Tony Zappia (Makin, Australian Labor Party, Shadow Parliamentary Secretary for Manufacturing) Share this | Hansard source

This legislation, the VET Student Loans Bill 2016, confirms once again the financial and administrative mismanagement and incompetence of the Turnbull government. This legislation seeks to rectify widespread rorting and unethical practices within the vocational education and training sector and the VET student loans program. Responsibility for the mess rests fairly and squarely with the government. This government has been in office for three years. Claims by members opposite that they are simply fixing up Labor's mess do not stand up to scrutiny. This government has been in office for over three years now, and it is because of this government's mismanagement that we are dealing with this legislation. The VET framework was poorly administered, poorly audited and left unregulated by this government. The government had the ability to deal with it properly. It had the tools to do so but it was asleep at the wheel. The alarm bells should have sounded much, much earlier. They should have sounded when enrolment numbers in certain courses skyrocketed, when hundreds of VET providers appeared out of nowhere, when payments to private registered training organisations, particularly new registered training organisations, also reached ridiculous levels. It is beyond comprehension that the system failed so badly.

Australian Careers Network is one particular case. Its 30 June financial report boasted that its student numbers had increased by 417 per cent, from 4,990 students in 2014 to 25,784 students in 2015. In just one year they went up fivefold. The organisation also boasted about having an average revenue yield per student of $3,303. Careers Australia had payments increase from $3.5 million in 2011 to $108 million in 2014. Evocca College, trading as ACTE Pty Ltd, grew from $24.9 million in 2012 to $131 million in 2014. The number of students accessing VET FEE-HELP loans was projected to increase from 100,000 in 2013 to 225,000 students in 2014-15 by the Department of Education and Training.

Those figures alone should have set the alarm bells ringing, and yet they did not. It took a Senate inquiry to expose the rorting and for the government to in turn act. Indeed, one has only to ask: given the multitude of shonky practices since exposed, just what advice did the government receive about the rorting from its own departments or any other sources? When did it receive such information, if any, and what was the government's response to those warnings? Indeed, why did it take the government so long to act? Nobody will believe that the warning signs and the incidents of rorting were not being reported to the government or to government members, as they were to so many members on this side of the House.

I have listened to government members who have spoken in this debate, and they are clearly in denial about their government's incompetence. Perhaps members opposite were also in denial about the failure of their free market ideology—an ideology that not only failed this government but also failed the students and failed the community. Members opposite are also in denial that the state-run TAFEs and the longstanding industry training organisations are the most trusted and most reliable to deliver vocational education and training. Perhaps members opposite were hoping to see the demise of the TAFE sector. Unlike the Turnbull government, Labor will always back TAFE.

Regrettably, ethical registered training organisations have had to suffer the upheavals caused. Thousands of VET students have been left with VET FEE-HELP debts of thousands of dollars that they were, in many cases, totally unaware of and that they are unlikely to ever repay. I understand that it is estimated that some 40 per cent of the VET debts will never be repaid. The country has been left with billions of dollars of lost revenue that could have gone to much, much more needy causes. This money could have been used to support our health and education services in this country. We have also seen money wasted on courses and degrees that were not fit for purpose, leaving graduates underqualified and with absolutely no job prospects. And, of course, the costs of many of these course were, in many cases, well over market rates. Worst of all, thousands and thousands of students have been left in limbo.

The government is in denial about all of this and is also in denial about the fact that it took a Senate inquiry to publicly expose the rorts. The government's dissenting Senate report—a dissenting report; not the majority report—attempted to lay the blame on the previous Labor government, again trying to point the finger at the Labor government that set up the process many years ago. It was not that the process was at fault; it was the oversight of it. This legislation is now attempting to ensure that there will be proper oversight in the future.

Labor put forward an election policy—a policy which underpins this whole legislation—articulating the way forward by capping student loans; cracking down on brokers; linking publicly funded courses to industry need and skills shortages; linking funding to student progress and completion; and requiring VET providers to re-apply under new standards, so that only high-quality providers could access the loan systems. Government ministers and government MPs ridiculed Labor's proposals and now they find themselves adopting the Labor way forward. Again, it is Labor leading the policy in this area and the government is following—again, another backflip by a government that, if nothing else, has excelled at backflips. Given that this legislation is largely based on Labor proposals, Labor has indicated some support for it—albeit that we have also moved an amendment, which I will be supporting, for a change to some of the wording. Whilst we support the legislation in principle, we are also very critical of the government's management of this whole process to date. I also understand that there may be another Senate inquiry into the legislation, and it will be interesting to see what comes out of that.

Vocational education and training is essential to Australia's economic future. We need skills and trades; nor does every person want a university degree. Indeed, in today's labour market, it is often easier to get employment with a trade or a skill than with a university degree. But the skills training paid for must be affordable and must properly qualify the person for the work they are employed to do. Over the years, no providers have done that better than the nation's TAFE, other public education institutions and the many industry-led not-for-profit training organisations. They know the needs of the industry, know what the skills shortages are and understand the skills required by the various industry sectors. Their futures are now also uncertain. All of those credible and reputable training organisations that have been doing the training for years and years have been caught up in this mess and, for many of them, their futures are uncertain, as the member for Canberra outlined just a moment ago.

I have a TAFE in my electorate. Only last week I was speaking to an employee of that TAFE. The employee asked me, 'Do you know what my future is and what the future is of the TAFE in our region?' This is a TAFE that has served the region well for decades; a TAFE that provides training opportunities to thousands of young people in my state and, in particular, in my area; a TAFE that has provided career pathways to people who did not want to go to university. They no longer know what the future holds for them, because of the undermining of the TAFE system by this government.

I said a moment ago that this legislation essentially picks up on proposals put forward by Labor, and for that reason we will be supporting it in principle. As I also said, I understand that there might be a Senate inquiry. It will be interesting to see what comes out of that Senate inquiry if it proceeds. I have no doubt that, if we consult further on this matter, there will be other issues and other matters that are specifically related to this legislation that might arise and may need to be addressed. One of those matters is the appointment of an ombudsman.

I note that in this legislation there is no provision for the appointment of an ombudsman in this sector. Perhaps some of the problems that we have had to date might not have occurred an ombudsman had been appointed. More importantly, if an ombudsman were appointed, it would provide an office for young people to go to if they run into difficulties with respect to their course. But, of course, that all depends on what powers and what authority the ombudsman has. It would be of little purpose to appoint someone you could take your concerns to if that person had no ability to do anything about those concerns other than perhaps to provide an annual report. So, if an ombudsman is to be appointed to oversee this sector, let us ensure that that person at least has the appropriate powers to deal with the problems that have arisen—the problems that have been exposed over the last three years—which government did nothing about.

It is time we put back on track the skills training authorities of this country, because they are important to the country's future. They provide career paths for many people and they are essential to ensuring that we are a country that is still able to make things, do things and fix things.

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