Matt Williams (Hindmarsh, Liberal Party) Share this | Hansard source

I rise to support Education Legislation Amendment (Overseas Debt Recovery) Bill 2015. I am pleased to acknowledge the comments made by the member for Kingston about the Labor Party supporting this bill and noting the savings that this will generate and the fairness involved in this bill—because that is the case.

The Higher Education Loan Program, or HELP, is a wonderful scheme. We all know that education is such an important enabler in community and it helps in many ways. It helps productivity, which is something that we are very focused on. We also know that a more educated workforce is better able to adapt to the challenges that our economy and businesses face on a daily basis. Innovation is one of the key things that education does help out with through the skilling and knowledge it generates. We all know the Prime Minister's background in innovation through OzEmail and other ventures. His experience with OzEmail was as a 16-year-old in a garage, but it ended up as a very successful company. It was based on innovation.

Tertiary education, while not the best avenue for all people, has been a wonderful pathway for a great many Australians. We need to ensure that we develop a system that fosters support and learning for students who can then pay their debt when they are in a position to do so. That is crucial. As former Prime Minister, Paul Keating said:

There is no such thing, of course, as “free” education. Somebody has to pay. In systems with no charges those somebodies are all taxpayers. This is a pretty important point: a “free” higher education system is one paid for by the taxes of all, the majority of whom haven’t had the privilege of a university education.

As he says,

Ask yourself if you think that is a fair thing.

That is why this bill is important. It ensures that the playing field is even and people who receive this service make good on their pledge to pay the money back when they can support themselves.

I have worked for the state government overseas in Europe and I know that there are thousands of Australians over there who work and live in Europe, as they do all around the world. Many of these expat Australians had a debt from their university days, but they were not paying it back. We agree that is not right and fair. There is currently no legal obligation for people with a HELP debt residing overseas, and who are nonresidents for taxation purposes and not required to submit a tax return, to repay their HELP debts. It is estimated that, as a result, between $400 and $800 million in revenue has been foregone since the commencement of the scheme in 1989. We would all agree that that is a significant amount and so this issue needs to be addressed. This bill is addressing it.

This proposal is simply imposing the same HELP repayment obligations on Australians living overseas as currently apply to those who remain in Australia. For example, a banker earning substantial income overseas will be required to repay their HELP debt; however, a backpacker earning little or no income, or earning below the minimum repayment threshold, will not be required to make any repayments. Recovery of overseas debts is already an integral part of student loan schemes operated by a number of other countries around the world, including the UK and New Zealand. This is not something that is new. It has been done successfully by other countries and will now be done successfully by Australia.

It is estimated that these bills will generate savings of more than $25 million between 2015-16 and 2018-19, and more than $150 million over 10 years. From 1 January 2016, all current and new Australians with HELP and TSL debts who move overseas for six months or more will be required to register with the ATO via the myGov website. As I mentioned, other countries have been successful in executing and implementing this sort of process to recover such debts. The UK has advised that around three-quarters of its overseas debtors voluntarily enter into and comply with repayment arrangements. New Zealand has found that, once contacted, its overseas student loan debtors have a compliance rate of around 70 per cent—some good case studies there.

The proposed approach will minimise complexity by placing a strong emphasis on self-compliance. There have been targeted communications to cover off issues that may be raised. The coalition is proposing real reform for the tertiary sector which will help universities perform better, delivering a better service to students who then will be better armed to face the challenges of this century.

In closing, I just want to make the point that the bill will right a wrong that has slipped through the system for a number of years and will ensure that the playing field is even. If you earn $100,000 in Australia, London, New York or wherever, you will have to pay your debt to the government. This bill will ensure that happens. I commend it to the House.

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