Nola Marino (Forrest, Liberal Party) Share this | Hansard source

The Higher Education Support Amendment (VET FEE-HELP Reform) Bill 2015 amends the Higher Education Support Act 2003 to strengthen the protections for students in the vocational education and training sector, and to push the unscrupulous training providers out of the market.

VET FEE-HELP—why is it needed? VET FEE-HELP has undergone unanticipated growth since Labor axed the credit-transfer arrangements between VET FEE-HELP-funded qualifications and university qualifications in 2012. Throughout this debate, I have been disappointed to hear Labor members suffer from selective and collective amnesia about the source of this problem that we are seeking to address with this bill. Listening to the Labor members speak, it is really an attempt to rewrite history; pretend that they were not responsible for the dreadful legislation that enabled the rorts and the unconscionable conduct that we have seen in this instance. Much of the growth in this sector has been because of the unscrupulous behaviour of, probably, a minority of providers and agents who aggressively market the scheme, targeting vulnerable people who are left with a significant debt but no benefit from the training itself. This has put a real stain on the quality providers. It is something they certainly feel very greatly. It is a real issue for those young people, especially those who do not achieve any qualification as a result of signing up to a course.

The system under the former Labor government failed to put in place the necessary safeguards for these young people; to protect students, and taxpayers as well, from rorts. Labor failed to do this. Let there be no equivocation on this: Labor failed to do that. They actually had the chance in 2013 when the first complaints—I have heard many statements here about when the government should have acted—were made to the national training regulator, the Australian Skills Quality Authority, but Labor failed to do anything.

Labor's system allowed colleges to sign up students for, often, useless or quick-fix type courses, and to inflate the costs of courses. On 18 September 2015, the shadow minister for higher education, research innovation and industry, Senator Kim Carr, finally acknowledged the need for stronger measures. It took a while. Senator Carr, as reported in The Age, said:

Labor introduced VET FEE-HELP with good intentions but the scheme contains 'fundamental weaknesses' that need to be fixed.

And he said:

… regulators were not given enough power to crack down on rogue operators.

This is the first time that Senator Kim Carr and Labor actually admitted that they had created a problem in the way that they had drafted the legislation for this system.

What we have seen, as has been articulated by others, is that this has been a licence to print money—in some instances, taxpayers' money. A great many young people were affected by this. On 12 March, the Assistant Minister for Education and Training at the time, Senator Simon Birmingham, announced a series of measures to crack down on unscrupulous behaviour—the sort of behaviour that has left some students with debt and absolutely no qualifications. What a disaster.

These measures which seek to stamp out unscrupulous behaviour will assist in restoring integrity in the sector, especially for the good operators, and there are many of those. We want to see the young people end up with the skills and training that they so need for the future. The government has been introducing these measures progressively since April 2015, and they are already having an impact. The bill provides the laws necessary to implement specific measures from 1 January 2016. It should be passed as a priority. It seeks to prevent those inappropriate enrolments and debts by introducing a two-day cooling off period; introducing minimum prerequisites to ensure students can complete the higher level VET courses, for which VFH is available; and requiring a parent's or guardian's signature before a student under 18 can request a VFH loan.

The bill will also further protect students and taxpayers—it is important to protect taxpayers—by making it easier for a student to have their debt cancelled, where they have been signed up for a loan inappropriately; a cost that will be recouped from providers to protect the taxpayers as well as the student. It will introduce minimum registration and trading history requirements for new VFH provider applicants to ensure those approved have a proven history of delivering quality training; introduce infringement notices attached to civil penalties for breaches of the guidelines; and introduce technical amendments to strengthen the department's administration of the scheme, and its partnerships with Australian Quality Skills Authority to monitor and enforce compliance.

There are a raft of measures here. In addition to the reforms introduced by this bill, the government's changes to VET FEE-HELP also include banning inducements for enrolments—we have heard plenty about that—from 1 April; banning withdrawal fees and other barriers to students wishing to withdraw from a course before a debt is incurred; banning inappropriate marketing; making providers responsible for the actions of their agents; and, from 1 January 2016, banning providers from levying the full debt load up-front, regardless of a student's progress through the course. This is achieved in this legislation by requiring training providers to have multiple census dates and proportionate levying of fees across each course. The government provided $18.2 million in the 2015-16 budget for compliance to support these measures. The government has been aware of the problem created by Labor and has been progressively working through trying to fix just another mess. The government consulted widely, as is important, on the implementation of the reforms, including through dedicated forums after the announcement in March.

The government also appointed a VET FEE-HELP reform working group, comprised of representatives of training providers; students—of course, importantly; employers, the ones who have to employ young people and those who take these courses; and consumer law advocates and regulators to advise on the implementation of the reforms, including the measures in this bill.

Labor set up the VET FEE-HELP scheme and expanded access to it in 2012 but, as I said earlier, they simply failed to put in place the necessary safeguards to protect students and taxpayers from its abuse. That is what we are trying to fix tonight with this bill. The first complaints were received by the Department of Education and Training as far back as 2011, yet Labor failed to take any action. They failed to introduce a dedicated compliance regime for the VET FEE-HELP scheme.

The government has committed $5.6 billion this year for VET through funding to the states and territories to support their training systems and TAFE; direct funding for apprenticeships and the Industry Skills Fund; and student loans for VET students. We have also funded up to 250,000 training places funded through the $664 million Industry Skills Fund, which supports businesses to train their workers and provides free, independent skills advice to help businesses take advantage of growth opportunities—great practical initiatives.

We will also provide financial support to almost 80,000 employers this year to help with the costs of employing an apprentice through the Australian Apprenticeships Incentives Program. Again, these are very practical ways of assisting both the employers and the people seeking employment.

The government has invested in very tough new standards for all training providers that started on 1 April 2015, including $68 million to establish the Australian Skills Quality Authority to target poor-quality providers, whilst lifting the red tape burden on consistently high-performing providers—something that is important in the system.

We have developed in conjunction with states and territories a new national training complaints hotline—13 38 73, if you are listening—to make it easier for people to have their complaints about training heard and actioned. And we are supporting the Australian Competition and Consumer Commission's investigation into VET FEE-HELP complaints

By contrast, Labor cut more than one billion dollars from apprenticeships between the 2011-12 budget and the 2013 federal election, including millions of dollars in incentives taken out overnight on the eve of the 2013 election. In the 12 months after Labor discontinued the $1500 standard employer commencement incentive for existing worker apprentice and trainees in non-National Skills Needs List occupations, apprentice and trainee commencements halved from 126,200 in June 2012 before the cut to 61,600 in the June quarter after the cut. The number of apprentices and trainees in training dropped by more than 100,000 over the same period.

Labor failed to deliver appropriate national standards for registered training organisations, failed to properly fund the regulator and failed to protect students and taxpayers from dodgy providers. And tonight we are attempting to clean up some of the dreadful mess that Labor created.

An independent review of Labor's signature Productivity Places Program found it could not be determined—and this is a classic—who had been trained, how many people had been trained and how many had been given the contracts to do the training. What an absolute mess, and even Labor abandoned it before the funding was due to run out.

When I look at the skills that are needed—and each member in this place knows of the opportunities and challenges ahead—I am pleased that we are also trialling innovative P-TECH style models of education in schools to give students an industry supported pathway in science, technology and maths. Our goal is to put industry at the heart of the training system by establishing the Australian Industry and Skills Committee and reforming training package development while, at the same time, abolishing more than a dozen of Labor's bureaucratic skills committees—a committee to have a committees.

We are also cutting the small business company tax rate to the lowest rate in almost 50 years and, for two years, giving all small businesses an immediate tax deduction on any asset they buy costing up to $20,000. This will benefit more than 95 per cent of all Australian businesses, including thousands of small businesses and tradespeople who employ an apprentice.

The government is providing up to $200 million a year for the new Australian Apprenticeship Support Network to provide more help to employers, particularly small business employers, to recruit, train and retain apprentices. The government will support more than 300,000 apprentices a year across more than 420 locations—much more than under Labor's old Apprenticeship Centres.

Our policy targets apprenticeship completions, which hovered at around 50 per cent under Labor. We will do this by providing more financial support to apprentices through Trade Support Loans of up to $20,000, and nearly $30,000 of these Trade Support Loans have been accessed since the program began in July 2014. The loan assists apprentices with the costs of living with the greatest support available in the early years when the apprenticeship wages are at their lowest. This is practical direct encouragement for not only for business but young people seeking training and, again, as I said when I started: we are cleaning up yet another Labor mess with this legislation this evening. I commend the bill to the House.

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