Wyatt Roy (Longman, Liberal Party) Share this | Hansard source

I rise to speak on the higher education reform package which is contained in the legislation before us here tonight, the Higher Education and Research Reform Bill 2014. The starting point for this debate is really about the issue of almost national pride as a country. Depending on how you measure it, we are essentially a top eight economy across the globe—yet we do not have a single university in the top eight. I think when we are excelling on so many different fronts across the globe, surely it is reasonable to expect that Australian students have the right to a world-class education, particularly a world-class higher education system, in this country. Surely Australian students have a right to expect that, when they go to a university in this country, that university is competing with the world's best—whether in the United States, the United Kingdom or, particularly, within our growing region in Asia. The reforms that we are talking about here tonight will be the key that unlocks the door to that reform that allows our universities to compete in the global marketplace and ensure that Australians are studying at world-class institutions—ones that compete with our friends across the globe.

It is also important that we maintain higher education as something that we export to the world. We know that higher education was the third largest export for our nation—something that we should be proud of. But, as we have over a billion people coming into the middle class in Asia, it is right to expect that our universities maintain their high standards and reach further so that we can continue to attract students from across the globe to study here in Australia. That is something that we should be proud of and we should be seeking to expand—because, not only is that an issue of pride; it is also an important economic issue. As we face significant challenges with an intergenerational debt burden, with the potential coming off of the mining boom, it is important that we can export other things.

As I said, education was the third largest export for our nation. Under the former Labor government, a government that was too timid to reform in this place, we saw international student enrolments in Australia fall by 130,000 places—a fall of 16 per cent. It is so important that, as we look at those long-term structural economic challenges that we face, we are able to say that our neighbours do not just want to buy our minerals resources and they just want to buy our agricultural goods but they also want to buy our services and they want to learn and study here. It is something that we should not be afraid of reaching further for as a nation.

The other issue that these reforms address is putting our university system on a sustainable funding model. The former Labor government essentially deregulated student numbers to create a demand-driven model. I do not think members in this House have large contention around that. But what they did not do was deregulate the fees which actually provided the funding for a demand-driven model. Paul Kelly, in the Australian, put it quite simply: you have a system where you have a demand-driven model in terms of the student numbers, which created the cart, but, without the funding stream to do that—without the deregulation of university fees—you do not have the horse to drive the cart.

This is an incredibly important reform that we have to go through. It is the next stage of reform to ensure that our universities can reach that global standard and are accessible to Australian students regardless of their background. I note that the former speaker was sort of deriding the Group of Eight universities and saying that students in western Sydney only want to go to average universities and they do not want to go to the best universities in the world. I am the first person in my family to finish high school and the first person in my family to go to university, and I say that, in this country, regardless of your background, you have every right to expect that the university you study in is a world-leading institution.

These reforms will ensure that, regardless of where you come from, you have the ability to study in a university that can compete with the best universities across the globe. These reforms will ensure that we have an opportunity to have the best universities in the world. They will ensure that we have a market to drive more international students to come here and increase export nations as a nation and they will ensure that these universities are put onto a sustainable funding model that meets a demand-driven model for student numbers.

I think that it is important that we have a look at what people in higher education have to say about these reforms. I might go through some of them from Paul Kelly's article which I mentioned before. The peak body representing Australia’s universities says that these reforms represent a 'once in a generation opportunity' to shape a higher education system 'that is sustainable, affordable and equitable' for students and the nation. Universities Australia chief executive Belinda Robinson said that failure of the package will condemn the university system to 'inevitable decline. The Group of Eight universities told the Inquirer:

Unless there is reform we will continue to drift, we will fall behind the emerging universities of Asia and we will fall out of touch with the vital global centres of knowledge.

The current Group of Eight chairman and ANU Vice-Chancellor Ian Young said that in the current system, the unreformed system:

We have created a perverse incentive that rewards universities for enrolling as many students as possible and teaching them as cheaply as possible.

Adelaide University vice-chancellor told the Sydney Institute these reforms will more diversity, less centralisation, more choice, better value and superior teaching. If that is what those in the higher education sector are saying about these reforms, I do not think as a nation we should step back and say that we do not want to engage in something that will enable us to be world leaders in higher education.

I think it is important that we go through what this actually means for students—for people like myself who are the first people in their family to decide that they want to go to university; for everyday Australian students regardless of their background. The first point that I would make is that education has not been free in this country for a very long time. The Labor Party introduced the HECS based system—a system that essentially means that students do not pay a dollar up-front for their education and they only pay back the money that is expended on their education when they earn over $50,000. That system does not change with this legislation. You will not have to pay a dollar up-front for your university education.

Today we have about 40 per cent of Australians getting a university degree and taxpayers fund about 60 per cent of that degree. These reforms would mean that that might go to between 40 per cent and 50 per cent. Really, these reforms are saying that you are going from taxpayers paying 60 per cent of your degree to taxpayers now perhaps paying 40 per cent of your degree and you will then have a loan for the rest of your degree, and you will not pay back a dollar of that degree until you earn over $50,000. This is a really important point, because, if the impediment is the cost of the degree and you are saying that your social economic background will determine whether or not you go to university, you will not actually pay a single dollar up-front to go to university and you will not pay it back until you earn over $50,000. We know that those 40 per cent of Australians who get university degrees earn, on average, over 75 per cent more than Australians who do not have a university degree. So their ability to pay back what has been quite a generous contribution from the Commonwealth is greatly enhanced by their university degree and they are going to earn about 75 per cent more than an Australian who does not have that degree—on average, over a million dollars in extra income. It simply means that when you choose to go to a university, the degree that you study will have the best teachers, will be a part of the best institution and will enhance your ability to have a greater income later in life.

The other thing we have done in this reform package—and something that the Labor Party likes to sort of forget—is we have expanded the HECS system for the first time ever to include diplomas, advanced diplomas and the trades. I will start with the diplomas and the advanced diplomas. If you come from a background where people have not gone to university before in your family or if you come from a low-socioeconomic background, often you would not go straight into the university, you would study a diploma or an advanced diploma. For the first time ever, you do not have to pay a dollar up-front to get a diploma or an advanced diploma, which could be your great stepping stone, particularly if you are coming from a disadvantaged background, to get into university. We have made a significant change there.

We said if it is fair enough for people going to university to have this scheme, it should be fair enough for people that are getting a trade. We have said that the hardest part of getting through a trade apprenticeship is often the first few years and we have expanded the system to include trades, so you can now get a $20,000-loan up-front where you do not pay a dollar until you earn over $50,000. It is about creating greater equity for young people who are making choices about what they do with their life. Surely a person who gets a trade deserves the same opportunity as somebody who goes to university.

The other thing we have done in this reform package is radically expand the Commonwealth Scholarship Program so if universities are making greater revenue or charging more for fees because they are offering a better service, some of that money has to be re-invested back into the Commonwealth Scholarship Program, which directly assists people coming from the most disadvantaged backgrounds. We expect that there could be thousands of new scholarships created to ensure that people from the most disadvantaged backgrounds have the opportunity to go to university for the first time, to give them that financial assistance. They will be studying in world class institutions, which is the fundamental principle of this policy. When an Australian student decides to study, they should have the right to study in a world class institution.

I will go through and debunk some of the scare campaign that the Labor Party is trying to put forward.

Mr Brendan O'Connor interjecting—

I notice the shadow minister interjecting so he probably wants to listen to what we have in this funding proposal. The Labor Party likes to say that we are cutting funding. We are actually increasing funding every year for the next four years in universities. There is actually $37 billion in funding for higher education in the next four years. We are also continuing to support regional higher education directly through the regional loading, worth $274 million over the next four years, which will help those people in regional communities get into university and help those regional institutions.

We also think that universities play an important role in research. In the budget there is $150 million in 2015-16 for the National Collaborative Research Infrastructure Strategy to ensure that we can have world-leading research taking place in our universities. The other thing we are doing is providing $139.5 million to deliver 100 new four-year research positions per year. We are putting an enormous amount of money into higher education. Anything to the contrary is factually wrong.

Let us have a look at what Labor did when they were in government. They are running a scare campaign at the moment but they like to quickly forget what they actually did. Labor cut $6.6 billion in funding for higher education. They cut $3 billion in their last year in office alone. They left the university system facing regulation compliance and reporting red tape worth $280 million a year—that is, money that could have been spent on delivering better outcomes for students or on helping students get to university but it was caught up in university bureaucracy.

What I think was the biggest shame when it comes to higher education in the last decade was the former coalition government had set up the Higher Education Endowment Fund, which had, when we left office, $6 billion in it. It was a capital fund that would grow over time. The interest from that fund would give universities sustainable funding for the long term. It was a long-term visionary project that ensured our universities had the funding they deserved. So what did the Labor Party do? They dismantled that fund. We no longer have the Higher Education Endowment Fund with a large amount of money sitting there with interest being incurred to ensure long-term sustainable funding. I think that is the greatest shame in the higher education sector in the last decade.

I think it is important that we get the facts on the table. I am proud to support these reforms because these are reforms that ensure students from the most disadvantaged backgrounds can go to world class institutions, get an education and get a degree that is as good as one that they can expect from the United States, from the United Kingdom or from universities in our region. It will ensure that our higher education system provides a significant export market, helps grow tax collections and revenues to deal with the long-term economic challenges that we face and meets a growing demand as we see over a billion people come into the middle class in Asia.

I am proud to support these reforms and I commend this bill to the House.

See this speech in context