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Tuesday, 12 September 2017
Page: 10078


Mr WALLACE (Fisher) (16:21): I rise to my feet to speak on this bill with great joy and gusto. I'm so pleased that the Assistant Minister for Vocational Education and Skills is here to be part of this debate. I want to welcome the students from Narromine Christian School in the gallery up there. I'm not quite sure about the school behind me, but the young students up there are our future and education is all about them.

They could be—if they've been sitting in here listening to the matter of public importance—forgiven for thinking all sorts of things about where we stand as legislators on this issue. But before I embark on a detailed examination of the bill before us, I think it's important that we also look at a little bit of history. The Turnbull government has taken responsible measures to try to end the rorts of the VET FEE-HELP scheme that saw such a debacle from those opposite when they were in government. Let me just give you a few statistics, Mr Deputy Speaker: between 2009 and 2016 the number of students accessing the VET FEE-HELP jumped 3,600 per cent, from 5,229 to 193,868. Now, you might think, 'Well, is that such a bad thing?' If you look at it overall, average course costs in that time nearly tripled from $4,000 to $11,300. Loans increased by nearly 6,000 per cent, from $25 million to $1.5 billion.

I say to the young students up there from Narromine Christian School that whilst those opposite have an absolute predisposition to ensuring that all young people should go to university I'm going to take a different tack with you right here and right now, because I'm one who'll stand here and actually say that I don't think all students should go to university. I come from a trade background. I did my carpentry and joinery apprenticeship at Holmesglen College of TAFE and I'm proud of it. I worked as a builder for 10 years, and I'm proud of it. I then went back and did a law degree at uni, and some might say it has all been going downhill from there!

Mr Dreyfus: Why aren't you proud of that?

Mr WALLACE: Well, some might say it's all going downhill from there. But, I want to encourage the young people from Narromine Christian School and from all schools across the country. You don't have to go to university if you don't want to. If you want to go to university, great, knock your socks off, but you don't have to go to university. The Assistant Minister for Vocational Education and Skills is doing a fantastic job in trying to promote young people into trades. Whether you want to be a bricklayer or a carpenter or a plasterer or a butcher or a baker, there are plenty of other jobs, meaningful employment, available in Australia. To be quite honest with you, you might earn more money as a carpenter or a plasterer or a brickie than you would if you did a business degree. So, whatever you do, challenge your teachers, your vocational instructors and your guidance counsellors. Find out more about what it's like to be a tradesman or a tradeswoman, because that is an equally important path in our lives. If anybody tells you otherwise, you should challenge them on that.

Back to the bill: this bill is all about making university education in Australia the great system that it is and improving upon the great system that it is. It's more important than ever to protect the future of a system which currently supports 1.4 million students and has 16 Australian universities in the top 300 of world university rankings in 2017 and 2018.

As the member for Fisher, I have one of the newest universities in Australia in my electorate, and that is the University of the Sunshine Coast. It is a fantastic university that's only been going for a little less than 20 years, but in that 20 years it has seen its graduates list almost 20,000 in number. It is a university that I am very proud of because it engages with its local community.

This government is focused on encouraging quality and excellence in Australian higher education and ensuring that students have the support they need to succeed, while also making sure that the system is sustainable for future generations so students yet to come have the sorts of opportunities that this and other generations have had. The Higher Education Reform Package has been developed after substantial consultation and discussion with a broad range of stakeholders and focuses on three key themes: improving the sustainability of higher education, providing more choices for students and increasing transparency and accountability. This government will continue to support the best features of the current higher education system, underpinning a vibrant education export industry, supporting student career aspirations and ensuring that industry has a skilled workforce.

The reforms proposed by the government are fair. They drive quality and excellence and focus on ensuring that Australians who want to study have the right support and the right opportunities. A key challenge is how to make the system sustainable for future generations of students. Since 2009, taxpayer funding for teaching and learning has increased by 71 per cent, twice the growth rate of the economy as a whole. The current funding arrangements are not sustainable, and reform is needed if future generations like those up in the Narromine Christian School are to take advantage of higher education—a world-class higher education—into the future.

A key element of the higher education system is the Higher Education Loan Program, which supports universal, merit based access to higher education in Australia and is one of the most generous student loan schemes in the world. Those opposite would have you believe that the government is attacking that. We are not attacking that at all. We want to ensure that, no matter whether you come from a wealthy family or a non-wealthy family, if you have the ability, the skill, the interest, the talent and the desire to go to university, you have every opportunity, as much as anyone else.

However, the HELP repayments—that is, the Higher Education Loan Program repayments—have not kept pace with the HELP lending growth rate. Due to the income-contingent nature of HELP, debtors do not start making compulsory repayments until their income is above the minimum repayment threshold, currently in 2017-18, set at $55,874. Since 2009, the fair value of student loans has increased from $12.5 billion to $36.8 billion and is expected to increase further to $59.7 billion by 2019-20. The total outstanding student debt underwritten by taxpayers now stands at $50 billion, with a quarter of that not expected to be repaid.

The Commonwealth supported places which provide places for university students are subsidised by the Australian government so that students are only required to pay a student contribution amount for each unit that they're enrolled in. Universities and other higher education providers set their own student contribution amounts within limits set by the Australian government. It's necessary with increasing enrolments and budget pressures to increase the maximum contribution each student can be asked to make. These reforms will rebalance the contributions made by taxpayers and students to the cost of higher education. After the changes have been implemented, the taxpayer will remain the majority funder of higher education by 2021, providing on average 54 per cent of base funding for the costs of teaching and learning.

The Deloitte cost-of-delivery report undertaken in 2016 showed that universities spent 85 per cent of their total funds for bachelor level courses on teaching and learning in 2015, compared to the 2011 base funding review which found that 94 per cent of base funding for bachelor level courses was spent on teaching and learning. These findings suggest it is reasonable to expect some of these efficiencies should be shared with the government. Effectively, costs per student for teaching and learning have increased by 9.5 per cent since 2010, while revenue per student has risen by 15 per cent over that time. This efficiency dividend equates on average to 2.8 per cent of base funding for teaching and research. When last in government, Labor proposed its own efficiency dividend of 3.25 per cent, but you don't hear anything at all about that from the other side. Then Prime Minister Julia Gillard said on 16 April 2013:

… the number of places has grown, but funding has also gone up per student place.

Money to universities is still going to grow. We've got universities on a growth path.

What we are asking them to do is for one year to accept a two per cent efficiency dividend, and in the second year a 1.25 per cent efficiency dividend.

That means their money would still grow, it just wouldn't grow as fast as they'd obviously wanted …

Once again, you don't hear any of that from the other side. In opposition, Labor is playing politics. I'm sure that won't come as a surprise to anybody who's been around this place long enough. And they are using delaying tactics when they well know what we are proposing is fair, reasonable and necessary.

HELP is here to stay. The Australian government remains committed to a system of higher education that is affordable for individuals but it must be affordable for the country. Australia has one of the most generous student loan schemes in the world. The Higher Education Loans Program is one that will see young people go to university and pay no up-front fees. We will keep that loan system in place. There will be no up-front student fees. The system of student loans will be protected. Students will only have to pay their loans back when they are earning a high enough income. No eligible domestic student has to pay up-front fees, because they are able to borrow from the government to meet their share of the cost of study. No real rate of interest is charged on their loan. The government effectively absorbs this cost.

Australia's HELP scheme, which provides assistance for young people and old people to get into university to improve their education, is the envy of the world. It means that anyone who has the ability and motivation to participate in higher education is not prevented from doing so because of the need to pay their tuition fees up-front. We will improve the sustainability of the HELP scheme by introducing new HELP repayment thresholds and rates for all current and future HELP debtors from 1 July 2018. The proposal to index HELP repayment thresholds at CPI will maintain the value of thresholds in real terms, as the thresholds will increase in line with the cost of living, rather than wages. With average weekly earnings typically being higher than CPI, indexation by CPI will slow the growth of repayment thresholds and ensure they remain appropriate when compared to an individual's capacity to repay.

I'll finish off by saying that this government is absolutely 100 per cent committed to providing an effective, world-class higher education university scheme for all Australians, no matter what their socioeconomic background is. (Time expired)