Higher Education And Research Reform Amendment Bill 2014

Click here to watch Sharon's speech

Ms BIRD (Cunningham) (19:06): I rise—and this probably will not surprise the House—to speak against the Higher Education and Research Reform Amendment Bill 2014. The previous speaker, the member for Mallee, said that he is concerned that people are being frightened by the sort of money that is being talked about by the opposition and that they have no reason to be. I would very much caution him about going out to his electorate and making assurances that people will not be facing the potential costs of university in those sorts of figures, because the very point of deregulating is that you cannot make those guarantees, you cannot make those commitments to the electorate, and that is exactly the concern that the opposition has.

The bill seeks to implement the government's unfair budget changes to higher education. There are two aspects that are particularly a problem for the opposition in dealing with the proposal put in the budget. The first was that yes, this is massive change and reform in the higher education sector, and there has been no lead-up to it whatsoever. There was nothing about these proposals before the election. There was no conversation with the community more broadly about what the government was proposing to do in the university sector. For a government that in opposition regularly scaremongered about what reforms meant and how they should appropriately be introduced, this government is completely contradicting every benchmark it has set for any government in this place. It did not put the reforms before the population before the election. It did not engage in an extended and detailed conversation with the community about them.

One year ago, before the election, the Prime Minister—the then opposition leader—actually promised the Australian people that there would be no cuts to education. He said:

I want to give people this absolute assurance, no cuts to education, no cuts to health, no changes to pensions and no changes to the GST.

I acknowledge that the last point might be a contentious one for those opposite today. The Liberal Party policy document was Real Solutions. What did it say? It said:

We will ensure the continuation of the current arrangements of university funding.

After the election, in November last year, Minister Pyne further reinforced the government's promise from before the election. He said:

We want university students to make their contribution but we're not going to raise fees.

When asked at the time, 'Why not?' he replied 'because we promised we wouldn't before the election'.

And then, in the Liberal government's first budget, they broke these promises. It was a triple whammy of higher education changes. Course funding was cut, fees were deregulated and, to add the final hit, compounding interest was introduced. These changes reflect the government's twisted priorities. We need to be investing in education—exactly the point that the previous speaker, the member for Mallee, raised—and in particular in regional and rural Australia. We need to be investing to create a future workforce where we can ensure that the demands of our modern economy will be met and, most importantly, that our children are able to receive the education, skills and training that they need in order to start a pathway to their lifetime career. This bill seeks to deregulate university fees. So, as I said, the previous speaker and many of those on the other side cannot, despite their claims to the contrary, make any guarantees about what will happen with university fees. In fact, universities holding O weeks for students across the country at the moment cannot make guarantees to students as they seek to get them to enrol for the beginning of next year on what their fee structure will be before they finish their courses.

Mr Nikolic: How do you know it is going to be $100,000?

Ms BIRD: Well, let me take the member through that. Let us talk first of all about the fact that current undergraduate degrees have had a funding cut of, on average, 20 per cent. At the moment, what the Commonwealth funds towards the cost of running a course has been cut, on average, by 20 per cent. The figures produced by University Australia indicates that some of those will be up to 67 per cent.

Mr Nikolic: 'Indicates'—oh, 'indicates'!

Ms BIRD: If the member has any evidence—and I am sure he will speak after me—any evidence at all that courses will go down in cost, I am waiting breathlessly to hear it, because we have challenged those on the other side to give us one piece of evidence, one piece of international research, one piece of domestic research that says that the cost of university courses will go down or indeed stay the same, and they have produced no evidence. We have relied on the work that has been done by people like Universities Australia.

Mr Nikolic interjecting

Ms BIRD: The member laughs at them.

Mr Nikolic: Where is your data and evidence?

Ms BIRD: Universities Australia have produced research on what the impacts will be, if the member wants to look at that. He could also look, for example, at the cost structures that are put in place under deregulation for international students and the sorts of costs that are there. There is plenty of evidence available. Currently the government proposes, first of all, to decrease the amount the Commonwealth pays towards the cost of courses. Then, of course, universities have their fees deregulated. So, what they will seek to do—and most universities will have to do this—is at least increase the fee to cover the cut in the amount that is Commonwealth-supported funding. So, for students who are looking at those courses, their share will increase, at minimum, by the amount that the Commonwealth funding for that course has been cut so that universities are not actually going backwards.

Then, of course, the government touts its Commonwealth Scholarships Program. Well, how are the scholarships funded? It is not Commonwealth government money. What actually happens is that universities, once they have covered the cost of the cut to the subsidy for the course, can then charge whatever they like. So, if they decide to charge additional, above and beyond making up that cut, they then are required to use $1 in every $5 to create a scholarship. To give an example, I and my colleague the member for Melbourne Ports are at university and we are enrolled in a class.

Mr Hartsuyker: What a class it would be!

Ms BIRD: It would be a class of great quality. The member for Melbourne Ports is paying his fees, so the university thinks, 'Well, we'll charge an extra 20 per cent to the member for Melbourne Ports.'

Mr Danby: I'll drop out.

Ms BIRD: And with the poor old member for Cunningham, the university thinks, 'We'll be charitable to her and give her one of these Commonwealth scholarships.' The member for Melbourne Ports is actually paying for that scholarship. The reality is that those students who will be paying additional costs for their courses will be funding people who will be sitting with them in the classroom but who will have a scholarship. So let us be honest: this is not a Commonwealth scholarship; students will be funding their colleague students through the increased costs that they will be paying for their education. This is what is going on here.

Then of course added to the deregulation is the introduction of interest that compounds over time. Much information has been produced which shows that this particularly impacts on women who take breaks from the workforce. I also want to point out that it will also impact on those who get professional qualifications but who may want to work in the more charitable based sectors of our economy. I am talking here about people like doctors who might want to work for some of the Indigenous health services or lawyers who might want to do community based legal work, where they will get a much lower income. They will probably still earn enough to be required to pay their HECS debt back, but they will be paying it back at a much lower rate because they will be earning much lower incomes. The real pressure is going to be on them to say, 'I've got this debt and it is actually accumulating compound interest, and so can I really afford to take time out in my earning life to do the sort of work where I am going to earn a very low income and accumulate interest on my debt at a faster rate than if I took a high-paying or more lucrative job?' So it will not only be women who will take a period of time out of the workforce who will be impacted by the pressure of accumulating interest; it will also impact on people who have high-level professional qualifications but who want to do low paid community based work—work that I hope we would all want to encourage. So there are some real inequities and there is some real unfairness in the way that this bill will impact on people.

The other point that I want to draw to the attention of the House is the significant impact that this legislation will have on universities in regional and rural Australia. It is certainly the case in my own area that the University of Wollongong is looking at a significant cut to its funding. The amount by which that funding is potentially being reduced is around $98 million over the period of this reform. The University of Wollongong is in an area of high youth unemployment. I have to say that it is a university that a lot young people from regional and rural New South Wales attend. I regularly go out and meet with the student body over there, and young people from all around New South Wales come to Wollongong university. So the reality is that, with the best will in the world, universities that may not want to put up their fees will not be able to avoid doing that.

An important point for people to understand is that there is a retrospective aspect to this bill. Recently, I was talking to a young lady who I know. She graduated in 2008 from the University of Wollongong, with a bachelor of arts in human geography and sociology. Then she went to the University of Sydney and did a masters in public policy. Her total HECS debt is approximately $35,000. She has recently purchased a house with her fiance, and they plan to get married next year. She was stunned that the government could change the terms and conditions of her existing HECS debt and that she could now be liable to pay interest of up to six per cent per annum. She said to me that, when she looked at the announcements initially, she had no understanding that this was going to apply not just to current university or potential or prospective university students but also to people who have graduated and, indeed, who graduated many years ago. If they carry forward a HECS debt, the change from the CPI indexation to an interest rate being charged will affect them as well. So for many young people who are starting out, who are relatively recent university graduates, undertaking mortgages and starting families and so forth, it is going to be a bit of an unpleasant shock when they discover that this bill actually means that the conditions of the loan that they entered into—thinking that they understood how it was going to operate over time—has actually been changed by the bill that is before us.

I think many people are aware of this. Belinda Robinson, who is the Chief Executive of Universities Australia, recently said:

... if we're not careful, what we will start to see is a situation where students are being deterred not only from participating in university study but from in fact taking time out of the workforce to do things like raise children, because it will be such a financial burden for them once they re-enter the workforce.

These changes will have a very detrimental effect on women and young families who are trying to get a start on life, such as getting a mortgage. This legislation creates a particular concern in terms of it being a disincentive to young people.

As I indicated, the so-called 'sweetener' is a scholarship program. I make the point again that it is not a Commonwealth scholarship; it is a scholarship funded by other students, who are paying higher amounts of money in order to provide that scholarship. It is also not accurate to say, as the minister constantly does, that at the moment people pay 40 per cent of the university costs and now we are only asking them to pay 50 per cent—as if that is not a significant change when the cost of a course has gone up significantly to start with and then there is compound interest on top of that. I think that is a misleading way to indicate how the impacts will be felt.

At the end of the day I think those opposite who get up to speak in support of this package will find that it creates quite a bit of grief in their electorates. I do not think it is a fair proposal to put before the electorate. I would suggest that, if those opposite really think it is such a great policy reform, they should hold off and take it to the next election. See how well it goes then. Put in your newsletters and your election campaigning material that this is what you want to do. See how well it goes down.

Mr Danby: Do as John Howard did with the GST.

Ms BIRD: As my colleague said: do as John Howard did with the GST. Run it by your electorate. Try and convince them of the arguments that you are putting to this House and let us see if they endorse the package. I profoundly believe that they will not, because it is fundamentally unfair at its heart. It makes university access based on your wallet not on your capacity, and that is never going to be acceptable.