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Wednesday, 1 June 1994
Page: 1040


Senator BELL (11.26 a.m.) —As Senator Teague has already indicated, the Employment, Education and Training Legislation Amendment Bill makes minor amendments to education and training legislation. The Australian Democrats will not be opposing those changes: in fact, we welcome them.

  I take this opportunity to comment on the changes to higher education policy as a consequence of this year's budget. The Democrats are pleased to see that this bill allows for funding adjustments to the Higher Education Funding Legislation Amendment Bill 1993 as a consequence of the rejection of double HECS for second degrees by the Senate last year. As Senator Teague has mentioned, that was a little moment of high success for the Senate, because we were doing what I think the Senate was intended to do, review legislation and protect certain aspects of the Australian community.

  As we saw it, and I think rightly so, the government was attempting to introduce a regressive fee payment. It was not the only regressive fee payment that the government attempted to introduce last year. It also tried to implement a minimum time in which students had to complete their degrees or else face a 50 per cent increase in their HECS debt for each additional unit that they undertook.

  As Senator Teague has invoked the Australian Vice-chancellors Committee already in his speech, I remind the Senate that it was that body that pointed out the educational fallacy of such a move. Again, I am pleased that the Senate was able to recognise also how wrong such a move was and to reject it.

  The minimum time rule was excised from the relevant legislation and the double HECS proposal was stopped by the Senate after strong lobbying and protests—and I must proudly say that that was led by the Democrats—by student and other organisations and, eventually, the opposition, after some internal policy processing and some individual efforts. The Democrats take pride in this result. We were pleased when the opposition did come on side and oppose what was a cynical revenue raising move. Unfortunately, I think we can demonstrate that the Democrats remain the only supporters of an accessible and equitable education system for all Australians regardless of their background, their socio-economic status or their sex.

  This year's budget has been described by some in the education sector as a mogadon budget. Senator Cheryl Kernot has stated that it is one of the most boring budgets that we have seen. But there are some discrete budget changes that will impact harshly on students. We should be aware of those changes and note them. They include the decision to calculate HECS repayments on a pro rate basis and an increase to the amount that students can take out in the form of a loan. Those changes in this budget mean that from 1995 all new graduates will have to pay HECS on a pro rata basis.

  `Pro rata basis' is a pretty easy thing to say. It almost sounds fair until one examines how it will actually work and what it will mean for individual students. Now, after this budget, graduates are liable to repay their HECS deferred payments even if they have only worked for part of the year. According to the government, students will be required to repay their HECS debt in accordance with the proportion of the year that they spend in the work force.

  The Australian Democrats, education groups and individuals are particularly concerned for those students who work on a part-time basis or on a casual basis. It is easy to see why. Take the example of somebody who gains part-time work for a couple of weeks at a rate which is in excess of the $26,000-odd threshold. It is quite likely that somebody studying for an engineering degree will be fortunate enough—and there are many who are not—to gain part-time work either as a work experience component required by the engineering faculty or on a particular project at a rate in excess of the $26,000 threshold. The total amount received for a few weeks may well be just a couple of thousand dollars, and it may be the only work that is obtained during the whole year, yet out of that couple of thousand dollars will be taken the HECS repayment.

  The previous scheme was fairer when the total annual earnings of the student were taken into account and if those earnings were below that threshold, the HECS repayment was not required at that time. That was the original intention, and it seemed much fairer. But now, even if a student is able to obtain employment earning only a measly few hundred or couple of thousand dollars, that HECS repayment will be taken out on this pro rata basis.

  Due to these pro rata arrangements and along with changes to the Higher Education Funding Act 1988 which allow the inclusion of HECS assessment debts in the PAYE arrangements, the government expects to recoup almost $12 million in 1994-95, $3 million in 1995-96 and $2 million in 1996-97. The Democrats find it interesting that the coalition has taken offence to these amendments, despite its earlier support for the changes contained in the Higher Education Funding Act in relation to the PAYE scheme. I think that is an inconsistency, if not an hypocrisy. We will be dealing with that later. I think the important thing is that, all in all, students are now repaying their HECS debts at a faster rate, and sooner. All that means is that these students are all the poorer for that.

  As I mentioned in my speech on the Student Assistance Amendment Bill in this chamber only three weeks ago, the threshold levels for the repayment of HECS and now for student loans have been lowered. No longer is the CPI factored into the threshold for average weekly earnings. Again that is an unjust move which does not apply to other measures. When we are talking fairness, the CPI is one of those basic fairnesses that should be included in all projections for either repayments or the receipt of benefits. Any movements in the CPI should be contained as a basic premise on which such calculations are built. It is not here, and that illustrates the unfairness with which students are treated by this government.

  The HECS and student loan repayments are now concentrated at an earlier age for nearly all graduates. The National Union of Students, the peak representative body for students in Australia, claims:

As repayments become larger and more rapid they will ultimately deter potential students from entering education.

That is a worrying trend in higher education; one that points to a government that is committed to reducing education quality and funding. That is what it is doing, and it is evident by its actions.

  The decision to increase the amount that students can take out in student loans from $6,000 to $7,000 per year signals the government's increasing reliance on user pays education and student assistance, and that is at the expense of a realistic and increased commitment to student assistance. When the loans scheme was being hotly debated in 1992, when student groups claimed that it was the thin end of the wedge and that the amount available for loans would increase over the years, they were howled down by the government. The government claimed that this was a fallacious argument. I think the students' accuracy has been proven by what we see before us now. It cannot be denied; it is there in black and white.

  According to research by the National Union of Students, graduates who take up the student loan option will, upon graduation, have a debt of at least $21,000 which does not even begin to take into account the HECS debt. Most students will be given a graduation present of around $30,000 worth of debt. We have already demonstrated that that will impact mostly on women who are unable to gain employment at a rate which is sufficient to be able to repay that, and other socioeconomically disadvantaged students who may carry that debt for the rest of their lives. And what does this government do? It simply reduces the threshold at which repayment is mandatory and it increases the rate at which repayment is required. How can this government claim that it is not condemning Australian students to debt? I do not know.

  The government had the opportunity to do something about this situation in this budget, but it ignored even the recommendations from its own commissioned research by the Boston consultancy groups and the recent Senate standing committee report into research in higher education which suggested that there is a desperate need for a research infrastructure funding injection of at least $125 million for a year, and we saw nothing of that in this budget.

  The other changes contained in this bill transfer the responsibility of funding for the Australian National University to the Higher Education Funding Act 1988 and consequently deduct the necessary amount from the ACT government. As has already been mentioned, that is a more efficient way of doing it. Other changes also amend the Maritime College Act 1978 to allow for the appointment of the chairperson of the academic board and to include changes to gender specific terms—welcome changes, but minor. Three acts are repealed as a consequence of this legislation as they have been superseded by other laws, and of course we have no disagreement with that.

  I commend this bill to the Senate but I have stated for the record the reservations the Australian Democrats have with regard to the continuing downgrading of Australia's education system.