VET Student Loans Bill 2016

Ms BIRD(Cunningham) (11:16): It is a pleasure to be able to continue to speak on the VET Student Loans Bill 2016 today and, in particular, to support the amendment put forward by the shadow minister for TAFE and vocational education, the member for Adelaide. This cognate debate addresses some very significant and important issues around the VET FEE-HELP scheme. As the shadow minister has rightly indicated in the amendment that she put forward, there is an absolute need, given the history leading up to this point, to have a look at the decisions the government have made so far and what has happened on their watch with this scheme, and to allow that understanding to feed into how we respond to this bill.

As the shadow minister indicated, the bill has our in-principle support, but we are concerned to ensure that the detail and the implementation are well understood and well explored. This is important because we have seen, since around 2014, a number of changes made by the government to deal with the VET FEE-HELP scheme. I have to say most of those—in fact, all of them—have been supported by the opposition, but, on each and every occasion, we have made the point to the government that they were not taking serious-enough action and they were not acting fast enough. So we again find ourselves with another bill before the House dealing with the VET FEE-HELP scheme and we need to make sure that the detail is right.

As many of my colleagues in this place understand well, the vocational educational and training system is complex, it is very large, but it is also critically important to the skills development of this nation, to job opportunities for people across all of our communities, to the expansion and growth of new businesses and new industry sectors. It is not given too often the attention it deserves as an important sector in the education story across the country.

I was very pleased when we first went into opposition that the Leader of the Opposition, Bill Shorten, gave it priority and created a dedicated shadow ministry for it. It is a bit disappointing to see the government, having followed that led, now downgrade it to an assistant minister position, although I acknowledge that the minister in the other place has responsibility for and carriage of it as well.

The VET FEE-HELP payment system sits within the HELP scheme, and the story of how this developed is important to understand so you can look at how you are going to deal with the rorts and disgraceful behaviours that have been exposed in recent years. Of course, John Howard originally put forward the proposition to extend the HELP scheme to people who were studying in the vocational education and training sector. When Labor came into government, we implemented and continued that proposition because it was clear that some people studying at the higher levels of vocational education were facing costs that were a bit prohibitive in terms of finding the money up-front. So it was then, and I think it is still, a reasonable proposition to have a loan scheme available.

There were some changes made in 2012 to the scheme to broaden its capacity to provide funding for students doing diploma levels, with a bit of a trial around the certificate IV level qualification. Given the nature of the debate that has gone on this place and the attempt by government speaker after government speaker to portray this as a Labor failure somehow, it is important to point out that not only was it initially John Howard's idea but the introduction and changes that we made in government were supported by those opposite. In fact, some of them in speaking made the point that it was good to get red tape out of the sector.

By 2014, there had been a change of government and those opposite were in power. There started to emerge, particularly in the media, stories about abuses happening in the scheme, and those were largely around quality issues and the exploitation of students.

My first comments on my concerns about this were in response to the ASQA reports that were done on some of the industry sectors and behaviours that had become apparent and that ASQA were alerting the government to. In the intervening time, Senator Kim Carr and I began to raise with the government our serious concerns about what was happening with the scheme. Now, if you set up any government scheme—and those opposite are progressing a line that governments can set up schemes and then just turn a blind eye and ignore whatever happens to them—you actually have to monitor and be on top of what is happening in that scheme as it operates.

I have with me a massive pile of media releases that Senator Carr and I put out over that period of time calling on the government to respond with some urgency and effectiveness to what was unfolding in the sector. They start from February 2014. At that point, it was becoming quite obvious that quality was in danger. At that point, it was then Minister for Industry, Minister Macfarlane, who was responsible for the sector. We were concerned, particularly because ASQA reports had come out about different sectors where issues had been raised of exploitation and poor quality. The minister was at that point basically running the line that there was too much regulation in the system, and that caused us very great concern.

Between then and now, there was report after report on this in the broadsheet newspapers and the ABC's Background Briefing ran some excellent exposes. It was quite clear that there was a significant market failure that meant that vulnerable students were being signed up to completely inappropriate courses at exorbitant prices with little chance of repaying their debts. There were real implications on many levels that required serious action. The government did some tinkering around with standards and the operation of the scheme, over a number of changes. On each occasion we said: 'We will support this; it is good. You need to deal with standards and you need to deal with regulation, but you need to go further; this is a systemic problem.' But we kept being told: 'No, these are one-offs. It is just a small section of the private education sector that is doing the wrong thing.' That was not the case. There was evidence brought before the House of Representatives Standing Committee on Education and Employment and the Senate committees about the systemic nature of this behaviour and how problematic it was.

The really frustrating part of that was that the year we left government about $700 million was spent on VET FEE-HELP loans. That had blown out to $3 billion in the 2015 year. It was growing at an exorbitant rate—a rate that one would think would raise some sort of red flag with the government. I mean, in 12 months the scheme more than doubled. There were providers who in a 12-month period massively increased the amount of training they were providing. Anybody who understood the system would have been looking at that thinking: 'Hang on. How on earth can you grow at that rate and actually be delivering quality education and training?'

The system of VET FEE-HELP was sending red flags that the government should have been aware of, should have been monitoring, and should have responded to more quickly and more effectively. Under this government's watch, we saw over that time massive damage being done to the reputation of the sector, significant disadvantage to the students who were being signed up and completion rates of five per cent. Why? Because there was no interest in signing up students who had the capacity to complete the course. In fact, infamously, one provider on Paddy Manning's ABC radio show said, 'That was an effective business model. It is actually much cheaper if you sign up people who have no intention of studying'—just an extraordinary attitude and extraordinary behaviour.

Prior to the election, the government put out their discussion paper. I was quite critical during the election campaign of the fact that the government did not have any policies in the vocational education and training sector other than the discussion paper and the implication at the time that that would lead to a second paper with detailed proposals. Instead of that, of course, we now have the bill before us. So I am sure that people will understand why, as an opposition who absolutely care about this sector, we want to make sure that the detail is right this time and that it is well understood and explored across the whole sector.

In the context of VET FEE-HELP sitting within the vocational education and training sector, I also make the point very strongly to government—since they have grabbed all Labor's policy proposals on VET FEE-HELP, including the cap which they have now adopted but which they spent all the election campaign rubbishing and scaremongering about—that this sector deserves more attention and more commitment from the government than it has seen since 2013. The sector has had over $2 billion ripped out, programs for workforce development scrapped, programs for language and literacy scrapped and apprenticeship programs gutted. The end result of that is that we have seen massive and significant damage to a critically important sector. We have seen over 120,000 apprenticeships across this country lost under the government's watch. They need not only to deal with the VET FEE-HELP issue but to get a strategic approach to vocational education and training and give it a serious commitment.

At the election, we put forward a proposal that we would in government have a sector-wide review. We did Gonski for the school sector; we did Bradley for the university sector. It is absolutely time that there was a review of the entire vocational education sector, how it is delivering now and how it will deliver in the future. An important part of that is the fact that within the sector sits our great public provider—our TAFE systems. As a result of what has gone on, they are being brought to their knees in many, many places. We saw the devastation in Victoria, and the Andrews government are now having to rebuild the TAFE sector in that state. In New South Wales, my colleague from the Central Coast and I have seen what is happening to TAFEs in regional and rural areas in particular, where you are seeing courses cut, staff sacked and campuses closed. This is a critically important issue. I know the government do not like to mention public sectors at all and I rarely hear them mention TAFE, but they need to get behind rebuilding and supporting our public TAFE institutes. TAFEs are the backbone of the VET sector—they set the standards, they tell people what quality looks like and they tell people what a reasonable price looks like. So the government need to take real action in supporting TAFE across the country.

I would also say that there are some great private sector providers out there, and this scandal has damaged them. There are people who have been around for decades with real expertise in their particular area, with a love of education, who do a sterling job across the not-for-profit and profit based private sectors. They deserve not only for the problems in VET FEE-HELP to be addressed but for the government to take a serious look at how vocational education and training is going to operate into the future. They deserve some certainty and direction so that they can continue to operate as well. We need vocational education and training put on the front foot and on the agenda of this government. Labor have been calling for this since 2013. There should be no more cuts. The government are about to make $7 billion in savings out of these measures. Let's see some of that money reinvested in the vocational education and training sector; let's hear a serious conversation about a new national partnership; and let's see some real action to back TAFEs and apprenticeships.