Ms Anna Burke (Chisholm, Deputy-Speaker) Share this | Hansard source

I am proud to speak in support of the Higher Education Support Amendment (Removal of the Higher Education Workplace Relations Requirements and National Governance Protocols Requirements and Other Matters) Bill 2008, which will mark a positive new beginning for the relationship between the federal government and Australian universities. This bill will amend the Higher Education Support Act 2003 by repealing section 33, subsection 17. It will remove the higher education workplace relations requirements and the National Governance Protocols requirements that dogged university administration for five years and made their jobs so much harder—all because of the Howard government’s ideological power trip to impose AWAs on university staff and get greater control of university decision-making processes.

Under section 33-17, a university would have its basic Commonwealth Grant Scheme funds reduced by 7.5 per cent if it failed to satisfy the minister that it had complied with both the HEWRRs and the protocols. This bill is also important to me because I have two fine universities in my electorate: Monash University at Clayton, one of Australia’s largest universities; and the city campus of Deakin University at Burwood. The contribution that these two universities make to the Australian economy and to the life of our nation is significant. Both have excellent reputations in teaching and research. It was an honour to have the Vice-Chancellor of Monash University, Richard Larkins, up last night listening to the budget.

A significant number of the universities’ students, staff and graduates live in my electorate. So universities are not only important to the country but they are vitally important to my local community. It is therefore of personal interest to me to see a better relationship between universities and our government. It is also greatly in the interests of Australia. Unlike the Howard government, the Rudd government does not see universities as places for the elite—quite the opposite. For us, universities are places where every Australian can aspire to excellence in whatever field they choose. We acknowledge universities as the engine rooms of innovation and social and economic progress.

I was recently quite startled to read that former Prime Minister John Howard’s brother said that his family had a hatred of academics and public servants. I was quite stunned that family or you as an individual would have an active hatred of academics and public servants—people who give to our communities, people who offer their services for the betterment of our society. So I suppose what we saw in the previous government rang true to that philosophical belief.

The Rudd Labor government sees universities at the centre of our efforts to lift prosperity, enhance opportunity and wellbeing for Australians, and to increase productivity in our economy. Universities are a key part of the education revolution. This was set out yesterday in the budget through our investment in higher education. In yesterday’s budget the Treasurer announced a funding injection of more than $2 billion for higher education—and I can tell you that it is incredibly welcome within my electorate. Indeed, I am delighted to say that Monash University has received $29.6 million in extra funding for urgent capital works to renew and upgrade information and communications technology systems, laboratories, libraries and student study spaces, teaching spaces and student amenities. Deakin University received $13.8 billion for the same purposes. This will help significantly.

These funds will go a significant way towards repairing the damage done to the universities through the years of neglect of the Howard government. This funding has been welcomed by university staff and students alike. The Rudd government is investing in higher education to build stronger universities for the future benefit of us all. Not only are we investing but we are building a new and better relationship with our universities and the people who teach, research and learn within them. The new relationship is built on trust and respect and on the building of diverse, different universities, each pursuing a distinct vision and mission.

Now let me return to the matter of the bill, which will go a long way towards restoring trust and respect between the government and our universities. It will take the foot of the government off the throat of universities and let universities get on with what they do best—that is, teaching and research. Under the Howard government relationships with universities were marked by distrust. One of the worst manifestations of this trust was the requirement that universities abide by the higher education workplace relations requirements and the National Governance Protocols, which forced them to pursue the Howard government’s approach to workplace relations or suffer a penalty. Under the Higher Education Support Act 2003, enacted by the Howard government, higher education providers had to meet the higher education workplace relations requirements and the National Governance Protocols as a condition of the Commonwealth Grant Scheme funding for student places. If the universities did not meet the HEWRRs and the protocols, their Commonwealth Grant Scheme funding would be reduced.

The HEWRRs required universities to implement the Howard government’s ideologically driven workplace relations agenda. One aspect was that universities had to offer Australian workplace agreements to employees, otherwise they would lose funding. This was so-called choice in agreement making, but it was not popular with staff or students and provided no choice. Indeed, in 2005 the Australian Vice-Chancellors Committee, or AVCC—now known as Universities Australia—opposed the higher education workplace relations requirements, claiming that they would be inflexible and increase administrative workloads. Tellingly, the AVCC said they would be:

... very intrusive in terms of universities’ capacity to manage their internal affairs. The HEWRRs proposal constitutes a ‘one size fits all’ approach, whereas the AVCC takes the view that the focus should be on desired outcomes, rather than specific industrial processes and particular industrial instruments.

So the AVCC had effectively outed the government’s legislation as the ideological power trip that it was. After all, who should know better how to run the universities than the universities themselves? But, rather than follow the AVCC’s advice, the Howard government arrogantly went ahead and put the proposal into law. But staff did not exactly flock to take up the offer of AWAs either. By July last year, out of 150 AWAs offered only 2,000 university staff left the security of collective agreements to go onto individual contracts. Clearly AWAs were on the nose. The proof of the pudding was in the eating and the staff were not exactly lining up for a serve.

But the Howard government went even further than merely offering staff the so-called genuine choice between collective agreements and AWAs. In July last year the University of New England was threatened by the Howard government that, unless it offered jobs on an AWA-only basis, it would lose its funding altogether. How completely outrageous! We knew that the Howard government was desperate to stamp out collective bargaining in a free and fair environment and disallow staff the opportunity to be represented by a union, but this was just beyond the pale. The standover tactics and unwanted interference in the university’s industrial affairs were just breathtaking, and they did absolutely nothing to engender confidence in the university sector or to build sound relationships between the government and the universities. In fact, it did the opposite. The Howard government did not trust universities. It regarded them with suspicion. It believed that universities needed to be controlled and told what to do and how to do it—the Howard government way. Universities were told how to run workplace relations and how to manage their own governance and affairs according to the Howard government’s own mad ideological agenda.

The HEWRRs and the NGPs were the tools of control and the symbols of mistrust. Severe financial penalties imposed by the Howard government on universities for not running things the Howard-Costello way meant core funding for teaching and research—the very roles that universities are meant to perform—was reduced. The higher education workplace relations requirements and the National Governance Protocols showed that the Howard government thought it knew better than university leaders and staff how to run their institutions. It marked a trend of increasing centralisation of power over universities by the Canberra bureaucracy that would lead to more, not less, control and intervention in university operations. The governance protocols required universities to adhere to a one-size-fits-all model of how to run a university. There was a set of standards covering the size, composition and duties of university governing bodies. Again, the universities were not in favour of the protocols. The previous government said they were not interested in interfering in the affairs of business. Universities are large businesses and they certainly interfered extensively in them. While they had to accept and implement them, they opposed any further prescriptive requirements that added costs and compliance requirements that were inconsistent with potential benefits. These protocols added a costly administrative red tape burden on universities. In their submission to the review of the protocols, university chancellors and vice-chancellors stressed:

... it was not wise to apply a “one size fits all” governance model (that extends into areas of management), particularly when the stated object of the Government is to promote diversity ...

This was again the Howard government meddling in university affairs to fit its own ideological agenda.

This bill removes those tools of control. They are not needed in this new era of trust and respect between the Rudd government and our universities. The Rudd government will take the foot of government off the throats of universities. The Rudd government trusts universities to manage their own workplace relations. The end of HEWRRs will clear the way for the Rudd Labor government to develop healthy new relationships with universities, staff and the unions who are active in them. Universities will no longer be required to offer AWAs to employees to get funding. Higher education providers will be subject to the same laws as all other employers. Full government grant funding will now flow to our universities. In the future, relations will be based around negotiated funding compacts reflecting the distinct mission of each university. The Rudd Labor government’s tools will be tools of accountability and focused on results or outcomes, not on process and inputs. University funding compacts—to be first negotiated between the government and each university in 2009—will hold universities accountable for their use of public funds and for the delivery of agreed outcomes linked to each university’s distinct mission. Funding compacts will be agreed between respected and respectful parties; they will not be a standover set of requirements set on pain of financial penalty. The Group of Eight universities envisage that under a compact model of university funding:

... there will be a much reduced compliance, bidding and reporting burden placed on universities, and greater flexibility over the use of resources ...

This will free our universities from restrictive, directive requirements that have diverted time and effort away from where it is needed most: the delivery of quality teaching and research. While the protocols will be removed as a condition of funding, the Rudd government will continue to encourage universities to adopt good governance practices and increase productivity and efficiency.

In addition to these timely changes, a number of technical adjustments have been made in this bill. In relation to the approval of higher education providers, this bill amends the act so that the approval of a provider that no longer meets certain criteria may be revoked. For example, if the provider no longer has its central management and control in Australia, this bill enables its approval to be withdrawn. The bill also amends the arrangements for quality auditing of higher education providers. Currently, the only quality auditing body in this country is the Australian Universities Quality Agency. This bill amends the act to allow the Commonwealth to designate additional bodies, such as state and territory government accreditation authorities, to perform this role. This bill will set limits on the providers that can be audited. This is also an efficiency measure. By state and territory government accreditation authorities conducting audits at the same time as they conduct their normal registration and approval processes, the administrative burden on private providers will be reduced. The approach has been subject to consultation with private providers and a trial process with two state accreditation agencies, Queensland and Victoria. The approach has been well received. Importantly, the bill also includes the addition of a transitional mechanism so that existing funding commitments made to providers under the Collaboration and Structural Reform Fund can be honoured now that the new Diversity and Structural Adjustment Fund has been established.

The Rudd Labor government is committed to a strong, diverse higher education sector that makes an essential contribution to our national prosperity. We look forward to rebuilding the relationship between government and higher education providers. We want to turn around the decline in our universities that so marked the Howard government years. It presided over a massive decline in public investment in our universities. From 1995 to 2004, while other OECD countries increased public investment in tertiary education by an average of 49 per cent, on the Howard-Costello watch public investment in Australia was cut by four per cent. Their legacy has been to leave our higher education system lagging behind the rest of the world.

Over the course of the last decade the issue of human capital has risen dramatically in public policy importance globally. Policy makers now accept that investing wisely in knowledge, skills and innovation is one of the best means available to ensuring long-term prosperity, leading to both overall economic growth and to better education and work opportunities. Around the world governments have responded by increasing their policy focus in all areas of education, particularly higher education—everywhere, it seems, except here in Australia.

In Australia since the mid-1990s, higher education has been subjected to a seemingly random blend of neglect with occasional bursts of ideologically driven interference. Public funding has been cut. Too many faculties at our universities are in decline, with a huge backlog in deferred maintenance. Financing has become chaotic, compromised and unsustainable, based on ever-higher fee burdens and a dangerous over-reliance on cross-subsidisation from overseas student revenue. A bewildering array of student financing arrangements has been put in place, each change adding another layer on top of past mistakes, but none advancing the important goal of educational equity. The academic workforce has been allowed to age and the quality of campus life has been undermined. We have even seen the sad spectacle of higher education policy being driven by a sometimes highly unsustainable anti-intellectualism, with the central idea of higher education—the pursuit of knowledge as a crucial public good—dismissed as the wasteful activity of a selfish elite.

Despite the mishmash approach of the Howard government, which ranged from neglect at one moment to ideologically driven interference at the next, most of our universities struggled through remarkably well. It is a great testament to the quality and commitment of our university leaders and the academic community. Thanks to their commitment the number of those in higher education remains high, graduate employment outcomes are strong, graduate and employer satisfaction levels are generally good, provision of higher education to international students has grown to be one of our leading export sectors, and we have notable areas of world-class research.

Labor’s achievement in the eighties and nineties was to shift our higher education system to a mass system, building on record levels of secondary school attainment. Other nations adopted our approach. But, under John Howard, government slept at the wheel for more than a decade. The Rudd Labor government is now taking up the next reform challenge—to inject diversity, choice and the highest quality into our mass higher education system. Unless we resource and respect higher education institutions, we simply will not maintain our standard of living. It is clear that Australia needs a new direction in national higher education policy, one that aims to exploit fully our human capital potential in order to spread opportunity, raise economic productivity and transfer the economic gains of the resources boom into sustainable prosperity for all in the future. Our goal must be the creation of a globally competitive higher education system for a modern Australia.

The education revolution policies Labor took to the federal election and which we are now implementing have begun to address the neglect of the last 11 years—by targeting resources to areas of skill shortage, by restoring equity and by enabling university leaders to get on with the business of running their institutions without interference from politicians and public servants. But the reform process will need to go further. Taking it further will require no less than a system-wide rethink. To facilitate that, we have announced a major review of Australian higher education, which will help us shape the next steps in the education revolution for our universities. And we have announced a new long-term goal for our post-secondary education system: guaranteed access to higher education or skills training for every young Australian with the talent and willingness to give it a go.

I am a proud member of a government that understands the importance of education to our economy and to our society. The Rudd government’s rationale for improving the performance of our higher education system is that higher education leads to higher productivity, which leads to higher economic growth. This case is now well accepted by the world’s leading economists and economic bodies. Human capital economists like the University of Chicago’s James Heckman, who won the Nobel Prize for Economics in 2000, have been telling us for some two decades that public spending on education and skills leads to higher rates of return on investment for countries. OECD analysis of human capital suggests significant positive correlations between rising levels of educational attainment on the one hand and both economic growth and improved physical and mental wellbeing on the other. The organisation has estimated that one year of average additional educational attainment for a population adds between three to six percent to long-term GDP growth.

Our competitor nations are aware of this thinking and have been acting on it. Australia, by contrast, has not. Consider this analysis. Between 1995 and 2004 public funding of tertiary education increased by an average of 49 percent across the OECD but declined by four percent in Australia. This makes Australia the only OECD country where the total level of public funding of tertiary education decreased during that time. While private investment in Australia went up by 98 percent, this actually compares poorly with the average OECD increase of 176 percent. Most nations managed to increase both public and private investment substantially. Rather than leverage more private investment through a partnership for growth, Australia shifted responsibility from the public sector to the private. Mostly this has meant a shift to individual students and their families, who have paid more through higher tuition fees. Between 1995 and 2004 total funding per tertiary student increased by an average of nine percent across the OECD but increased here by only one percent.

Australia is now starting to fall behind our competitors in graduations in crucial areas. We are now below the OECD average for the proportion of graduates in science and agriculture, and way below them in engineering, manufacturing and construction—7.2 percent compared with 12.2 percent. In Korea the figure is 27.1 percent—four times Australia’s density. Research is also being badly affected. In the last 10 years, research output has grown rapidly in countries like Singapore, Korea, Taiwan and China—which is now the second biggest investor in research and development in the world. But it has only limped along here in Australia. If you want to know why investing in research is important, ask the University of Queensland’s Professor Ian Frazer, who discovered the vaccine for a cancer that kills 250,000 women every year.

Over the last decade, Australian higher education has practically stood still in terms of numbers, quality and output, while our competitors have surged ahead. The picture is clear: we are under-investing in our human capital, and in the long run this will stall our global competitiveness. This policy failure has grave potential consequences for every single Australian. We have been led to believe in recent years that what happens to our universities does not matter to ordinary Australians. This is a dangerous fallacy. Every Australian is now feeling the consequences of the Howard government neglect of higher education in things like a shortage of Australian-trained doctors and nurses; a shortage of early childhood educators and school teachers, especially in crucial areas like maths and science; and a shortage of qualified engineers and logistics workers for our booming resources and construction sectors.

Skill shortages are driving up the cost of doing business as we all end up paying through higher inflation and higher interest rates. If you want to know why investing in higher education is important, simply look at the waiting list at your hospital or GP surgery, the lack of subject choice in your child’s school, the rising costs of items in the shop and your monthly bank balance. By boosting national productivity, increasing Australia’s investment in higher education will ultimately allow us to sustain higher economic growth with lower inflation and interest rates. The new President of the Business Council of Australia, Greg Gailey, got it right recently when he said:

More than ever, governments need to focus on fiscal policies and broader reform agendas in areas such as infrastructure, education, skills and workforce participation that collectively enhance the nation’s capacity to grow.

Australia simply cannot afford a short-sighted, ideologically driven and backward-looking approach to higher education policy any longer. The moment is now for us to start seriously investing in human capital at all levels, including higher education. For that reason, I commend the bill before the House this evening.

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