Stephen Smith (Perth, Australian Labor Party, Shadow Minister for Education and Training) Share this | Link to this | Hansard source

The Higher Education Legislation Amendment (2007 Budget Measures) Bill 2007 amends the Higher Education Support Act 2003 to provide for the government’s 2007-08 budget commitments, indexation increases and other technical adjustments for the years 2008-10 and adds maximum grant amounts up to the year 2011. The bill includes the higher education measures announced in the budget other than the Higher Education Endowment Fund. The bill covers a range of areas, including reducing the number of Commonwealth Grant Scheme funding clusters; changing CGS funding levels across disciplines; specifying a revised maximum student HECS contribution for commerce, economics and accounting courses; introducing three-year CGS funding arrangements to commence from 2009; lifting the 35 per cent cap limiting the proportion of full-fee domestic undergraduate places and limiting the 25 per cent cap for medical places; increasing the total number of Commonwealth supported places; increasing the number of Commonwealth scholarships from 8,500 to 12,000 per year and allowing them to be paid by the Commonwealth directly to students; introducing an Indigenous scholarship classification for up to 1,000 higher education Indigenous students; providing additional funding to universities to improve teacher education programs; creating a new Diversity and Structural Adjustment Fund for universities through the appropriation of an additional $67 million; and providing additional funding to the Australian Research Council for the period 1 July 2007 to 30 June 2011. In that context, the bill also amends the Australian Research Council Act 2001 to update caps on funding for 2007 and 2008 and adds the financial years starting 1 July 2009 and 1 July 2010. Labor supports these measures and, with a couple of notable exceptions that I will come to in the course of my contribution and make clear by way of second reading and detailed committee stage amendments, supports the bill.

What a surprise that the government’s budget contains measures favourable and positive for education. What a surprise, after 11 long years of neglect and complacency and of deliberate underinvestment in our higher education and university sector. What a surprise, three, four or five months before an election, after Labor has made education and higher education a front and centre policy and political issue for the course of this year. What a surprise that, at the last minute, the government might decide cynically and politically to do something about education. There is only one reason for that occurring—that is, the government is much more interested in trying to save its political neck than it is in a long-term, enduring commitment to education and higher education.

While there is much relating to education in the budget and in this bill, which, as I have indicated, we welcome, it comes after 11 long years of neglect by the Howard government of the education and training of our nation—neglect in building the skills and capacity of our workforce today for the challenges of tomorrow. The essential case against the government when it comes to higher education is that, over the period of its term in office, the government has underinvested in higher education and in our universities. When the government first came to office, it cut funding to higher education by $100 million a year. The government cut funding to technical and further education in TAFE by 13 per cent in its first term of office and increased it by only one per cent in its second term—an effective real cut from the 1995-96 figures. Up until this year’s budget the government actually reduced funding to universities by six per cent per student place between 1995 and 2003. These are facts and analyses that the government would prefer the community to gloss over at this point in the political cycle.

So, given this track record, we should take the budget and this bill with a grain of salt, or perhaps a large dose of cynicism. I think that is how these measures and the budget generally have been met in the community. A lot of the feedback I have had from the community is essentially: ‘These look like reasonable measures. How come it took them 11 long years to get there? Oh, we know. We are three, four, five, six months before an election, and the government is much more interested in saving its political skin than in a long-term, enduring commitment to education and to higher education.’ For the Liberal Party, for the Howard government, for the coalition, if they win the next election that will be the end of education so far as they are concerned because the objective is a political end, a political objective. It is not a long-term, enduring commitment to increasing investment in education at every level. It is not a long-term enduring commitment to raising the standards of the outcome. It is not a long-term, enduring commitment to ensuring that in education at every level we make much greater investments to make ourselves internationally competitive. That is the mark against which we need now to judge ourselves—not the investments we have made in the past, not the investments that might be made state by state or state by territory, but how our investments compare with those of the nations in our region and in the world.

The forward estimates in the budget show that, despite the government’s measures in the budget and in this bill, Commonwealth spending on education as a proportion of GDP is forecast to decline. Commonwealth expenditure on education as a proportion of total government expenditure is forecast, according to the government’s own figures, to decline over the next four years from 7.7 per cent in 2005-06 to 7.4 per cent in 2010-11.

At the beginning of this year the Leader of the Opposition, Mr Rudd, and I announced what became known as our Education Revolution document. That document had a central thesis to it. We all know that education is the one thing which gives the young Australian the chance to get ahead, the chance to maximise potential. In that respect, it has often been viewed as a social policy issue, a matter of equity, a matter of opportunity—and that is right. All those things remain true. Those of us in this parliament who have been the beneficiaries either of Commonwealth scholarships to university or of Whitlam free tertiary education know better than most the opportunity to maximise potential and the opportunity to get ahead that that advantage can bring. The central thesis of the Education Revolution document was that education is now the single most important economic investment that we can make, the single most important economic issue that we confront. To remain a prosperous society, to remain internationally competitive, to go to the next level of productivity, we have to make investing in the skills and education and training of the people in our workforce our highest priority. That applies whether we are talking about early childhood education, primary and secondary schools, vocational educational training, universities, or ongoing professional development. At the conclusion of my remarks I will formally move the following second reading amendment, which summarises those matters:

The second reading amendment both summarises the effect of 10 or 11 long years of Howard government presiding over higher education and also makes some remarks and analysis about the budget measures. A telling analysis is that, when the Howard government came to office, 60 per cent of our universities’ revenue effectively came from the Commonwealth—the Commonwealth government discharging its central obligation to fund higher education and universities adequately and appropriately. That has now fallen to 40 per cent and led to the reliance of universities on other contributions, private contributions—whether from individual students or families by way of a HECS contribution, from full fees paid by domestic or overseas graduates, or from contributions by private benefactors or by state government. Private contributions have increased from 40 per cent to 60 per cent. So there has to be a long-term, enduring commitment to restabilise that imbalance, to have the Commonwealth, the nation state, discharge its central obligation to adequately and appropriately fund higher education and our universities.

Moving to some of the major provisions of the bill, let me deal firstly with the changes to what have become known as the funding clusters under the Commonwealth Grant Scheme, CGS, to universities. The budget reduces from 1 January 2008 the number of clusters funded under the Commonwealth Grant Scheme from 12 to seven. The government argues that it would allow universities more flexibility to allocate places across different disciplines and respond to student and employer demand. Under the changes, the government will increase the CGS funding to the disciplines of mathematics, statistics, allied health, engineering, science, surveying, clinical psychology, education, nursing, social studies, behavioural science, medicine, dentistry and veterinary science. These changes mean that in 2008 CGS funding will deliver increases of $2,729 for maths and statistics; for allied health, $1,889; for engineering, science and surveying, $684; for clinical psychology, $2,729; for education, $109; for nursing, $109; for behavioural science and social studies, $840; and for medicine, dentistry and veterinary science, $1,081.

Labor welcomes these increases. We welcome the increased investment in our universities. It is what we have been crying out for for a long time, and it is what we have been drawing a focus on and attention to in the course of this year in particular, an election year. There is no surprise about the government’s motivation here. It is not a long-term, enduring commitment to these disciplines; it is a long-term, enduring commitment to saving its political neck.

The CGS funding for accounting, administration, economics and commerce will be reduced—or, in the language of the government’s budget papers, adjusted downwards—to the same level of Commonwealth contribution for law. This means the government is cutting CGS funding for accounting, administration, economics and commerce by $1,029 per student place per year.

The government argues that this reflects the commercial nature of these courses and the higher incomes that people who study these courses will likely receive over their working careers. For the universities, of course, it is a reduction in funding—a reduction which the government encourages and, indeed, effectively requires, in practical terms, the universities to recover by a consequential increase in the HECS or the student contribution for students doing those courses of accounting, administration, economics and commerce. That is because, at the same time as reducing the Commonwealth contribution to these courses, the budget measures and this bill move accounting, administration, economics and commerce into the same HECS band as law, medicine, dentistry and veterinary science. This will increase the maximum HECS contribution that students in accounting, administration, economics and commerce may make by $1,216 per student per year.

The government says it will leave the final decision to pass on to students the increased HECS contribution to the individual universities, but we know that, in reality, for the vast bulk of universities, if not all the universities, particularly those universities in outer metropolitan Australia or in rural and regional Australia, they will have no choice. The funding cut of $1,029 per student place in accounting, administration, economics and commerce will be met by a concurrent increase in the student HECS contribution of $1,216.

Experience shows, having regard to the last occasion that the government allowed universities to pass on HECS increases, that we can reasonably expect that the vast majority, if not all, of the universities will move quickly to pass on this increased contribution. I do not hold the universities responsible for that; I hold the government responsible. Accounting, economics and commerce students account for more than 54,000 domestic undergraduate students or approximately 14 per cent of all undergraduate places. Cutting the Commonwealth contribution by $1,029 per student place will leave a real and significant shortfall for many universities.

The government will provide transitional funding for universities in the intervening period when the increased HECS contribution takes place. The fact that the government sees fit to provide transitional funding for reducing the CGS component of accounting, economics and commerce student places while waiting for the HECS increases to cascade through the system underlines and reinforces the fact that, without it, universities would be materially worse off. It also highlights the fact that the assertion by the Minister for Education, Science and Training that the universities are not obliged to pass on the HECS increase to students to meet their funding shortfall is really just a word game and tricky language and does not reflect reality. The reality is that the government’s decision in this area will adversely affect universities and their funding arrangements and adversely affect accounting, economics and commerce students by way of an increased HECS contribution.

This is not something unfamiliar under this government—Commonwealth contribution down, HECS contribution up. Labor remains significantly concerned, as Professor Chapman put it in January this year, that we have now got to the stage with HECS that the burden is now, as Professor Chapman put it, at tipping point. If the architect of the scheme is saying that the contingent loans scheme may well be at tipping point, we may well already have got there. This is one of the reasons why Labor has looked, and continues to look, not at increases in HECS but at reductions in HECS, and particularly targeted reductions in HECS. That is what we have done with our proposal to make it more attractive for young Australians to both study and teach maths and science by reducing the HECS contribution for those students studying maths and science. If those students, upon graduation, embark upon relevant occupations, particularly teaching, there would be a 50 per cent remission for the HECS repayments that they make.

In terms of an adverse impact on our universities, the University of Western Sydney, for instance, has said that it will be made financially worse off as a result of the government’s decision in the accounting and economics area by more than $5 million per year, such is the number of students it has in those relevant disciplines. Indeed, on my most recent count, about 15 universities had already indicated they would increase the HECS contribution.

The second area of the bill that I wish to refer to is the government’s proposal to remove the full-fee cap. Currently, there is a 35 per cent existing cap applied on full-fee undergraduate domestic university places as a general cap, and there is a 25 per cent cap for medical places. The government’s argument here is that universities will still be required to offer Commonwealth funded places prior to offering domestic full-fee places. Labor opposes as a matter of principle full-fee undergraduate domestic places. That has been Labor’s longstanding policy position. In this particular budget and this bill, we also oppose the removal of the cap on domestic full-fee-paying students contained in the budget and in the bill.

There are currently around 17,000 full-fee-paying domestic students in Australia’s universities. Under the government’s decision to lift the cap on domestic full-fee places, we will surely see this number rise over time. Indeed, there are financial incentives for universities to do so. This approach places a higher premium on the size of the chequebook than on the content of the textbook. This is why Labor has made it clear that our policy approach in government will be to phase out full-fee-paying domestic places, commencing on 1 January 2009.

We will, of course, allow those students currently in courses on a full-fee-paying basis to complete those courses, and we have indicated to the universities both in the white paper published in the last quarter of last year and by my subsequent public remarks that we will compensate the universities financially for the phasing out of the full-fee-paying places commencing 1 January 2009. I am in discussions with the universities and the higher education sector about the detailed financial implications which arise from the implementation of this policy and the nature and extent of the compensation to our universities. Labor’s is a philosophical position driven by equity—wanting to give all students a fair and equal opportunity to determine their place at university on merit, not by the size of their chequebook.

When the government first introduced the full-fee-paying arrangements it and the universities indicated that they would not allow more than a five-point disparity between those students who entered a university course on a HECS or a Commonwealth supported basis and a full-fee-paying basis. Regrettably, there was no legislation that enforced that as a requirement. It was said to be a so-called gentleman’s agreement between the government and the universities. Over time we have seen that so-called five per cent gap massively stretch out. There are any number of examples in recent times. The most recent figures I have are 2006 figures. At Deakin University, for a Bachelor of Exercise and Sports Science degree, the gap between a HECS place and a full-fee place is 19.75 points; University of Adelaide, Bachelor of Engineering (Aerospace), a gap of 18 points; University of Sydney, Bachelor of Behavioural Health Science, a gap of 17 points; Deakin University, Bachelor of Nursing, a gap of nearly 15 points; University of Sydney, Bachelor of Education, nearly 15 points; University of Sydney, Bachelor of Arts, nearly 15 points; University of Adelaide, Bachelor of Laws (Combined), 12 points; University of Sydney, Bachelor of Education (Primary), 12 points. So the so-called five-point gentleman’s agreement has long been honoured in the breach. That, of course, underlines one of the equity reasons why Labor is committed to its full-fee-paying phase-out approach.

There is a combined effect in the government’s changes to the cluster funding arrangements and its proposal to remove the cap on full-fee-paying places. In Senate estimates a couple of weeks ago, on 31 May, the Department of Education, Science and Training confirmed what Labor had suspected: that the combination of the removal of the full-fee-paying cap and the changes to the cluster funding arrangements would leave universities in the position, if they so choose, of allocating all of their HECS or Commonwealth supported places to one discipline, leaving other more lucrative disciplines like law or medicine as entirely full-fee-paying places. That is the combined effect and impact of reducing the number of clusters and removing the cap on the number of full-fee degrees. Universities are now free to enrol an entire discipline as a full-fee domestic course use by shifting the number of Commonwealth supported places to other disciplines within that cluster. I think it is very instructive to read and listen to the exchange that took place between Senator Carr and DEST officials at that Senate estimates hearing. Senator Carr asked:

Is it possible for entire disciplines to be transferred to full fee paying programs?

DEST:

It will be possible under the new arrangements for a university to offer a particular course only on a full fee paying basis, provided, as we said earlier, that it offers all of those places that it has been allocated in the broad discipline cluster as Commonwealth supported places first. That rule will continue to apply. Within that, the current rule that applies course by course will no longer apply.

Senator CARR—

... But because the clusters are so broad, is it not possible to transfer places in that cluster, say, from law to economics and then offer the law course at a full fee paying rate?

DEST official:

Theoretically, if it is in the same cluster, yes. ...

So, for example, when you look at the cluster funding arrangements which this bill implements, law and accounting, administration, economics and commerce are now in the same funding cluster and the Commonwealth contribution to those disciplines is $1,674. As I have earlier indicated, we have seen a reduction in the Commonwealth contribution to accounting, administration, economics and commerce places. It is now entirely open to a university, if it so chooses, to allocate all of its law and accounting, economics and commerce places to accounting, economics and commerce, leaving all its law places to be entirely full-fee paying. The same applies in clusters where maths, education and health are combined, and where medicine, dentistry, vet science and agriculture are combined. It is entirely open for a university in some of these lucrative professional areas to leave open all of its places in the lucrative area to full-fee-paying places only.

As I say, combined with the lifting of the cap on full-fee domestic undergraduate places, this now means that a university can utilise all of its HECS undergraduate places allocated to a particular cluster for a single discipline, leaving the university to have entirely full-fee courses in attractive or lucrative courses like law or medicine. This means under the new funding cluster arrangements it will be possible, for example, for a law course to become entirely full-fee-paying if Commonwealth funded places are transferred to commerce or economics, which would also attract a higher Commonwealth contribution. In the long term this is nothing more and nothing less than the government pursuing its longstanding ideological approach of pushing university students onto full-fee-paying courses.

Let me move to student income support. Labor welcomes the government’s decision to increase student income support measures to postgraduate students. Labor welcomes the additional Commonwealth scholarships for low-income students to assist with the education and accommodation costs of attending university. Labor believes that the fact that 2,000 of the new scholarships will be offered to students to study two-year associate degrees as a pathway to full fee degrees is sensible, as is the decision to aim the scholarships at students from regional and rural areas. Offering the scholarships to students at the same time as they are offered a place will mean that the often hard decision of weighing up whether to accept the university place while considering the financial implications of such a decision should be easier. Labor also supports the extension of rental assistance to Austudy recipients aged 25 and over to make it consistent with youth allowance, and Labor supports extending student income support to students enrolled in approved coursework masters programs that lead to professional qualifications.

While Labor welcomes these measures and supports them, it continues to be concerned that not enough is being done for students in the student income support area. The reality is that these measures outlined in the budget apply to a small number of students. It is anticipated that only about 11,000 mature-age students are likely to benefit from extending rental assistance to Austudy recipients. The vice-chancellors’ report released some months ago showed that many of our students are under increasing financial pressure, are being forced to work in any number of part-time jobs and are battling hard to make ends meet. As a consequence they are not able to devote themselves to their studies, nor can they enjoy the whole university experience. That is a serious issue and the government has failed to come to grips with it.

As a general proposition I also believe that historically, in the last quarter of a century, the Commonwealth has underutilised scholarships to assist university students and public policy. Commonwealth scholarships could be used to encourage our best and brightest to study in particular disciplines such as maths, science or engineering. They could also be used to encourage and assist our best and brightest to move from rural and regional Australia to universities that specialise in their chosen areas. Of course, Commonwealth scholarships could also be used to alleviate the financial hardship experienced by those who come from lower socioeconomic or disadvantaged family circumstances.

As I have indicated, Labor obviously welcomes and supports a range of measures in the bill. These have come as a result of the focus and political pressure applied by Labor’s commitments to invest more in education at every level, including the higher education sector. However, for Labor these measures are just the start, not the finish. Labor has a long-term and enduring commitment to investing more at every level. The problem for the Australian community if this government is re-elected is that these measures will be the end not the start, because they are about a political end and a political objective. There is more we need to do as far as universities’ recurrent income is concerned, including questions of indexation now that the cluster funding arrangements are on a three-year cycle. We also need to do much more for universities’ infrastructure, particularly research infrastructure.

As I have indicated, we need to do much more in the area of scholarships and student income support. We must also look closely at our rural and regional universities and address the additional cost and income difficulties they experience when often their less than critical mass is further away from population centres. We continue to need to invest more in student amenities and services, which are now withering and dying on the vine as a result of long-term neglect. Those remarks summarise the second reading amendment that has been circulated in my name. I now formally move the second reading amendment and commend it and the bill to the House. I move—:

·              That all words after “That” be omitted with a view to substituting the following words:

·              “whilst not declining to give the bill a second reading;

Duncan Kerr (Denison, Australian Labor Party) Share this | Link to this | Hansard source

I thank the member for Perth. Is the amendment seconded?

Arch Bevis (Brisbane, Australian Labor Party, Shadow Minister for Homeland Security) Share this | Link to this | Hansard source

I second the amendment and reserve my right to speak at a later time.

David Fawcett (Wakefield, Liberal Party) Share this | Link to this | Hansard source

I rise to address the Higher Education Legislation Amendment (2007 Budget Measures) Bill 2007. I support this bill because it continues the Howard government’s strong investment over the past 11 years in education and, in particular, its work with the education sector to ensure innovation and vision and to find better ways to educate our students and to get better outcomes from the people and facilities that we have to support education in this country. I will go through some of the provisions and measures of the bill and I will then talk about a couple of the specific outcomes that will impact on the electorate of Wakefield, which I have the privilege to represent in this place.

The bill will amend the Higher Education Support Act 2003 to revise the maximum funding amounts in several sections that impact on the Commonwealth Grant Scheme, other grants and particularly Commonwealth scholarships. This has a number of benefits for people, particularly my constituents in Wakefield. Of note, it also amends item 9 of the Higher Education Support Act to provide for the new diversity and structural adjustment fund, which will promote structural reform by universities to support greater specialisation, diversity and responsiveness to local labour market needs. Some $209 million has been allocated specifically to this area. This is an important measure because it will enable universities to be responsive to the world around them and the people who are, at end of the day, a key stakeholder group in that they look to employ the people who go through higher education.

The bill will also revise the Commonwealth Grant Scheme funding clusters and contributions to reflect new funding clusters and amounts announced in the budget. Importantly, the number of funding clusters will be reduced from 12 to seven, which will give universities greater flexibility to move Commonwealth supported places between disciplines in response to student and employer demand. There is no greater example of the need for this than in South Australia, which has seen a growth in the defence industry, mining sector, automotive and components manufacturing sector and a range of other sectors. As a result, the demand for particular courses has increased, and in the past universities have felt some constraint in their ability to offer places. The $557 million that has been allocated for this measure will enable a focus on mathematics, statistics, allied health, engineering, science, clinical psychology, education, nursing, medicine, dentistry and veterinary science, and it is a welcome measure. I will come back to the engineering and veterinary science in particular later in my remarks.

The bill also extends the funding agreement from a yearly basis to a three yearly basis, which will give the higher education sector much greater certainty and ability to plan for the future. This provision takes full effect from 2009, but I welcome to the fact that higher education providers will have the option of entering into these three-year funding agreements from 2008 if they so wish.

As part of the flexibility that the government is seeking to give higher education providers, they will still receive funding for overenrolments of up to five per cent, whereas previously this was limited to one per cent. There will also be no penalties for overenrolments above that amount. The government is seeking to give institutions the maximum flexibility to meet either immediate or future student demand.

The bill amends provisions that restrict a proportion of domestic undergraduate fee-paying places. I note that the unis are required to offer all Commonwealth supported places before full-fee-paying places. There has been a deal of concern shown in the community, fed largely by the opposition, about the impact of full-fee-paying places and that somehow this is going to remove the right or opportunity for other Australian students. The opposition are putting forward some kind of perverse inequity: that we celebrate the great export value and provision of international education in Australia and that we welcome and actively promote our education institutions to people from other countries, yet the opposition would deny that same right to Australian students. It is important to look at the context in which this is happening and at the fact that, unlike in 1992—when the number of people who were eligible to go to university but were unable to obtain a place peaked at around 100,000—at the moment that number is at a record low. So we are seeing access increasing. With the 2,300 additional Commonwealth supported places, you can see that every effort—successful effort—is being made by the Commonwealth to ensure that those who wish to study in a supported place have the opportunity to do so. At the same time, we provide the choice to Australians to have the same rights as people from overseas if they wish to take up a full-fee-paying domestic place at university.

The bill will enable the expansion of the number of Commonwealth scholarships. I welcome the fact that at a cost of some $91.4 million over the next four years the number of scholarships will increase from 8,500 per year to 12,000 per year. Two thousand of these scholarships will be available to students who may not otherwise qualify for a higher education place to study a two-year associate degree as a pathway to a full degree. The bill provides funding for an additional 700 Commonwealth education costs scholarships and 210 Commonwealth accommodation scholarships for Indigenous students undertaking higher education enabling courses. The Commonwealth scholarships program will also be expanded to include a one-off payment of $4,000 to eligible Indigenous students to assist with the cost of attending university, as well as up to 1,000 higher education students who will be assisted under the Indigenous scholarship program.

Having been part of the House of Representatives Standing Committee on Education and Vocational Training, which last year produced the Top of the Class report, looking at teacher education, I am pleased to see measures in this bill to assist higher education providers who deliver courses in teacher education by providing additional funding for three- and four-year course students to supplement the costs of delivering the practicum component of teacher education, with some $77 million allocated towards this. Feedback from schools, universities and students undertaking teacher training highlighted consistently across the inquiry that quality practicum was invaluable in preparing students. One of the limiting factors was the time frame and resources that could be applied to this. So I very much welcome this measure in the bill.

To go back briefly to the comments on engineering, in South Australia at the moment we are seeing a considerable expansion in the defence industry sector—in land projects, sea projects and the aerospace sector. We are seeing a considerable upskilling at a technical level and also in systems engineering—particularly the air warfare destroyer and the Joint Strike Fighter—where systems integration is a key part of the capability that those platforms will represent.

We are seeing initiatives being taken to increase the availability of training, requiring that universities have the flexibility to offer places that are relevant. So I particularly welcome the funding which is going to encourage universities to provide engineering, science and maths based places. We also need to have the students to go into those places. I mention here the Concept 2 Creation program funded by the Australian government and supported heavily by industry in South Australia such as Tenix, BAE Systems, General Motors Holden and other components suppliers. In this program, industry, in partnership with the Commonwealth, work with local high schools to encourage young people to see what happens in science and engineering so that they are encouraged to take up those subjects. Teachers are provided support so that they are professionally developed and helped in the practical studies and projects they are to give their students. The students have the opportunity to go into the workplaces so that they see where they can end up if they persevere and choose to go down the maths and sciences route. There is no point having places in universities and jobs open for people if the students are not encouraged. I strongly support the Northern Adelaide Advance Manufacturing Industry Group and their Concept 2 Creation program. I look forward to the funding for that program continuing into the future.

It is important to recognise that a number of factors have been talked about here which come back to the strong economy that this Liberal and National coalition government under Mr Howard has run. This has enabled the $5 billion Higher Education Endowment Fund to be established, as well as the record $4 billion put into education in this budget. It builds on the vision that this government has had for education which looks at a number of enabling factors, things like the professional development of teachers and getting agreement across the country for a national curriculum. With a defence background, I look at the very negative impact it has on families when they have to move between states. Children end up with different standards and different approaches to education. I welcome the government’s move to take leadership on the development of a national curriculum.

I welcome this government’s real focus on core learning as opposed to some of the fads that have been put forward. We have seen the outcomes based education that different groups have put forward at times that take away from the real focus on literacy and numeracy—some of those fundamental and enabling learning disciplines. I welcome the fact that the government has matched its vision in these areas with funding—the $2 billion that has gone into the literacy, numeracy and special needs programs; the $1.4 billion that has gone into the disability access sector to make sure people who have disabilities can access education; and the $35.2 million that has gone into science education to boost both the quality of and potential interest in science education.

I note that the opposition, in their amendments to the bill, talk about decreases in Commonwealth funding. The opposition love to talk about tricky politics, but this is a classic example of tricky politics. When they talk about decreased funding, they are talking about a percentage; they are talking about a percentage decrease from 7.7 to 7.4 per cent. If they were honest they would admit that the actual dollar value has increased. Why? Because of the strong economic management of the government, the total pie that is available for carving up has grown. So the real dollar value of investment in education has increased. It is really important to note that. It is also important to note that the strong management of the economy is the thing that is leading to the extra demand for graduates. We do not have to look too far back in Australia’s history to see the time when people who graduated from university struggled to find a job, whereas now there is a strong demand for graduates from universities as well as graduates from technical colleges and for people with trade training. Strong economic management has given this government the ability to pay off debt and, instead of paying $8½ billion a year in interest, to make record investments in our defence capability, not only in terms of people but in terms of equipment. Hence the spending on the defence industry, hence the demand for skills and hence the demand for university graduates.

The creation of jobs has not just occurred in defence. It has also occurred in the automotive and component supplier sectors. I look at the companies that have set up in Wakefield recently. The whole expansion of the Edinburgh Parks precinct is based on strong economic management. That has enabled us to invest billions of dollars into the auto industry to make them internationally competitive and to increase their exports. There is also the mining sector. Small and medium-sized enterprises are producing innovative tooling and equipment to support air-conditioning companies with things like ducting, and there is the manufacture of tile-producing equipment which goes around Australia and overseas. There are a range of areas where this government has not only the vision but also the economic credibility to enable the investment in our workplaces and in our educational institutions.

Before I conclude my remarks I wish to come back to the focus on veterinary training, veterinary science, which was foreshadowed in the budget. As I look around Australia, I note that the University of Sydney, the University of Western Sydney, James Cook University, the University of Queensland, Deakin University, the University of Melbourne, Murdoch University and the University of Western Australia all offer veterinary science courses. Young people in South Australia have no option to study veterinary science in their own state. I am very pleased to be working with the University of Adelaide, who are now the people running the Roseworthy agricultural campus, to look towards a veterinary science course, a veterinary school based at Roseworthy, which is supported by the Australian government.

Roseworthy was Australia’s first agricultural college and it was established in 1883. Over the years it has gained an enviable reputation for dryland farming, animal sciences and other areas such as viticulture. In 1991, the college joined forces with the University of Adelaide’s Faculty of Agricultural and Natural Resource Sciences. It has now become the key campus for research and education in animal production and dryland agriculture. There is a vision for this college to provide a veterinary school which is a postgraduate school, and that will enable people who have completed an undergraduate degree elsewhere or through the University of Adelaide at Roseworthy to undertake veterinary training, particularly in production animals. Rather than adding to what is sometimes considered an oversupply of people working in metropolitan areas with domestic animals, this is going to be very much focused on working with people in the ag sector who need support for production animals. But it will include new industries, such as aquaculture, and also allow specialisations into areas like biosecurity. That is a growing area of need as we start facing a number of threats both to agricultural production in this country and to human health.

I welcome the focus in this budget on veterinary science. I particularly draw the attention of the House to the opportunities that this partnership between Roseworthy campus and the University of Adelaide offers in providing not only a national focus with a new concept of a postgraduate course, a national focus on production animals and a national focus on things like biosecurity and aquaculture but also the opportunity for young people in South Australia to be able to have a career path and complete their studies without having to go interstate.

I conclude my remarks in support of the bill by repeating a quote that was given to me at one stage when I worked in the Defence Acquisition Organisation. When talking about visions that people had, I was told, ‘Vision without dollars is hallucination.’ That is a very apt remark as we look at education in this country. This government has had vision and it has matched that vision with an economic credibility that has enabled us to make investments not only in the education sector but also in the environment outside that is creating the demand for jobs and for graduates. Compare that to the opposition of the education unions and the Labor Party to many of the initiatives of this government, whether they relate to technical colleges, reforms to curriculum, the implementation of benchmarks, the focus on core skills such as literacy and numeracy, and the impact on the economy that a union dominated Labor government would have with their pattern bargaining and the other things that would undermine the economic growth that this country has seen. Not only would you not have the vision; you would not have the dollars. Not only has this government shown vision but it has also achieved economic credibility, and that is not a hallucination. Education in this country has a strong future with the Howard government. I commend the bill to the House.

Lindsay Tanner (Melbourne, Australian Labor Party, Shadow Minister for Finance) Share this | Link to this | Hansard source

The legislation before the parliament today, the Higher Education Legislation Amendment (2007 Budget Measures) Bill 2007, relates to the implementation of the government’s various budget initiatives in higher education, which were promoted by the government as the primary message arising from the budget—along with the tax cuts—and which constitute a belated attempt on the part of the government to get back in the education game after a very long period of neglect and indeed disdain or contempt for not only investment in education but also the values that underpin the notion of learning. I will deal with the various aspects of the government’s new position in turn and then give some views about what the changes actually entail and what the government’s true position on these issues actually is.

Notwithstanding all of the hoopla about the higher education initiatives in the budget, it is notable that, in spite of everything, the government still could not help itself: it still threw in yet another impost on students. It imposed another burden on students who are already groaning under the costs of trying to make ends meet—trying to ensure that they can both study and have a basic living—and worrying about the debt that most of them carry into their working lives as a result of the huge increase in HECS over the period of time that the Howard government has been in office.

Things have changed a great deal since I was a student in the latter part of the seventies and in the early eighties. I, along with a number of others in this House, was fortunate to study at Melbourne university in a period when there were no fees. I lived a pretty basic lifestyle—as many students then did and do now—but at least I had the knowledge that I did not have to incur a huge debt with respect to tuition fees, as most students do now through HECS. It is also worth noting that a whole lot of changes have occurred in our society since that time which have made it harder for students to get by while they are studying. It has now become very widespread for students to have to have substantial outside employment while also receiving the very limited amounts of student assistance that a proportion of students qualify for. That in turn is being undermined by Work Choices, because much of that employment is in industries like retail and hospitality, which in the last year or so have seen wages fall behind inflation because of the impact of Work Choices on people who are in economically less powerful occupations. Students have to juggle the commitments that they have with respect to earning a living and being able to pay the rent and feed and clothe themselves with the need to attend lectures and to undertake all of the activities that are necessary in order to study for a degree in whatever the discipline might be. At the same time, the incentive to do this is being slowly eroded by the Howard government imposing more and more of a burden on students in the form of a HECS debt.

It is true to say that HECS was invented by a Labor government. It was invented in order to help finance a massive expansion in higher education—which it did. It was originally set at about $2,500 per year across the board for all degrees but, since the Howard government have been in office, it has been changed to a differentiated table of classes of HECS and it is now up to about $7,000 or $8,000 per year for some categories of student. In this budget, the government added to the top level students studying business, accounting and commerce. So even though this budget was portrayed as the Howard government’s big move in higher education and their big attempt to get back into the university game after years of neglect, years of underfunding and years of interference, they still could not help themselves—imposing yet another burden on students and further undermining the incentive for young people to get a degree and to develop the skills and higher learning that are so important to the future contribution that they will be able to make to Australia’s economy.

The second thing that the budget entailed with regard to higher education was, of course, the removal of the cap on the capacity of universities to offer full-fee places to students. There is a very simplistic argument that is put forward in favour of this, which is that, as universities are able to in effect sell places at market value or quasi market value to foreign students, they should be able to do the same thing with respect to Australian students. The obvious fallacy in this argument is, of course, that Australian students—or, more particularly, their families—have already paid for a substantial proportion of the cost of their university education through taxes, which foreign students, by and large, have not done. The underlying rationale for this is to slowly marketise the higher education system and to change the core indicator of access from one of merit, equity and capacity to one of money.

There is a simple underlying factor here that cannot be avoided. The rationale is very straightforward for the Howard government’s introduction of full-fee places and its more recent removal of the cap, and that is to change our higher education system from one where access has been determined according to merit and ability to one where access is determined according to how much money you have got. There is already substantial evidence in a number of institutions where students are getting into courses courtesy of being able to pay the full fees with HSC scores significantly lower than competing students who are not able to pay those fees. Removing the cap will accelerate the process of the shift in the underlying dynamic in higher education in this country, where money will gradually become everything, where those who lack the financial resources to pay full fees will bit by bit be squeezed out and where the ratio between full-fee places and HECS places will gradually shift even further.

The third element of the government’s higher education budget was, of course, the Higher Education Endowment Fund. The Treasurer trumpeted that this was possibly the greatest achievement in the history of the human race in the area of education—although I am perhaps not doing justice to the floridness of his rhetoric. He was certainly very keen to demonstrate that he had managed to produce this extraordinary achievement of earth-shattering significance. Labor support the Higher Education Endowment Fund, but we do so with a couple of observations. One is that there is a great deal less to this proposal than meets the eye. It is a modest but useful contribution to the cause of higher education in this country. To put it in perspective, with its current endowment of $5 billion the fund will deliver approximately $300 million per annum of additional funding to the higher education sector in this country, which works out to be about $8 million per year per institution. That is helpful but hardly an education revolution. It is worth adding to this observation that this is on the assumption that there is no displacement effect—that the $300 million per year will genuinely be additional to government funding and that it will not, in effect, be eroded indirectly by gradual reduction of direct government funding. That, of course, is yet to be seen. Given the track record of the Howard government in higher education, you will not be surprised to hear, Madam Deputy Speaker Corcoran, that, in my view, if the Howard government is re-elected, over time that effective net contribution will be eroded.

It is also worth raising the question of the future decision making associated with the allocation of these moneys, which is still unclear. The concern that I have, and I am sure many others have, is that the government will set up a funding process which will gradually shift the choices about how this public money is allocated into private or unaccountable hands. There is a core question here, with respect to the distribution of the dollars that will be earned by the Higher Education Endowment Fund, as to precisely what degree of accountability will prevail regarding the distribution of those funds—regarding the decisions, the choices, which institutions will get what amounts of money and what those moneys will be used for. I cannot resist the temptation to comment on the astonishing hypocrisy of the government in putting forward this proposal within weeks of savagely criticising Labor for proposing to use $2.7 billion worth of Telstra shares currently held in the Future Fund to finance the creation of a national broadband network—something which, amongst other things, is important for the advancement of higher education in this country.

We all remember the Treasurer going red in the face, frothing at the mouth, screaming, ranting and doing double backflips at the dispatch box when talking about Labor’s proposal. In his terms, this was vandalism, piracy, robbery and all of the other nouns that he frothed out at the time. Within weeks of that florid performance, the Treasurer has in effect done the same thing by denying the Future Fund $5 billion from the 2006-07 surplus that was otherwise promised, by him and by the finance minister, to the Future Fund to set up a separate fund for a different purpose. He has done exactly what Labor was proposing to do, and continues to propose to do, but with almost double the money. We do not quibble with the purpose, but this confirms our assessment, made several months ago, that the Future Fund was going to hit its 2020 full funding of public sector superannuation liabilities well ahead of target and that it could easily afford the small contribution to be invested in a national broadband network. Our assessment of that has been dramatically confirmed by this decision of the government.

Finally, there is an aspect of the government’s position regarding higher education which was announced around the time of the budget but was not dealt with specifically during the budget process. That is, of course, its intention to seek to remove the regulatory responsibilities that the state governments currently have regarding higher education. Most universities are, in some form or other, creatures of state acts of parliament, governed by state legislation and regulated by the states. Of course, under Sir Robert Menzies they became fully federally funded, and so the states have no direct major financial role with respect to universities, but they still have a substantial regulatory role. It is interesting and, I think, highly significant in the context of other initiatives that have been pursued in the budget by the government that this initiative would be pursued at that time. No doubt we will return to that in due course. It is an indication of where things are heading in higher education under the Howard government, and there are two parallel tracks. They are essentially these: reducing funding and increasing interference. Basically what the Howard government is doing is steadily increasing its power with respect to how higher education functions in our society at the same time as its proportional funding is steadily reducing. For example, I understand that Melbourne university—my old university—has only about 15 per cent of its income from the Commonwealth. That is probably at the low end of all universities, but certainly it is an indication of where things are heading.

So there is no question about where things are going on the funding side but, on the interference side, we have seen over time the overturning of Australian Research Council decisions, interference on the question of industrial relations, attempts to impose AWAs on higher education institutions, the abolition of compulsory student unionism, the imposition of a whole range of voluntary student unionism rules on universities—irrespective of their own views—and, of course, the current education minister demanding of the states that they make financial contributions to the university sector.

Within months we have seen the Howard government say to the state governments: ‘We want you to start giving money to universities, to contribute financially to universities’—when it was a federal Liberal government that established virtually universal federal funding for universities many years ago, and governments of both persuasions have maintained it since that time. We have seen the Minister for Education, Science and Training demand that the states contribute financially and, within months of that, she is now demanding that they hand over their regulatory powers to the Commonwealth. There is a clear pattern here of the Howard government seeking to assert more control and spend less money. Others have to pay; students have to pay, the private sector has to contribute more, full fee-paying students have to contribute more, now the states have to contribute more, but at the same time as the Howard government is seeking to withdraw its responsibility on the financial front. It is seeking to interfere at an ever-increasing and ever-escalating level in what universities do and how they are governed.

That is not coincidental, because there is a deep antipathy to learning in the Howard government, and it runs right across the entire spectrum. There is a deep antipathy to learning, particularly to university learning, in the Howard government. The Prime Minister has made an art form of pandering to anti-learning prejudice in the Australian community. The former Minister for Education, Science and Training, now the Minister for Defence, followed in his footsteps, as you would expect. We all remember his hokey little stories about the mythical woman that he used to bump into outside universities in various parts of the country who would tell him about how it was her taxes that were paying the costs of the students studying in those universities and how she had never been to a university and wasn’t it all so important that those taxes be well spent. And we remember his dog-whistling messages that basically said, ‘We all know the kind of rubbish that goes on in universities and that good, honest citizens who left school in form 3, who are paying the taxes to maintain universities, ought to be outraged.’ We have all seen and heard those messages, and the tragedy is that they undermine the wider commitment to learning in our community, not just with respect to the universities but with respect to all learning, whether it is kids staying at school or young people going to TAFE, doing apprenticeships or going to university. The messages that have been coming out from the Howard government on learning have essentially been a negative set of messages, all designed to pander, for political reasons, to underlying prejudice in sections of the Australian community.

I remind the House that in 1989, after the Prime Minister lost the leadership of the Liberal Party, his successor, Andrew Peacock, offered him the shadow ministry for education and he declined it, on the grounds that it was not important enough. He declined that shadow ministry because, in his view, education was not a significantly important portfolio at the national level for somebody such as himself. In recent years he has made statements indicating that he has no problems with young people leaving school early—that is fine. We have heard his former education minister, without any quibble from him, indicate that he believes that creationism should be taught in schools. We have heard the current Minister for Education, Science and Training indicate that, in her view, Maoists are in charge of school curriculums. When the member for Fraser stood up at the dispatch box to ask a question in the House recently, the Prime Minister leaned over the dispatch box and called out—quite tellingly, I thought—‘Here’s the professor!’ It is an interesting indication of the Prime Minister’s attitudes that he regards the term ‘professor’ as a term of denigration, a term of abuse. It illustrates the point that I am making, which is that deep in the DNA of the Howard government is an antagonism to learning, an antagonism to universities and a disdain for the whole concept of people acquiring more knowledge, more judgement and more wisdom and being able to contribute better to society.

This mentality has deep roots in conservatism. It ultimately goes back to the not so good old days of serfs and toffs, when the lower classes were expected to know their place—they had a particular contribution to make in our community, but bettering themselves through learning, acquiring more knowledge and more skills to be able to improve their contribution to society very definitely was not part of it. It is nothing particularly unusual on the conservative side of politics, but I should add in all fairness that it would be wrong to say that this is necessarily always typical of conservative politics. I would be the first to acknowledge that in terms of advancing the cause of learning in this country over the 100 or so years that we have existed as a nation, there are two politicians who stand out for many as people who have made the strongest contribution, and they are Sir Robert Menzies and Gough Whitlam. These two people, one from the conservative side of politics and one from Labor, have, in different ways, contributed most to elevating Australia’s universities and our commitment to learning as a nation. There have been plenty of occasions when conservative governments and politicians have had a serious and genuine commitment to learning. Sadly, the last 11 years of history in modern Australia have not been one of those occasions.

Finally I observe that now, more than ever, it is crucial for Australia to be committed to learning, because of the obvious fact that structural changes in our economy are shifting the balance between low-skilled or unskilled labour on the one hand and skilled labour on the other, and more and more we need people with skills to ensure that we remain a First World nation, a nation with high living standards, able to exploit the opportunities that we have been fortunate enough to enjoy. It is crucial that we maintain and enhance our commitment to learning. I do not have the confidence that the government will be able to do that, because I do not think they believe in it. They are anti learning. They undermine learning. They send out political messages, for their own short-term political ends, that are designed to denigrate learning. (Time expired)

Andrew Southcott (Boothby, Liberal Party) Share this | Link to this | Hansard source

I am pleased to speak on the Higher Education Legislation Amendment (2007 Budget Measures) Bill 2007. The education measures were really the centrepiece of this year’s budget. I was very pleased on the Friday after the budget to be able to accompany the federal Minister for Education, Science and Training on visits to Flinders University, in my electorate, and the University of Adelaide, of which both she and I are graduates. As you would expect from a good education minister, she went with cheques and money and was well received by the vice-chancellors and chancellors and those acting for them.

In 2002 the then education minister announced that a review of higher education policy would take place over the remainder of that year. That was the Crossroads review. From that review came the higher education package Backing Australia’s Future, which was announced in the 2003 budget. With this year’s budget we are building on those measures. We need a higher education system which does a whole lot of things. We need to have some places which are focused on research and some which are focused on teaching. We need to have universities which are very much focused on preparing people for the workforce. The important thing in all of this is that we have a lot of choice and we encourage institutions to go for excellence as well. We need an education system that will deliver the workforce that Australia needs for our future prosperity. It is essential that we have a flexible system in which there is a lot of choice and which is responsive to the needs of students and employers, not one with numerous caps.

In the budget, one of the key things was the new $5 billion Higher Education Endowment Fund for Australian universities. There was also a $700 tuition voucher for children in our schools who do not achieve national literacy and numeracy benchmarks in years 3, 5 and 7. There are bonuses of up to $50,000 for schools that make significant improvements in literacy and numeracy. I have seen some remarkable results in schools in my electorate. Some of the schools use the Jolly Phonics program and swear by it. What you find is that things like this are driven by the leadership of the principal and a real commitment to improving results. I remember when we first wanted national literacy and numeracy tests that this was opposed by the Australian Education Union and, as a consequence, opposed by the Labor Party. It is very important to know how our students are doing and where our students are failing. But it is also important to encourage those teachers who are trying to lift people up and improve their performance. The budget also has a $5,000 bonus for teachers who undertake professional training at newly established summer schools. There will be a payment of $1,000 for first- and second-year apprentices, as well as a $500 voucher to help pay course fees. There will also be three new technical colleges, adding to the 25 already in place.

Returning to the Higher Education Endowment Fund, when you look at universities around the world, you see that Harvard University had an endowment of $US25.9 billion in 2005. They are the best endowed university in the world. Yale had $US15.2 billion. Other universities in the United States, such as Stanford, Texas and Princeton, all have endowments greater than $US10 billion. The University of Cambridge, which has been going for 800 years or thereabouts, has an endowment equivalent to $1.5 billion and college endowments of $5 billion. When we look at the Australian universities—which have not been going as long as Harvard or Cambridge—the greatest endowment any Australian university has is the University of Melbourne’s $800 million. The University of Sydney has $700 million. The University of Western Australia has a very good endowment. But a lot of universities do not have access to this level of endowment. The previous speaker mentioned the great expansion of universities under the Menzies government. A lot of those universities established in the 1950s and 1960s have not been the beneficiaries of bequests. Flinders University, which is central to my electorate, has an endowment of only $10 million. With the Higher Education Endowment Fund, universities will now have access to an endowment fund which, across Australia, is equivalent to what Cambridge University has—although it is still dwarfed by the top five American universities.

As well as providing an endowment worth $5 billion in an arrangement like the Future Fund, it is essential that we encourage a culture of individual and corporate philanthropy similar to that in the United States. There is a hope that we will get, on top of the $5 billion that we have contributed to the fund, more money contributed from businesses and individuals. There is provision for that. When we talk about corporate philanthropy, one of the great examples that I am fond of using is the Santos School of Petroleum Engineering at the University of Adelaide. It was announced in 2001 and at the time was the largest example of corporate philanthropy in the university sector. It was a great gift from Santos. It helped address a workforce need that they had, but it is a school that is for petroleum engineering and it benefits not just that one company.

The budget builds on a number of things that we have already achieved. In the electorate of Boothby, Flinders University recently received $2.5 million towards the cost of a new building for the faculty of health sciences, through the higher education Capital Development Pool program. The CDP program supports proposals that assist in new campus developments in suburban growth corridors and regional centres. There has been almost $94 million allocated to Australian universities in additional funding from the CDP.

Flinders University also received $2.6 million from the Australian government to expand its popular fitness centre, through the $58 million voluntary student unionism transition fund. This was one of 37 projects across Australian universities that have benefited from this fund. Most of the universities which benefited from this fund were regional universities, but Flinders University put up a very good case for why their fitness centre—which is well patronised—should be able to expand. This has been a win-win for university students. What they have been able to do is enjoy the facilities that the doomsayers tried to make us believe would disappear, but at the same time university students have more money in their pockets every year to spend as they choose. They no longer have to pay compulsory student union fees.

I take this opportunity to note that the Labor Party and their shadow spokesman have said that the Labor Party will not reintroduce compulsory union fees, so compulsory union fees are now a thing of the past. The university unions are going forward. They are delivering services, but they are now focusing on their core business and not spending money as they used to on political campaigns. There has also been more funding at Flinders University, with $2.8 million for various life projects in October 2006. This included a fauna study, a project on hearing loss and English as a second language, a child and trauma memory project and a blood lactose monitor project. There was a $2 million Australian government grant in December 2005 towards the construction of a science innovation learning centre to support industry focused group projects in innovation and enterprise and to be a site for the demonstration and promotion of science and technology.

The initiatives in the budget reshape the higher education landscape. One of the problems with the Dawkins reforms is that they made all our higher education institutions universities—they did not focus enough on the important, different roles they all played. Our vision for the future—and we now have this—is to allow more world-class universities to emerge in Australia to encourage excellence and diversity and to allow greater scope for universities to adjust to student numbers, to respond to student demand, to address skills needs, to give more support for structural reform where required, to address the capacity of universities to meet local labour market needs and, of course, to improve learning and teaching standards.

There are several measures in this bill which will help achieve that. There is a $209 million Diversity and Structural Adjustment Fund. There is also a revision of the Commonwealth Grant Scheme, which will be directed towards the disciplines of mathematics and statistics, allied health, engineering, science and surveying, clinical psychology, education, nursing, behavioural science and social science and medicine, dentistry and veterinary science. Student contribution rates are based on graduates’ potential earnings, and the government’s decision has always been based on this. Thus, reflecting the higher salaries that graduates expect to receive over a lifetime, the maximum student contribution for accounting, administration, economics and commerce disciplines will be aligned with law. It is the decision of each individual university whether to raise the student contribution for these courses.

There is no doubt that higher education providers and students will gain from the increased flexibility. By receiving additional funding for some disciplines they will be able to respond more quickly to student and employer demand that will help them address skills shortages. Students will benefit from additional funding as the quality of courses will be improved via smaller classes, better course delivery and materials and equipment. This bill will also allow for the relaxation of caps on Commonwealth supported places and domestic full-fee-paying undergraduate student places. Instead of penalising universities for overenrolments, universities will now be fully funded for overenrolments up to five per cent in Commonwealth support places—up from the current one per cent. Additionally, the amendments will remove penalties for overenrolments above five per cent. Higher education providers will now receive the full amount of the student contribution for all the Commonwealth supported students they enrol.

A productive education system is critical to building the future prosperity of Australia. We need an education system that is responsive to the needs of students and employers, increases skills and boosts productivity and increases the quality of teaching in the major disciplines of literacy and numeracy, English, maths, science and Australian history. The bill also removes the cap on the number of full-fee-paying places universities can offer, which until now has been capped at 35 per cent. Universities, however, will still be required to offer their Commonwealth funded places before offering full-fee places. The ALP may call full-fee-paying students queue jumping by rich students, but we call it giving young people the opportunity to attend university. Labor fears of an education system being flooded with wealthy students are nothing more than another blatant scare campaign. The University of Adelaide Vice-Chancellor James McWha said, ‘I wouldn’t expect it to change by more than one per cent over the next two to three years.’

An additional question that is raised while debating this legislation is: how do Labor propose to compensate universities after they ban full-fee-paying students? A ban would leave the ALP with a compensation bill of $500 million for higher education providers, and that does not include private universities Bond and Notre Dame or postgraduate places. If the ALP propose to ban all full-fee-paying students, they will need to guarantee all universities will not be worse off. The University of Sydney’s Vice-Chancellor, Gavin Brown, said:

·              I am saddened that, for ideological reasons, thousands of students would be denied educational opportunities of their choice.

The budget is a vision for the future of an education system that encourages excellence and that has the flexibility to provide the workforce that Australia will need in the future if we are to see our economy in the future perform as well as it is currently. The Australian government investment in higher education has increased 31 per cent in real terms over the last 12 years. The budget provides $1.9 billion for higher education plus, as I said, an additional investment of $5 billion in a perpetual Higher Education Endowment Fund. The Australian Vice-Chancellors Committee president, Professor Gerard Sutton, said the budget was ‘spectacular’ for the higher education sector. The government’s education blueprint for the future removes red tape and the constraint on flexibility. The number of those who want a place at university but cannot get one is at historically low levels. The policy on full funding overenrolments up to five per cent will effectively mean every student who wants a university place next year will be able to get one.

In my electorate are Flinders University and also the Waite Institute of the University of Adelaide. Both are excellent facilities. They will benefit from being able to access the Higher Education Endowment Fund and they may benefit from some of the increased flexibility that is now there, including the removal of the cap on full fee-paying places. As I said, we have recently made a number of funding announcements at Flinders University—$2.5 million for a sports centre and $2.6 million for a health sciences building. Similarly, at the Waite Institute we have recently announced money for the Australian Centre for Plant Functional Genomics and are working towards getting some Commonwealth money for the Wine Innovation Cluster, which is a very impressive facility. I support and commend the education minister for these budget measures.

Craig Emerson (Rankin, Australian Labor Party, Shadow Minister for Service Economy, Small Business and Independent Contractors) Share this | Link to this | Hansard source

There is much to support in the Higher Education Legislation Amendment (2007 Budget Measures) Bill 2007, and Labor will support a significant number of the measures that are contained within it. In particular, we will be supporting the reduction in the number of Commonwealth Grant Scheme funding clusters because the government has argued that it will give universities greater flexibility in their capacity to allocate funds across courses. As you will see from what I have to say, I am a great supporter of extra flexibility in the university system.

The legislation also introduces three-year Commonwealth Grant Scheme funding arrangements to commence from 2009. It increases the total number of Commonwealth supported places. That certainly is a welcome measure, belated though it is. It and a number of the other provisions in this legislation are a response to Labor spending a great many hours in the parliament and outside arguing that our universities are underfunded and that there are not sufficient places for Australian undergraduate students. This is a matter to which I will return in a moment. The legislation also increases the number of Commonwealth scholarships from 8,500 to 12,000 a year and allows them to be paid by the Commonwealth directly to students. Again, Labor strongly supports the increase in the number of Commonwealth scholarships. The legislation introduces an Indigenous scholarship classification for up to 1,000 higher education Indigenous students. That is a beaut measure, and we certainly support that.

The legislation also allocates additional funding to universities to improve teacher education programs. It creates a new diversity and structural adjustment fund for universities, including the appropriation of an extra $67 million. Further, the legislation provides additional funding to the Australian Research Council for the period from 1 July 2007 to 30 June 2011. There are within this legislation substantial increases in support for higher education in Australia. Labor welcome that. We also welcome a provision that is related but is not in this piece of legislation—that is, the creation of a Higher Education Endowment Fund of $5 billion initially with extra funding from future surpluses going into that fund. That is a good measure.

But all of this is to be seen in the context of the Prime Minister of 11 years questioning Labor’s credentials when we have argued for extra funding for universities in Australia. I will not painstakingly take the parliament through the number of statements that the Prime Minister has made, but in 2005 on the Sunday program he criticised what he called ‘an obsession with increasing year 12 retention rates’ and argued that Australia would have been much better off if a lot more young people had left school early. He said that there was a preoccupation with everyone having to go to university, and not everyone does have to go to university.

In a literal sense, that is clearly true. But it is also true that Labor in government made a concerted and sustained effort to increase the number of young people who did go to university because we thought that it was very much in their interests and in the interests of this great country. The Prime Minister has been bemused at that. He has criticised it. We have had the former education minister, now the defence minister, on many occasions accusing Labor of snobbery in arguing the case for more young people to go to university and to have some relief from HECS. He thinks that that is elitist. He thinks that Labor MPs are snobs in arguing for that. It bemused me that here was a man who got a full university education; he did not choose to leave school early. He went on to become a doctor of medicine but thought it was very snobbish of Labor to suggest that others might do the same thing or undertake other university courses.

It has been a very disappointing debate over the last 11 years, but Labor has stuck to its guns and, at least in a significant part as a result of that pressure, the government has understood that in the most basic political sense it was vulnerable in the area of higher education. And that is when the government does react. It tends to react in election years. It reacts to political pressure rather than having a view about the nation’s future and the importance of investing in it. What better investment could we make than investing in the talents of our young people? When we talk about nation building, from the 1940s and 1950s right through to the current period, we talk about building bridges, roads and railways. What about building stronger communities and building the creative talents of our young people through extra investment in higher education? Is this not the new nation-building agenda, where we agree across the parliament and across the political spectrum that the greatest investment of all must be the investment in the talents and creativity of our young people?

There is much to support in this legislation. Labor do not support every aspect of the bill, and we do note in the second reading amendment that, as a proportion of total revenue, Commonwealth grants to universities have fallen from 60 per cent of the revenue of the universities at the change of government in 1996 to 40 per cent now, while university revenue derived from private sources of income has increased from 35 per cent to 52 per cent and revenue from fees and charges has increased from 13 per cent to 24 per cent. Those figures reveal that Australia has, in the 11 years of the Howard government, adopted a policy of substituting private contributions to higher education for public contributions. The OECD, in its regular report Education at a glance and in other OECD documents, has pointed out that Australia is arguably the only country—and if not the only country then one of very few countries over the last decade—that has substituted increases in private funding for increases in public funding.

The pacesetting countries have increased both public and private funding for universities, and Australia is one of the few countries that have not done that—in fact it has substituted it. A statistic from the OECD that the education minister does not like and which she challenges is this: over the last decade or so real government spending on tertiary education in Australia has gone backwards by seven per cent, whereas on average across the OECD it has gone forward by 48 per cent. It is quite fascinating that the Treasurer, the education minister and the Prime Minister spend a lot of time in this parliament glowingly citing the OECD—perhaps on matters of industrial relations or economic reform—but, when the OECD produces these stark figures showing an increase across the OECD of 48 per cent in funding for tertiary education but a seven per cent decline in Australia, the education minister cries foul and says that the statistics are wrong. The OECD has been putting forward these statistics, with minor revisions, for a couple of years now, and I would have thought the education minister would have had ample time and opportunity to make her case to the OECD as to why the figures are so wrong and to have them corrected. But the OECD has not corrected them. They tell a very sorry tale about university education in Australia and the lack of this government’s commitment to university education.

Another indicator of the lack of commitment is this fact: over the period of the present coalition government there has been virtually no increase in the number of Australian undergraduate enrolments in universities. There was a very tricky little exercise around Christmas when the education minister managed to convince one of the newspapers that there had been a lift in the last year or so, and in fact there had been, but it was off such a low base. For two years there was a decline in the number of enrolments of Australian undergraduate students. If you allow the numbers to fall it is not so remarkable when they increase again. What the minister did not tell the media at that time was that the most recent figures are virtually unchanged compared to 1996.

At a time when we should be making a massive investment in Australia’s future through higher education, schools, preschools and early childhood development, the government has presided over a situation where there has been virtually no growth in Australian undergraduate enrolments. Instead, our public universities have had to rely much more strongly on overseas full-fee-paying students, and that is why we have a situation where revenues from fees and charges have increased from 13 per cent of university revenue in 1996 to 24 per cent. It is a result of full-fee-paying Australian students, and before it was very substantially the result of foreign full-fee-paying students. That is just the way the government wants it. The government has a view—and this is one of the great dividing lines between the ALP and the coalition—that higher education is essentially a private good. By that I mean that most of the benefits of going to university accrue to the student and not to the wider community and therefore most of the funding should come from the student. That is the government’s philosophical view and Labor does not agree with it. Labor believes more strongly than the government does that there are wide and strong benefits for the rest of the community from young people gaining a university education.

I base that view in part on the work of Richard Florida, whose two books about the creative class argue that the prosperity of nations over the coming decades will be determined more than anything else by the ability of regions and countries to generate, attract and retain creative talent—that is, overwhelmingly university educated people. In these regions wages will be high and creativity and wealth generation will be strong, whereas, in those regions that are unsuccessful in generating, attracting and retaining creative talent, wages will tend to be low and will be lagging behind other parts of the national economy of those countries. Indeed, those countries that are unsuccessful in attracting, retaining and generating creative talent will languish in this great contest of the 21st century, and that contest will be for creative talent around the world. In the 21st century there is no doubt that this contest will be fundamental in determining the prosperity of nations as well as the level of tolerance of nations and parts of nations. It will be a very important contest and it is one that Australia has been very reluctant to participate in, overwhelmingly because the government does not believe in the wider benefits of creativity and imagination in determining not only the prosperity of Australia in the future but also the fairness of our country and the sense of tolerance and compassion that we are able to display.

The particular measures to which I want to refer now include reducing the number of clusters funded under the Commonwealth Grant Scheme from 12 to seven. This would provide more flexibility to allocate places across different disciplines and respond to student and employer demand. As I said at the outset, I am a very strong supporter of greater flexibility in our universities. We are in danger of our public universities—which are becoming increasingly less able to access public funds and are taking on more of the dimension of private universities—being outcompeted by genuinely private universities because, as the total government funding of public universities falls but the regulation around them is not reduced, they will face a competitive disadvantage against private universities, which are less regulated.

So any measures that improve the flexibility of public universities to be able to adapt to changing demand for university places in particular disciplines are to be welcomed. That is why Labor welcomes that particular measure. But, as part of that, Commonwealth Grant Scheme funding for a number of disciplines is actually going to be cut, which will mean increased HECS charges for those disciplines. They are accounting, administration, economics and commerce. To use the government’s Orwellian language, the funding for these will be ‘adjusted downwards’—I think that is a cut—because, again, the government regards these disciplines as displaying much more the features of a private good rather than a public good. I am a trained economist. I think the government is saying that I capture most of the benefit of being a trained economist and the wider community does not. I suspect the Parliamentary Secretary to the Prime Minister, who is in the chamber, might agree with that observation. Nevertheless, it is important that those young people who are training for accounting, administration, economics and commerce not be deterred by higher fees from undertaking those endeavours.

One of the most curious statements that has been made in this parliament—and that really is saying something—was made by the Minister for Education, Science and Training when she said on a couple of occasions that because HECS is repayable out of future income it does not matter if there are increases in HECS because that will not deter students going to university. That is an absurd proposition. It is like saying: so long as you buy a car on hire purchase it does not matter what the price of the car is. So long as you put some bananas on lay-by it does not matter if the price of bananas goes back up to where it was when Cyclone Larry wreaked its devastation on North Queensland because it will be payable out of future income. It is just a crazy proposition. Maybe this is an argument for economics students not being deterred from university—because the minister could use a bit more economic advice. The very idea that simply because a payment will be made out of future income means that it does not matter if HECS charges are increased has to be one of the most remarkable statements since a senator—regrettably on our side of politics, as I understand it—back in the 1970s declared that traditionally most of Australia’s imports have come from overseas. The minister might be in that category with her claim that it does not really matter that HECS charges go up because they come out of future income. There will be deterrence as a result of HECS fee increases. There already has been—we have seen that in the levels of enrolments.

Using the same analysis, the minister has said, ‘Aren’t we’—the government—‘terrific because the level of unmet demand has been reduced to almost zero.’ If the objective of government policy is to eliminate unmet demand in our universities then the government could charge everyone $500,000 or $1 million in fees, because then there would not be any unmet demand; there would be no demand at all. Here we have the minister again saying that the role of government is to eliminate unmet demand. No, Minister. The role of government is to support the university education of our young people. The previous education minister actually told the Australian newspaper that he expected the number of university graduates to fall in Australia over the next decade or so. Such is the attitude!

In the remaining time I have I want to particularly welcome the extra Commonwealth scholarships for low-income students. This is a little bit similar to proposals that have been put recently by Professor Glyn Davis on behalf of the Group of Eight. I will just quickly remind members of parliament that I made such a proposal on 22 September last year when I said:

Students would be funded according to need through a system of Commonwealth scholarships with disadvantaged students receiving extra support.

So the government has picked up some good proposals here. I welcome them. We do not support everything in this legislation but it has come very late and only as a result of political pressure. (Time expired)

Michael Johnson (Ryan, Liberal Party) Share this | Link to this | Hansard source

I am pleased to speak once again in the House of Representatives chamber in the Australian parliament as the federal member for Ryan representing the wonderful and beautiful western suburbs of Brisbane. I continue to have a strong passion in the area of education that this bill, the Higher Education Legislation Amendment (2007 Budget Measures) Bill 2007, is all about. Like so many Australians, I have a very keen interest in the quality of our higher education—not only as a member of the Howard government but also as someone who now sees education with different eyes because I am a new father. For me, looking down the track to when my young son might be eligible for education at a tertiary level, it is very important that he is in a position to enter university if that is his choice and that the quality of his education is first class—indeed, not only first class in this country but world class. So as the federal member for Ryan I want to speak in parliament today on this terrific bill and to commend it very generously.

The Howard government has made some very important changes to the university sector since it was elected in 1996. I think the benefits of those changes have gone unrecognised. I am very proud of what the Howard government has done. It has transformed the way universities operate. It has certainly put emphasis on quality teaching to ensure that students in the university and higher education sector are getting value for their money. In the Ryan electorate the University of Queensland is located at St Lucia. I think it is the premier university in the country. As a graduate of that university I am very proud to continue to lobby for it and to represent it and all the students who graduate from it. The quality of our universities is very important. Professor Ian Frazer, who was the 2006 Australian of the Year, developed his vaccine for cervical cancer from the campus of the University of Queensland. We can all be very proud of him and of that university. I know Queenslanders are very proud of that university. I am very pleased that in the budget the government supported the University of Queensland to the tune of some $100 million to fund the university’s new Diamantina Institute for Cancer, Immunology and Metabolic Medicine, which is headed by Professor Frazer.

Contrary to some of the aspersions cast by the opposition, the Howard government has increased funding to the higher education sector by $2.5 billion in the last decade. This commitment is very worthy and we should be front and centre in promoting this in our electorates and to the people of Australia. It is important that they are made aware of the enormous investment of funds being allocated to universities across the country.

Education is the fourth biggest expenditure item behind social security, health and defence in our annual budget. The government spends $17.7 billion in education, which is clearly an enormous amount of taxpayers’ money, and all taxpayers are entitled to expect that their dollars are fully utilised by those who have stewardship over and administer the university sector. Based on the most up-to-date figures that I am able to get my hands on, that amount represents approximately $4,500 for every Australian currently in primary school, high school and university for this financial year alone. It is a lot of money and it is important that it is spent strategically and wisely in the interests of our students and the entire education sector.

In realising the government’s initiatives, the 2007-08 budget represents additional expenditure totalling $3.5 billion over the next four years, increasing from $534 million in 2007-08 to approximately $970 million in each of the following years. The lion’s share of this extra funding, some 57 per cent, will go to the education sector—24 per cent for schools and 19 per cent for vocational education and training.

This bill will realise our potential in higher education initiatives contained in the 2007-08 budget as announced by the Treasurer. It will revise the maximum funding amounts in accordance with the budget announcements for the Commonwealth Grant Scheme, other grants and Commonwealth scholarships. The Commonwealth Grant Scheme is, of course, a scheme through which the Howard government delivers HECS places across the country. Under the budget initiatives implemented in this bill, some $559.6 million over four years will see the Commonwealth grants structure significantly improved and the funding increased.

Funding will be increased for Commonwealth supported places in mathematics and statistics, allied health, engineering, science and surveying, clinical psychology, education, nursing, behavioural science and social studies, medicine, dentistry and veterinary science. As well as increasing the funding for the 2007-08 budget initiatives, there will also be important changes to provide greater flexibility to universities to allow them to allocate places across different disciplines and to respond faster to the demands of students and the requirements of employers. Some of these important initiatives are streamlining the current 12 funding clusters into seven and providing $223 million over four years to relax the caps on Commonwealth supported places and domestic full-fee-paying undergraduate places.

Under the relaxation of the caps on Commonwealth supported places, universities will now be fully funded rather than penalised for overenrolments of up to five per cent in Commonwealth supported places. This will give universities much-needed leeway in allocating HECS places as well as effectively eliminating unmet demand. Unmet demand is currently estimated to be around 12,000 places. However, the ability of universities to overenrol by five per cent has the potential to make room for an extra 21,000 students. This is an additional 2,244 HECS places in the state of Queensland alone. We are talking about a significant number of students—some 21,000 students—having access to places at universities that they would not otherwise be entitled to. Additionally, while universities will be required to deliver specified Commonwealth supported places in nursing, teaching, medicine and engineering, they will now be allowed to adjust student numbers and course mixes to meet student demand and the needs of employers and the marketplace.

The final measure designed to give universities greater flexibility in tailoring their courses is the much publicised removal of the current 35 per cent cap on domestic full-fee-paying places. I listened to the Labor member for Rankin talking about this and I have never heard so much claptrap in my life, especially from someone who is trained in economics, has a PhD and was an adviser to a former Prime Minister. I find his understanding of this policy quite unusual and, at the end of the day, his and the Labor Party’s position will detrimentally affect thousands of students across the country. He says that students will not have access to places in our universities, notwithstanding that the merit of their academic grades will allow them to enter those universities, given that all full-fee-paying places are available.

Getting rid of the cap on full-fee-paying places was encouraged by the universities. They were in the ridiculous position of turning away students willing to pay for their courses—for example, business courses—while being unable to get enough students into funded places. This policy position from the opposition harms students across the country and impacts directly on their potential to earn a qualification or degree and to have an academic experience that will improve their job and career prospects.

It is fair to say that Labor’s policy is very ideologically driven, whereas the government’s is a nitty-gritty policy that impacts directly in the community amongst our young Australians who are seeking to have a very bright future commensurate with their ambitions, their aspirations and, of course, their talent. I want to quote Professor Gavin Brown, the very distinguished Vice-Chancellor of the University of Sydney. He summed up the situation quite well when he commented on Labor’s policy. He said:

I am saddened that for ideological reasons thousands of students would be denied educational opportunities of their choice.

The minister has of course made it very clear that where a university does not choose to offer additional full-fee-paying places it will have to have already offered all its Commonwealth allocated funded places. There is no inconsistency and no further impact with this policy or with the position that the government holds, so I very strongly commend it to the students across the country who might benefit enormously from having access to these university places. Given that the University of Queensland is in the Ryan electorate, this will be of especial interest to the young students of the high schools of Ryan who will be graduating at the end of this year and looking to get into university. So domestic full-fee-paying places do not in any sense at all rob any domestic students of a Commonwealth place. They are available only once all Commonwealth places in that course have been exhausted, and are above and beyond those places provided by the Commonwealth government.

Another Vice-Chancellor, Ross Milbourne from the University of Technology, predicts that the number of domestic full-fee places might actually fall due to ‘expansion in Commonwealth supported offers and the fact that universities can move Commonwealth supported places to high demand areas’. The University of Queensland’s own Vice-Chancellor Professor John Hay is on the record as saying:

Lifting the cap on full-fee paying Australian students may seem politically audacious, but the levels of demand at present are very low and unlikely to increase for some time.

So there is no detrimental impact whatsoever and this spurious attack by the Labor opposition really shows that they have absolutely no depth at all in policy. Behind the PR, the marketing, the package, the advertising and the pretend fiscal conservative that the opposition leader tries to portray himself as, there is no depth or substance. Behind all that superb five-star Oscar-winning PR campaign, there is absolutely no depth and no substance whatsoever in the federal opposition. And I think that when the time comes the people of Australia will certainly see through the facade of the Labor opposition.

I know that the people of Ryan will take a very strong interest in the policy depth of the opposition. I wonder whether on this occasion they will be sending all their shadow cabinet ministers into the Ryan electorate to campaign for the local Labor member, as they did last time. It might be interesting to note for the House that for the last campaign when one Mark Latham was seeking to be the Prime Minister of this country, half the shadow cabinet of the day came into the federal seat of Ryan to try to campaign for him. What happened? The vote went up in Ryan for the Liberal Party, which is fantastic of course.

In terms of this bill, the Howard government is very keen to ensure that the students of Australia are full recipients of the wonderful economy that we have and the wonderful stewardship of the nation’s economic prosperity. I think that is critical to present to the community because we are in the business of ensuring that the prosperity of the nation does go towards investing in the people of Australia and of course in the generations to come, and education is front and centre in the future of our nation. With the budget the government will provide some $208 million over four years to assist universities to specialise and diversify. This really does complement the Howard government’s previous higher education reforms and further implements the policy to remove the one-size-fits-all model in the sector.

Complementing the Realising Our Potential higher education initiatives in the budget is the very innovative Higher Education Endowment Fund, and I want to comment just briefly on this. The Higher Education Endowment Fund really is very visionary and practical, a policy for the future of this nation. It will stand the young people of Australia tremendously well. The Higher Education Endowment Fund will ensure that a strong, well-resourced higher education sector is in place for the students of tomorrow—$5 million is locked up in the bank to ensure that the students of tomorrow prosper from that.

I want to refer to some comments by the very distinguished JD Story Professor of Public Administration at the University of Queensland, Kenneth Wilshire. I point out that Professor Wilshire chaired the review of the Queensland school curriculum under the Goss Labor government so he is someone with a very fine reputation, respected by both ends of the political spectrum in our country. In last week’s Australian, on 7 June, he described Kevin Rudd’s education revolution as being: ‘about six dot points in search of a rationale’, containing little detail of how the measures would be implemented. He went on:

There’s no guarantee whatsoever just because the state governments are the same political party Mr Rudd is going to get their co-operation ...

Public policy by definition should have content, its rationale, the tool of implementation.

But the ‘education revolution’ has no costing, no delivery mechanism; it needs to be spelt out in far more detail.

He continued, and this is the very significant point here:

I fear Mr Rudd’s creating a noodle federation, with some states referring powers to the commonwealth and some states not.

I could go on. He was making some very salient points and I would commend Professor Kenneth Wilshire’s comments about Rudd’s professed education—

Harry Jenkins (Scullin, Australian Labor Party) Share this | Link to this | Hansard source

Order! The member will refer to the Leader of the Opposition by his title.

Michael Johnson (Ryan, Liberal Party) Share this | Link to this | Hansard source

The Leader of the Opposition has enormous respect for Professor Kenneth Wilshire so he might want to pick up the flow and call Professor Wilshire and see what he has to say. One trillion dollars for a nation of 20 million people—the 13th largest economy in the world—with 0.3 of the world’s population is very significant and I think that the Howard government stands to be commended for its wonderful policies that make a difference in creating prosperity for this country.

I am very proud to say that my electorate of Ryan has 1.8 per cent unemployment. Some 10 years ago that figure stood at some six per cent. When the Howard government came to office there were remarkable changes in the character of our country and the character of our economy to make a difference. One other very significant point that needs to be put forward is that some two million new jobs have been created since 1996. For those who are from the state of Queensland, let me just give you the flavour. That represents 40 Suncorp stadiums full of jobs. The city of Brisbane—

David Hawker (Speaker) Share this | Link to this | Hansard source

Order! It being 2.00 pm, the debate is interrupted in accordance with standing order 97. The debate may be resumed at a later hour and the member will have leave to continue speaking when the debate is resumed.