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Wednesday, 13 August 2003
Page: 18358

Dr NELSON (Minister for Education, Science and Training) (11:33 AM) —I thank all honourable members for their contributions to this debate on the Higher Education Legislation Amendment Bill 2003. Of course I do not agree with all of the comments that were made, but I do appreciate them. It is terrific that we are now having a debate in Australia about education and university education in particular. There are some particular remarks to which I would like to draw the House's attention. Last year the government conducted the first major review of higher education policy in many years. The product of this debate was released in the budget under the government's higher education reform package, Our Universities: Backing Australia's Future, with $1.5 billion in additional public investment in the first four years and $10.6 billion over the first decade. The Higher Education Legislation Amendment Bill 2003 consolidates the government's ongoing commitment to Australia's higher education system and, in particular, to world-class research. It builds on the achievements of this government to date in developing a sustainable quality higher education sector, as evidenced by record levels of funding, strong growth and increased participation.

The bill provides $7.3 million in 2003 to assist the Australian National University to rebuild its world-class research facilities at Mount Stromlo Observatory following the Canberra bushfires in January 2003. The research school has long been recognised as an important player in national and international astronomy, providing leading edge training for students and world-class pure and applied facilities. I have told Australia's astronomers, as I have told the Vice-Chancellor of the Australian National University, that I will be taking an ongoing personal interest in the costs of the rebuilding, and the government will ensure that the facility will be rebuilt as it was.

Funding amounts in the Higher Education Funding Act 1988 are also updated in the bill to reflect the indexation of grants for 2003 and the latest estimates of HECS liability. One of the largest single initiatives of Backing Australia's Ability—which is the $3 billion, five-year commitment by the Commonwealth to research, innovation and commercialisation—is an additional $740 million for research funded through the Australian Research Council. Over a period of five years this will double the Australian Research Council's capacity to fund research through the National Competitive Grants Program. The bill appropriates $275 million of the additional funding to be provided in 2006-07.

The bill also amends the Australian Research Council Act 2001 in order to streamline the administration and financial management of the Australian Research Council, its advisory structures and research programs. It will update the composition of the Australian Research Council board, streng-then disclosure of interest requirements, provide for the appropriation of funds by financial year, update funding amounts to reflect indexation and insert a new funding cap for the out year of the budget estimates.

The member for Jagajaga has moved a second reading amendment. Naturally, I do not agree with the points that are made in the amendment about government policies on higher education. The Howard government is committed to funding an accessible, high-quality system of public universities in Australia. The opposition should take heed of pleas from university leadership to pass the government's reforms that will soon be before the parliament. As outlined in her second reading amendment, the member for Jagajaga has flagged an amendment in the Senate on the minister's determination to specify for the ARC the funding split between research programs. We await the detail of the amendment, but in the interim I should explain the proposed provision and its importance.

The bill provides increased flexibility in determining research program funding splits to facilitate more efficient administration. The current legislation requires the minister to determine the funding cap and split between the categories of research programs—currently the linkage and discovery programs. In practice this means that each time there is a change to an approved proposal—for example, when a grant is handed back because a researcher ceases a project and funds then become available—the split can be affected, thereby triggering a process which requires the minister to approve a new split. The bill allows the minister to delegate funding split variations in those instances. The purpose of this change is to provide the ARC with greater administrative efficiencies by ensuring that proposals for minor funding variations are able to be approved by the minister's delegate. Under the current legislation there is no specified range within which the minister can vary program finding splits. Similarly, this bill does not propose adding a range. However, funding split variations made by the minister to date have been minor—usually less than five per cent. As always, the minister will be accountable to the parliament for the effective, efficient and responsible administration of the legislation.

During the second reading debate members made a lot of contributions. There was a particular focus, especially from members on the opposition benches, on some of the changes in the government's proposed higher education reforms, which I would like to address in this summing up. About three-quarters of the Labor Party's higher education policy replicates that of the government's higher education reforms—for which it ought to be given credit, I might add. But the Labor Party has diverted from the government's reforms on the things that are necessary but difficult. It is very important that universities, whose budgets range from $50 million to $880 million, are governed and administered in ways which are appropriate to modern institutions and organisations. It is important that there be governance reform in universities and that people who come to university councils bring to them skills and experience as trustees, to do the very best they can for the university rather than simply being delegates for someone else. Whilst I have a very high regard for MPs, whatever our political parties, I think it is important that we do not have serving members of parliament on university governing councils.

It is equally important that the changes in productivity, which have been driven in part by workplace relations reform in almost every other sector of Australian working life, continue to be applied. There has been a lot of reform in university work practices, but we continue to drive work practices in the higher education sector. Professor Gerard Sutton, Vice-Chancellor of the University of Wollongong, observed that every vice-chancellor `has a professor who is worth twice what we pay him or her and one who is worth half'. One of the things we found in the Productivity Commission review of universities, comparing them with North America and Europe, was the very narrow range of salaries which academics in Australia attract.

It is also important that we move to a funding system in universities which actually funds them for what they do. We currently have what is called a relative funding model, which was established in 1990. The government are now proposing to fund universities on a discipline mix—to fund them on the basis of the courses they provide. In that process, we have found that some universities have been quite desperately underfunded. Curtin University of Technology, for example, in the first three years alone will attract an extra $54 million from Commonwealth grant money. The University of Tasmania will attract $17 million extra in the first three years.

One thing was argued by all of the vice-chancellors. Professor Kerry Cox at the University of Ballarat, Professor Di Yerbury at Macquarie University, Professor Lance Twomey at Curtin University of Technology and Professor Gavin Brown at the University of Sydney all agreed on what was necessary in order to deliver a 20/20 vision for higher education and in order for Australian higher education to quite reasonably compete with the rest of the world—because, increasingly, the only benchmarks that are going to count are international ones. We are very proud of where any institution, individual, sporting person or musician ranks within Australia. But, if you take a 10- to 20-year view of it, what will be increasingly much more important is where we rank in the rest of the world. The University of Queensland is an outstanding university. It is competing increasingly not so much with the University of Sydney or QUT but with the rest of the world, yet we fund and administer all Australian universities in exactly the same way—and, I might add, from 22 different programs in my department alone. All the vice-chancellors said that if you want to build a world-class higher education sector it is important that the universities themselves set the HECS charge. That is the contribution that students subsequently pay back when they have graduated and are earning an income which, under our proposals, is in excess of $30,000 a year. All the vice-chancellors said that it was very important that the universities themselves have the flexibility to set that charge. It would be supported by the current HECS loan. We have 14 years experience with HECS.

That is very important, not because some universities will get extra money for teaching and supporting students by increasing HECS charges in some courses but because it goes to the heart of quality and differentiation. The University of Western Sydney, as well as a number of other universities, said that it would not be increasing HECS charges to its students. The University of Sydney, on the other hand, has already passed a resolution which says that it would increase its charges by 30 per cent. This creates an environment where, for the first time in this country, students will have choices and will think about the cost of attending a certain institution, the cost to them of repaying their HECS once they have graduated and the quality of what they are actually getting. The Vice-Chancellor of the University of Tasmania told me again on Sunday that that university will not be increasing any of its HECS charges. Currently, 2,000 Tasmanians are studying in Victorian universities. We may well see very good students who look at the quality of what is being received. Systematic student evaluation and the publication of that evaluation in part will be one of the criteria which will be used so that prospective students have meaningful information upon which to judge the quality of what they are about to receive. That kind of tension will be introduced for the first time.

At the moment, the most mediocre course in the least regarded university in the country charges exactly the same to a student as that in the most competitive, highly regarded, highly valued course in the most highly valued university in Australia. I might add that, the same as we have in the school system, people choose to go to universities for the wrong reasons. If someone had asked me two years ago if I were to go back university which university would I attend, it would be a different one from the one I would choose now, now that I am much more familiar with the system and the standards of Australian higher education.

The other thing that is very important is that the Labor Party has said that in its policy, should it win government, it would abolish full fee paying places for Australian students. The argument which we have heard throughout this debate is that access to a university education should only be on the basis of merit. We ought to be a bit careful about this particular argument. I think that all of us, every single one of us, believe that access to higher education should be merit based. The HECS funded places—the ones that the taxpayers fully fund three-quarters of the cost, and the students fund a quarter and then pay it back through the tax system—are by and large allocated on merit. The student who gets the highest tertiary entrance score gets the first place and so it goes down. The students who are full fee paying—Australian students, of which there are 9,400 in the system at the moment—are offered places and by definition have lower entry scores than the last student who attracts a HECS place or gets a HECS place. Those students are described by some people as thick or dumb.

I would like to point out to the House an article in the Melbourne Age two weeks ago—last Saturday fortnight, I think. It profiled a young man who went to a middle level Catholic school in Victoria. He achiev-ed an entry score of 98.75. He wanted to do law-arts at Monash University. When he opened his results, he was quoted as saying, `You beauty, I am in.' The cut-off score for law at Monash University was 99.1. Under the Labor plan, he would have no choice. He is currently doing law at Monash University. His parents work respectively at a local council and in the library. The three of them start at six o'clock at night and spend three hours cleaning buses to pay the fees for his university education. Under the Labor plan, he would have no choice. However, if he had been a citizen in Hong Kong, Jakarta or Beijing he would be welcomed as a full fee paying student at Monash University. Under the Labor plan, he would be forced to take up a HECS place in a course that he does not want because he would have no choice.

The inequity of the current arrangement is that if you do come from a high-income family, it is much easier to take up a fee paying place because parents either have the money or they borrow the money. But if you come from a low-income family and you get a very high tertiary entrance score but miss out on a HECS place, you might as well be offered a ticket to Mars. I have spoken to parents who have kids who have taken up full fee paying places who have taken out second mortgages on houses. The parents have four jobs between them. They come from low-income families. If they come from my electorate on the upper North Shore of Sydney and they are offered a full fee paying place in most cases, although not in all, they can take that up. Mr Deputy Speaker Price, if they come from your electorate, I think you know it would be far more difficult for them. The solution to the problem is twofold. The first is to do what the government is doing and say, `We will lend you the money. We will lend it under the same arrangements as HECS, except we will add a 3½ per cent real interest rate to the loan, so at least you can get the financial assistance if you want to take up the place.'

In regard to this argument about merit and HECS places, I want to point out to the parliament that in South Australia, for example, seven per cent of students who got a university place in South Australian universities this year did not get there purely on academic merit. Their tertiary entrance scores were elevated by virtue of where they live, the schools that they attended and the socio-economic backgrounds from which they come. Do you know what? I strongly support that. The same is replicated in New South Wales and in other states. In other words, something like one in 15 students who got a place in universities this year are not there with a public subsidy three-quarters paid by the taxpayer purely on academic merit. I defend that because I think that a student who was educated in very difficult circumstances deserves assistance to get a place—a publicly funded place. Please do not then turn around and say to students who are very gifted, by any standard, that they can only go to university if they receive a public subsidy to do so. If they are prepared to pay for it themselves, then allow them to do it.

What about the 30,000 to 40,000 students who are in the 84 private higher education institutions in Australia—for example, the Australian Institute of Music in Sydney? Mr Deputy Speaker, you ought to talk to the director because you will find that there are students from your electorate who get access to this outstanding musical institution, who get no public subsidy and who go away—as he said to me—and they do not hear from them for two years. Then they come back and they say, `I have saved up the money.' Under these proposals, they will be able to take up the place, whether it is at Tabor College, Notre Dame, Bond University, the Melbourne College of Divinity or the Christian Heritage College. They will be able to take it up because there will be assistance available to them.

Dr Emerson —Mr Deputy Speaker, I rise on a point of order. I note that the minister's time has just about expired and a number of members from this side of the parliament want to ask specific questions. We are not going into consideration in detail, but I would ask that the minister answer questions such as those raised by the member for Ballarat before finishing his tirade.

The DEPUTY SPEAKER (Hon. L.R.S. Price)—The honourable member for Rankin will resume his seat and not make frivolous points of order.

Dr NELSON —With these issues there is a kind of reverse elitism, no matter who is in government and no matter how many publicly funded places there are. The demand in veterinary science and medicine and law and dentistry and arts-law will always be higher and we should not live in a country in which we say that we will have greater opportunities made available for people who have the freedom to take up a full fee paying place be-cause they have a passport from another country rather than one for this. Every Australian deserves a fair go, and the reverse elitism that says you should only go to university to get a public subsidy needs to end, particularly if we want not only equity but, indeed, internationally competitive institutions.

The DEPUTY SPEAKER —The original question was that this bill be now read a second time. To this the honourable Deputy Leader of the Opposition has moved as an amendment that all words after `That' be omitted with a view to substituting other words. The immediate question is that the words proposed to be omitted stand part of the question.

Question agreed to.

Original question agreed to.

Bill read a second time.

Message from the Administrator recommending appropriation announced.