Sharon Bird (Cunningham, Australian Labor Party, Shadow Minister for Vocational Education) Share this | Hansard source

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.

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