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Wednesday, 2 December 2015
Page: 9590


Senator KIM CARR (Victoria) (11:38): I move opposition amendment (2) on sheet 7828:

(2) Page 31 (after line 26), at the end of the Bill, add:

Schedule 3—VET FEE -HELP loan limit

Higher Education Support Act 2003

1 Subdivision 104 -B (heading)

   Repeal the heading, substitute:

Subdivision 104 -B -FEE -HELP and VET FEE -HELP balances

2 Sections 104 -15 and 104 -20

   Repeal the sections, substitute:

104 -15 A person's FEE -HELP balance or VET FEE -HELP balance

   FEE -HELP balance

(1) A person's FEE -HELP balance at a particular time is:

   (a) if the *FEE -HELP limit in relation to the person at the time exceeds the sum of all of the amounts of *FEE -HELP assistance that have previously been payable to the person, being that sum as reduced by any amounts previously re -credited under this Subdivision—that excess; and

   (b) otherwise—zero.

Note: If an amount is to be re -credited to a FEE -HELP balance, the balance that is to be re -credited is worked out immediately before that re -crediting. The balance is worked out after the re -crediting by taking account of the amount re -credited. If a person's FEE -HELP limit has been reduced, the balance might not increase, or might not increase by the same amount as the amount re -credited.

(2) To avoid doubt, the sum referred to in paragraph (1)(a) includes amounts of *FEE -HELP assistance that have been repaid.

   VET FEE -HELP balance

(3) A person's VET FEE -HELP balance at a particular time is:

   (a) if the *FEE -HELP limit in relation to the person at the time exceeds the sum of all of the amounts of *VET FEE -HELP assistance that have previously been payable to the person, being that sum as reduced by any amounts previously re -credited under Subdivision 7 -B of Schedule 1A—that excess; and

   (b) otherwise—zero.

Note: If an amount is to be re -credited to a VET FEE -HELP balance, the balance that is to be re -credited is worked out immediately before that re -crediting. The balance is worked out after the re -crediting by taking account of the amount re -credited. If a person's FEE -HELP limit has been reduced, the balance might not increase, or might not increase by the same amount as the amount re -credited.

(4) To avoid doubt, the sum referred to in paragraph (3)(a) includes amounts of *FEE -HELP assistance that have been repaid.

104 -20 The FEE -HELP and VET FEE -HELP limits

(1) The FEE -HELP limit is:

   (a) $97,728;

   (b) in relation to a person who is enrolled in a *course of study in medicine, a *course of study in dentistry or a *course of study in veterinary science, while the person is enrolled in that course—$122,162.

Note 1: A person is entitled to receive both FEE -HELP assistance and VET FEE -HELP assistance up to the relevant FEE -HELP limit.

Note 2: The FEE -HELP limit is indexed under Part 5 -6.

(2) The VET FEE -HELP limit is $48,864.

Note 1: A person is entitled to receive both FEE -HELP assistance and VET FEE -HELP assistance up to the relevant FEE -HELP limit.

Note 2: The VET FEE -HELP limit is indexed under Part 5 -6.

3 Section 107 -10

   Repeal the section, substitute:

107 -10 Amounts of FEE -HELP assistance must not exceed the FEE -HELP balance

Amount of FEE -HELP assistance for one unit

(1) The amount of *FEE -HELP assistance to which a student is entitled for a unit of study is an amount equal to the student's *FEE -HELP balance on the *census date for the unit if:

   (a) there is no other unit of study, with the same census date, for which the student is entitled to FEE -HELP assistance; or

   (b) the amount of FEE -HELP assistance to which the student would be entitled under section 107 -1 for the unit would exceed that FEE -HELP balance.

Amount of FEE -HELP assistance for more than one unit

(2) If the sum of:

   (a) the amount of *FEE -HELP assistance to which a student would be entitled under section 107 -1 for a unit of study; and

   (b) any other amounts of FEE -HELP assistance to which the student would be entitled under that section for other units that have the same *census date as that unit; and

would exceed the student's *FEE -HELP balance on the census date for the unit, then, despite subsection (1) of this section, the total amount of FEE -HELP assistance to which the student is entitled for all of those units is an amount equal to that FEE -HELP balance.

Example:    Example: Kath has a FEE -HELP balance of $2,000, and is enrolled in 4 units with the same census date. Kath's tuition fee for each unit is $600. The total amount of FEE -HELP assistance to which Kath is entitled for the units is $2,000, even though the total amount of her tuition fees for the units is $2,400.

(3) If the student has enrolled in the units with more than one higher education provider and access to none of the units was provided by *Open Universities Australia, the student must notify each provider of the proportion of the total amount of *FEE -HELP assistance that is to be payable in relation to the units in which the student has enrolled with that provider.

(4) If access to some, but not all, of the units of study was provided by *Open Universities Australia, the student must:

   (a) notify Open Universities Australia of the proportion of the total amount of *FEE -HELP assistance that is to be payable in relation to units access to which was provided by Open Universities Australia; and

   (b) notify each higher education provider at which the student is enrolled in a unit, access to which was not provided by Open Universities Australia, of the proportion of the total amount of FEE -HELP assistance that is to be payable in relation to that unit.

4 Subsection 137 -18(4)

   Repeal the subsection, substitute:

Remission of VET FEE -HELP debts

(4) A person's *VET FEE -HELP debt in relation to a *VET unit of study is taken to be remit ted if the person's *FEE -HELP balance is re -credited under clause 46, 47 or 51 of Schedule 1A in relation to the unit.

Note: The debt is taken to be remit ted even if the person's VET FEE -HELP balance is not increased by an amount equal to the amount re -credited.

5 Subsection 198 -5 (table item 4)

Repeal the table item, substitute:

4

The *FEE -HELP limit

Subsection 104 -20(1)

4A

The *VET FEE -HELP limit

Subsection 104 -20(2)

6 Paragraph 43(1)(b) of Schedule 1A

   Omit "*FEE -HELP balance", substitute "*VET FEE -HELP balance".

7 Subdivision 7 -B of Schedule 1A (heading)

   Repel the heading, substitute:

Subdivision 7 -B—VET FEE -HELP balances

8 Clause 46 of Schedule 1A (heading)

   Repeal the heading, substitute:

46 Main case of re -crediting a person's VET FEE -HELP balance

9 Subclause 46(1) of Schedule 1A

   Omit "*FEE -HELP balance", substitute "*VET FEE -HELP balance".

10 Subclause 46(1) of Schedule 1A (note)

   Repeal the note, substitute:

Note: For VET FEE -HELP balance , see section 104 -15, and for VET FEE -HELP limit , see section 104 -20.

11 Subclause 46(2) of Schedule 1A

   Omit "*FEE -HELP balance", substitute "*VET FEE -HELP balance".

12 Paragraph 46(2)(d) of Schedule 1A

   Omit "FEE -HELP balance", substitute "VET FEE -HELP balance".

13 Subclause 46(2) of Schedule 1A (note)

   Omit "FEE -HELP balance", substitute "VET FEE -HELP balance".

14 Clause 47 of Schedule 1A (heading)

   Repeal the heading, substitute:

47 Re -crediting a person's VET FEE -HELP balance—no tax file number

15 Subclause 47(1) of Schedule 1A

   Omit "*FEE -HELP balance", substitute "*VET FEE -HELP balance".

16 Subclause 47(1) of Schedule 1A (note)

   Omit "FEE -HELP balance", substitute "VET FEE -HELP balance".

17 Subclause 47(2) of Schedule 1A

   Omit "*FEE -HELP balance", substitute "*VET FEE -HELP balance".

18 Paragraph 49(1)(a) of Schedule 1A

   Omit "*FEE -HELP balance", substitute "*VET FEE -HELP balance".

19 Clause 51 of Schedule 1A (heading)

   Repeal the heading, substitute:

51 Re -crediting a person's VET FEE -HELP balance if provider ceases to provide course of which unit forms part

20 Subclause 51(1) of Schedule 1A

   Omit "*FEE -HELP balance", substitute "*VET FEE -HELP balance".

21 Subclause 51(1) of Schedule 1A (note)

   Omit "FEE -HELP balance", substitute "VET FEE -HELP balance".

22 Subclause 51(2) of Schedule 1A

   Omit "*FEE -HELP balance", substitute "*VET FEE -HELP balance".

23 Clause 54 of Schedule 1A

   Repeal the clause, substitute:

54 Amounts of VET FEE -HELP assistance must not exceed the VET FEE -HELP balance

Amount of VET FEE -HELP assistance for one unit

(1) The amount of *VET FEE -HELP assistance to which a student is entitled for a *VET unit of study is an amount equal to the student's *VET FEE -HELP balance on the *census date for the unit if:

   (a) there is no other VET unit of study, with the same census date, for which the student is entitled to VET FEE -HELP assistance; and

   (b) the amount of VET FEE -HELP assistance to which the student would be entitled under clause 52 for the unit would exceed that VET FEE -HELP balance.

Amount of VET FEE -HELP assistance for more than one unit

(2) If the sum of:

   (a) the amount of *VET FEE -HELP assistance to which a student would be entitled under clause 52 for a *VET unit of study; and

   (b) any other amounts of VET FEE -HELP assistance to which the student would be entitled under that clause for other units that have the same *census date as that unit;

would exceed the student's *VET FEE -HELP balance on the census date for the unit, hen, despite subclause (1) of this clause, the total amount of VET FEE -HELP assistance to which the student is entitled for all of those units is an amount equal to that VET FEE -HELP balance.

Note: Example: Kath has a VET FEE -HELP balance of $2,000, and is enrolled in 4 units with the same census date. Kath's VET tuition fee for each unit is $600. The total amount of VET FEE -HELP assistance to which Kath is entitled for the units is $2,000, even though the total amount of her VET tuition fees for the units is $2,400.

(3) If the student has enrolled in the units with more than one *VET provider, the student must notify each provider of the proportion of the total amount of *VET FEE -HELP assistance that is to be payable in relation to the units in which the student has enrolled with that provider.

24 Clause 56 of Schedule 1A (heading)

   Repeal the heading, substitute:

56 Effect of VET FEE -HELP balance being re -credited

25 Subclause 56(1) of Schedule 1A

   Omit "*FEE -HELP balance", substitute "*VET FEE -HELP balance".

26 Subclause 56(1) of Schedule 1A (note)

   Omit "FEE -HELP balance", substitute "VET FEE -HELP balance".

27 Paragraph 56(2)(a) of Schedule 1A

   Repeal the paragraph, substitute:

   (a) the person's *VET FEE -HELP balance was re -credited under subclause 46(2) (main case of re -crediting a person's VET FEE -HELP balance); and

28 Subclause 56(3) of Schedule 1A

   Omit "*FEE -HELP balance", substitute "*VET FEE -HELP balance".

29 Subclause 89(1) of Schedule 1A (note)

   Omit "FEE -HELP balance", substitute "VET FEE -HELP balance".

30 Clause 92 of Schedule 1A (table item 1)

   Omit "*FEE -HELP balance", substitute "VET FEE -HELP balance".

31 Subclause 1(1) of Schedule 1 (definition of FEE -HELP balance )

   Omit "section 104 -15", substitute "subsection 104 -15(1)".

32 Subclause 1(1) of Schedule 1 (definition of FEE -HELP limit )

   Omit "section 104 -20", substitute "subsection 104 -20(1)".

33 Subclause 1(1) of Schedule 1

   Insert:

   VET FEE -HELP balance has the meaning given by subsection 104 -15(3).

   VET FEE -HELP limit has the meaning given by subsection 104 -20(2).

This is the substantive opposition amendment and this is the only position I am pursuing in regard to the amendments the opposition had foreshadowed because of the subsequent and late series of amendments that the government has put in, which I have described as somewhat panicked and desperate and rushed. All of those things reflect the current situation, which, of course, was presented to us at the very last minute for this bill. They are clearly an admission of what the Labor Party have been saying for some time: the original bill was inadequate. The government has now made crystal clear the point that its own proposals were grossly inadequate, and I have some sympathy for Senator McKenzie's role in this matter as the government chair of the Education and Employment Legislation Committee. The committee's report, presented to the Senate just on Monday night, told us:

The committee therefore commends the bill as a vital reform that will improve the integrity of the VET FEE-HELP scheme and restore confidence in the VET sector.

The report also said:

The committee recommends that the Senate pass the bill.

It is clear that the government did not accept that advice, despite the fact that, if normal custom and practice is followed in this place, the government had actually written the report that the government senators had relied upon. It is a pity they did not tell the government senators they were about to abandon them, because that is what the consequences of these provisions are. On the one hand, the government senators are told to give the scheme a clean bill of health with this particular bill, and then, as my colleague in the other place, the member for Cunningham, said, she was summoned to a meeting with the Minister for Vocational Education and Skills. That meeting took place yesterday at 12.15 pm, and I was on my feet at 12.30 pm.

With that in mind, these complicated amendments which we have just carried—13 pages of amendments and 18 pages or so of secondary amendments—have been described in this morning's papers as 'desperate', 'emergency measures' and 'urgent'. One report said it was 'a dog's breakfast'. If you look at what is actually going on here, with these are measures they are, in effect, freezing in place the status quo to allow the government time to develop a whole new scheme, allegedly within one year. As I have indicated before, I think the real issue here is to get past an election.

The Minister for Vocational Education and Skills has announced that the new scheme will be in place by 2017. There are no details and no principles. We have probably heard a little bit more today than we have heard at any other time, and I am sure many senators would be familiar with these matters because we saw the government's attempts to deregulate the university sector end in disaster. It strikes me that you have got to have a real leap of faith to think that in a year's time we are going to end up with a fully formed scheme to replace the existing scheme within the vocational education system. So I am a little sceptical, to say the least, and a little cynical about what the government's intentions are here, particularly given that we are running into an election, which, of course, will take a very substantial period of time in any process of policy development out of the political year.

Labor are proposing one simple proposition here, and the intent of the amendment is simple: it gives the minister an additional tool to control the rorts in the VET sector. It allows the minister, through a delegated responsibility to the secretary of the department, to control prices, as we do within the universities. The minister could seek to fix the costs of all courses or only some courses. That discretion would be available, and of course he would be politically accountable for that. But in no way could we afford the proposition that there needs to be price controls imposed on the VET sector, because what has happened has been an explosion in the costs of VET certificates. We know that because of what is published on TAFE courses, where there used to be fees scheduled, and we now see that the private colleges are charging three, four or five times what a TAFE college had and in many cases still do.

Professor Bruce Chapman, who I know is cited regularly in the press as the great architect of HECS, has called for the controls of tuition fees. He said:

You've got to cap prices otherwise people can really rort the system.

Peter Noonan, who is a well-known advocate probably more on the deregulation side of business, from the Mitchell Institute at Victoria University said:

To protect the system from itself, the government has to move in quickly and regulate prices.

The government will no doubt argue that there are technical problems with this approach and that it will take too long to get up and running. I say to you that that is just not right. We have already determined that the government is seeking to establish a new scheme within a year. This proposal that I have put before the chamber can be done very, very quickly. The original bill sought to bed down changes to cooling-off periods, to make providers aware of new prerequisites and to introduce new requirements for parents of those under 18 to sign loan forms. The department will need to put all those things in place within three weeks. It will need to introduce new systems for students to claim refunds, minimum registration periods and the change to VET guidelines for new penalties. So it goes a bit further than what the minister had indicated in a conversation we had had earlier on this matter as to what is actually required—

Senator Birmingham: I was just pointing to the amendments.

Senator KIM CARR: in this bill. The new amendments require a number of new administrative activities in determining the loan balance for each provider. The minister has explained they will do that on the basis of averaging eight months' activity applied over the whole year. That is essentially the principle. They will have to determine what is and is not a qualified VET course. They will have to establish a system of payment to providers for payments in arrears and establish a process to suspend payments to providers who have a record of poor performance, although I believe we will have some real issues about determining that record, particularly given the history in the last two years.

I am told that the new amendment allowed us to carve out providers for courses of particular industries, and we have seen that carried today. I am sure the chamber will excuse me when I treat, with some scepticism, the department's claims, which are reflected in the government's advice to us last night, that this would be too difficult, given all these other things. I have sought advice, overnight, from experts as well, and I am reminded that TAFE prices are already published. Private provider courses are supposed to be published. We had experience of one particular college that said it was a model. It appeared before the Senate inquiry, and we asked the question: where are your prices, and, of course, they could not be found. We now discover that the ACCC is still looking for a whole lot of other things that this 'model provider' claimed it had provided.

It is not hard to establish how it could be put in place, given the current regulations to require the publication of prices, and for TAFE that already occurs. There is a second way that this can be done. Our university students are currently charged according to three broad bands of subjects that they study. At university, in this country, the maximum amount that university students are required to pay is $10,440 per year for law, for commerce, for dentistry, for medicine and for veterinary science. It is $8,900 for engineering, science, allied health, agriculture and mathematics. It is $6,256 for education, nursing and humanities. It is not hard. Those models are in place now and have been for some considerable time.

There is another little problem with this question about, 'It's too hard for us to work out what prices to charge.' In New South Wales, the Independent Pricing and Regulatory Tribunal currently reviews all VET courses in that state, and their findings are published for every course in the state. In Victoria, TAFEs charge between $5,000 and $7,000 for low-cost courses such as business or IT. There are fee-for-service courses processes. At Holmesglen, one of the more expensive courses, nursing, is at $20,000; early childhood is $10,000; and disability is $9,000. So it strikes me that it is not hard to identify what the prices actually are. But more than that, where else within the Commonwealth do we allow people to charge whatever they like and the Commonwealth picks up the bill? Where does that occur?

There is, of course, a situation now where we are having online business diplomas with minimum operating cost and people being charged up to $20,000 for them. They are actually more expensive under the VET system now than the price people are charged to do medicine. This is particularly the case when you end up with double-diploma enrolments and the like. That is if people actually know they are enrolled. We have at the moment a cost structure which is way over the odds and has increased to extraordinary levels in the last two years.

My proposal here is that we reduce, not increase prices. We put a price cap in to control the cost of running these programs. You can use TAFE as a model. You could use the university system as a model which allows for the provision of quality training which leads to real jobs and real qualifications and still provides a reasonable profit for private operators but not these superprofits these companies have been getting. They are reliant on government subsidies through this scheme for up to 80 per cent of their revenue. You have to remember that it is not jus the Commonwealth that is tipping into this; the states are tipping in as well.

The government has a responsibility to ensure the value for taxpayers' money. We in this chamber now all accept that there are abuses and that it is better to seek boundaries for the expenditure of public moneys. We protect the most privileged professions like medicine through setting of fees at universities. We have no trouble with that. Administratively there is no difficulty whatsoever. It may well be that those same schedules could equally be applied in the VET sector with very little modification. But it appears that it is too difficult to protect the most vulnerable in the vocational education system— (Time expired)