobs. In contrast, we want to get rid of up-front fees which burden students. Freedom of association is vital. Making students pay up-front compulsory fees is not in the interests of students and prospective students, and I welcome the measures laid out in that bill.

Division 36 of the principal bill, the Higher Education Support Bill 2003, sets out a number of important provisions. Section 36-10 ensures Commonwealth-supported students are Australian citizens with a student learning entitlement. Only students who qualify as Commonwealth-supported students are enrolled in Commonwealth-supported places. Section 36-30 provides that providers must fill Commonwealth-supported places before accepting other enrolments. Under section 36-35, at least 50 per cent of the places in an undergraduate course are Commonwealth-supported places. Under section 36-45, providers must not charge more than the appropriate student contribution for Commonwealth-supported students.

Commonwealth-supported students who pay up-front receive an up-front payment discount, paying only 80 per cent of the contribution amount. That is provided for in the proposed section 36-50. Universities must meet the quality and accountability requirements under section 36-60 and they must comply with their funding agreements and the Commonwealth Grants Scheme guidelines under sections 36-65 and 36-70. Parts 2-3 and 2-4 provide for the new scholarships program and other grants. Division 73 sets out the provisions for the student learning entitlement for Australian and New Zealand citizens who are permanent residents here. Parts 3-2, 3-3 and 3-4 set out the operation of HECS-HELP and the loan schemes FEE-HELP and OS-HELP—overseas study help. Chapter 5 deals with a number of administrative matters.

In the long term all universities and therefore students will be better off under the proposed program, Our Universities: Backing Australia's Future, and the measures contained in the principal bill and the consequential amendments we are debating today. The package contains transitional assistance to help universities adjust to the new funding and regulatory requirement frameworks. The Commonwealth contribution will rise 7.5 per cent. The new Commonwealth Grants Scheme will replace block grants and provide funding on the basis of the number of students and the discipline mix. HECS students will still be able to defer their fair contribution to their education. The expenditure of public funds will be more accountable and equitable. There is a range of measures that will provide great direct benefits to our regional communities. Higher education as a sector makes a substantial and important contribution to our national economy and in our communities. It provides great opportunities for people to advance themselves. It is important that the higher education sector is supported, and these bills do exactly that. I commend the bills to the House.