Tony Pasin (Barker, Liberal Party, Shadow Assistant Minister for Infrastructure and Transport) Share this | Link to this | Hansard source

I rise to speak on the Higher Education Support Amendment (Response to the Australian Universities Accord Interim Report) Bill 2023. Principally, this bill amends the Higher Education Support Act 2023 to allow all Indigenous students living in metropolitan areas to be eligible for Commonwealth supported places in demand-driven higher education courses, which means that CSPs are now uncapped for all Indigenous students living in metropolitan and regional Australia who meet the university entry requirements. It will remove the requirement that students pass 50 per cent of the units they study to remain eligible for a CSP and FEE-HELP assistance, and it will require higher education providers to establish and comply with a student support policy, which includes the power to impose a financial penalty on universities for noncompliance.

The opposition supports this bill, but our support is not unqualified. Our chief concerns are outlined in a second reading amendment, as circulated in the name of the Manager of Opposition Business. 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, the House notes that the bill is deficient in a number of respects including that:

(1) more than 3 million Australians have a HECS debt or other type of student debt under the Higher Education Loan Program (HELP) scheme which increased by a massive 7.1 per cent on 1 June 2023, the highest indexation rate in more than 30 years, as a result of the Government's cost of living crisis and sky-high inflation rate;

(2) by proposing to abolish the Coalition's 50 per cent pass rule, the Government has failed to protect students, at high risk of not completing their course, from accumulating debilitating HECS debts and suffering acute financial hardship;

(3) the Government's reliance on a 'survey' of 27 universities to justify the abolition of the 50 per cent pass rule indicates that the Government has not been able to access the relevant data as to how many students are impacted by this measure, reflecting a poor adherence to evidence-based policy;

(4) in proposing to uncap Commonwealth supported places (CSPs) available to Indigenous students living in metropolitan areas which extends the Coalition's measure to uncap CSPs for Indigenous students living in regional and remote Australia, the Government has not explained how it will hold universities to account for poor completion rates by Indigenous students which currently sees only 26 per cent of Indigenous students complete their undergraduate degree within four years, with 37 per cent of students dropping out during that period;

(5) by reason that the Government is proposing to release a consultation paper on its proposed support-for-students policy, it is clear that the Government has not done its homework on this policy nor determined the basis on which universities would be fined as proposed by the bill;

(6) the bill fails to impose on universities a strong accountability and transparency framework including fair and just access to student refunds and the requirement that universities must publish all relevant course information including out-of-pocket costs, total costs, completion rates, modes of course delivery, and employment outcomes;

(7) the Government needs to be transparent with taxpayers regarding how much its changes to the higher education system will cost and how it will pay for them; and

(8) given its deficiencies, the bill should be referred to the Senate Education and Employment Legislation Committee for inquiry".

I will now deal with the bill in sections, beginning with the so-called Australian Universities Accord. The bill implements priority actions 2 and 3 of the Australian Universities Accord interim report, which require legislation. The government has also announced an additional 34 regional study hubs, building on the coalition's policy. The government has invested $2.7 million over two years, from 2022 to 2023, to deliver the accord through a 12-month review of Australia's higher education system, led by a panel of eminent Australians. The objective of the accord is to devise recommendations and performance targets that will improve the quality, accessibility, affordability and sustainability of higher education in order to achieve long-term security and prosperity for the sector and the nation.

The government recently released the report, Australian Universities Accord interim report, which outlines five priority actions the panel believes require urgent responses:

Extend visible, local access to tertiary education by creating further Regional University Centres … and establish a similar concept for suburban/metropolitan locations.

…   …   …

Cease the 50% pass rule, given its poor equity impacts, and require increased reporting on student progress.

…   …   …

Ensure that all First Nations students are eligible for a funded place at university, by extending demand driven funding to metropolitan First Nations students.

…   …   …

Provide funding certainty, through the extension of the Higher Education Continuity Guarantee into 2024 and 2025, to minimise the risk of unnecessary structural adjustment to the sector. Interim funding arrangements must prioritise the delivery of supports for equity students to accelerate reform towards a high equity, high participation system.…   …   …

Through National Cabinet, immediately engage with state and territory governments and universities to improve university governance, particularly focusing on:

• universities being good employers

• student and staff safety

• membership of governing bodies, including ensuring additional involvement of people with expertise in the business of universities.

The interim report also outlines about 80 discussion items, which will be fleshed out over the next five months. The final report will be released by the end of 2023.

On the 50 per cent pass rule: under the Job-ready Graduates Package in 2020, the coalition introduced a provision which required students to maintain a pass rate of 50 per cent or above for units of study they undertake. Students who have a low completion rate and do not meet this requirement lose eligibility for Commonwealth assistance and must either pay for their course up-front, transfer to another course or withdraw from their studies. The rule commence operation on 1 January 2022. A low completion rate is when a student has a fail rate of more than 50 per cent of the units of study attempted after he or she has attempted eight or more units of study in a bachelor level or higher course—or four or more units in a higher education course lower than a bachelor course. The 50 per cent pass rule was introduced to protect students from accruing massive HECS debts under circumstances where it is highly likely that a student will not complete their course, safeguarding students from racking up a massive HECS debt without any university qualification to show for it.

On the waiver for special circumstances: students who have a low completion rate can avoid losing their CSP under special circumstances, including where students are suffering financial difficulties, illness, a death or serious illness in the family, changes to employment, a natural disaster or any other relevant circumstances.

On the Accord recommendation: according to the interim report, the impact of these measures has disproportionately affected students from First Nations, low socioeconomic status families and other underrepresented or educationally disadvantaged cohorts. Yet the Accord panel placed relatively little focus on the impact of imposing a massive HECS debt on students failing their studies.

The costs of living are skyrocketing under the Albanese government, exacerbated because Labor has no plan to reduce inflation, which is hitting students hard. More than three million Australians have a HECS debt or other type of student debt under the Higher Education Loan Program scheme, which increased by a massive 7.1 per cent on 1 June 2023, the highest indexation rate in more than 30 years, as a result of the Albanese government's cost-of-living crisis and sky-high inflation. By proposing to abolish the coalition's 50 per cent pass rule, the government has failed to protect students at high risk of not completing their course from accumulating debilitating HECS debts and suffering acute financial hardship. Let's not forget that Australians with a HECS debt have seen an average increase in their student debt this year of $1,700. Student debt in total now sits at $75 billion, with a large portion of this not expected to be paid. Students and university graduates are paying a very high price for trusting Labor. For the past decade, the average annual indexation rate under the coalition sat at two per cent. The HECS-HELP indexation rate in 2022, Labor's first year, was 3.7 per cent. This year it has come in at 7.1 per cent. In 2024, Australians are expected to suffer another massive increase in their student loans, forecast to be around six per cent.

In all, more than three million Australians with a HECS debt are facing a 15 per cent or more increase in their loan over three years, which is, quite frankly, frightening. This has become such a serious situation that HECS debt liability is making it harder for young Australians to borrow money and buy a home. Yet Labor has no solution. It's tone-deaf to the cost-of-living crisis so many Australians are facing.

What's also clear is that the proposal to abolish the 50 per cent pass rule is policy on the run. Education Minister Jason Clare has patched together a rudimentary survey of 27 universities, which shows that some 13,000 were impacted by the policy without really understanding how they were impacted. We don't know whether those students went on to do another course, moved to full fee-paying courses or dropped out altogether. It appears the government simply doesn't know how many students were impacted by this measure or for what reason and what happened to those students. Of course, some or all of these 13,000 students may have been saved from incurring a lifetime of crippling debt, protected from failing unit after unit, only to eventually leave university with no qualification and a bucketful of debt. The average amount of student debt is now $24,770 per student, compared with $15,191 a decade ago, while the number of people with debts in excess of $100,000 has also tripled in the past three years. Perhaps they moved to a TAFE course and are now thriving, pursuing their dreams by completing a course better suited to their needs.

So, while the government and some higher education providers argue that the practical effect of these measures has been punitive for students, much more information is required to work out what has been going on. This is why a Senate inquiry into the bill is so important. Of course, it might be possible that some universities that are over their funding cap—meaning the university is not receiving any Commonwealth funding for some students—are very happy to see students lose their places because that will save the university money.

Over many months the opposition has been calling on the government to do much more to hold universities to account and put students first. It is far easier to enrol a student than it is to ensure that student completes a three- or four-year degree. For too long universities have measured their success in terms of enrolment figures, but this must change. What really matters are completion rates, because only students who complete their degrees can derive the benefits those degrees confer in the open employment market. For instance, 41 per cent of students are failing to complete a four-year degree on time, with 21 per cent dropping out.

The opposition has been calling for a strong accountability and transparency framework, including fair and just access to student refunds for deficient courses and the requirement that universities must publish all relevant course information, including out-of-pocket costs, total costs, completion rates, modes of course delivery and employment outcomes. Students deserve to be able to easily access this information so as to make the best decision. This bill fails to deliver these clear minimum requirements.

In this bill the government has proposed new requirements that higher education providers must establish and comply with a student support policy to identify students at risk of not completing their units of study and to provide supports to assist. The bill also proposes that a higher education provider may be fined a penalty of 60 units, which currently equates to $16,500, if it fails to comply with this student support policy. By reason that the government is proposing to release a consultation paper on its proposed support for student policy, it's clear that the government has not done its homework on this policy nor determined the basis on which universities would be fined as proposed by the bill.

The core business of higher education providers is to ensure they are closely tracking student performance and identifying which students are at risk of falling through the cracks. The 50 per cent pass rule is a strong incentive for universities to ensure they are closely managing student performance so that students at risk of failing are either supported to improve their performance or given advance warning of the opportunity to withdraw from a unit, thereby avoiding a low completion rate and the loss of their Commonwealth assistance.

It's astonishing that the government is now proposing to conduct a four-week consultation process on the proposed student support policy, which demonstrates the government does not know what it's doing. While the student support policy framework is a positive step, it remains to be seen whether this requirement will lift completion rates more generally. For example, the requirement cannot stop students simply quitting university before completing their degrees.

The bill also proposes to uncap CSPs at universities for Indigenous students living in metropolitan areas. This provision builds on the policy of the former coalition government to uncap Indigenous CSPs for students living in regional and remote Australia as recommended by the Napthine report. In proposing to uncap CSPs available to Indigenous students living in metropolitan areas, the government has not explained how it will hold universities to account for poor completion rates by Indigenous students, which currently see only 26 per cent of Indigenous students completing their undergraduate degree within four years, with 30 per cent of students dropping out during that period.

We are concerned that the government has not adequately addressed how it will hold universities to account for these students successfully completing their degrees. We are also concerned that the government has not assessed the basis for preferencing Indigenous students in metropolitan areas, as distinct from other equity groups such as students from disadvantaged or low-SES backgrounds. The main risk associated with this amendment is that it will lead to more Indigenous enrolments but will not address the problem of low completion rates for Indigenous students.

There's a high risk that many Indigenous students who fail to complete their course will be left with no qualifications and a massive HECS debt made worse by Labor's cost-of-living crisis. The amendments in part 1 of schedule 1 to the bill to expand eligibility for places in demand-driven higher education courses will mean that the Commonwealth will provide funding on a demand-driven basis for all First Nations students to enrol in bachelor and bachelor honours level courses other than a designated higher education course, currently a course in medicine, at a table A provider as listed in section 16-15 of the HESA.

The coalition delivered record government funding of $115.1 billion in total for universities between 2019 and 2024—$95.2 billion in teaching and learning and $19.8 billion in research. In 2020, the coalition announced the Job-ready Graduates Package, of which there were many elements. The package was about far more than just the amount we pay universities for each course. It included a raft of support packages, including wraparound supports for regional and remote students, additional regional university centres and protections for students where they are not succeeding in study disciplines—the 50 per cent rule. The coalition implemented a number of measures to protect students from accruing large HECS debts. These included the Napthine review, the National Priorities and Industry Linkage Fund, and the Indigenous, Regional and Low SES Attainment Fund.

The 2020-21 budget research package included: $1 billion in additional funding in 2021 to alleviate the immediate financial pressures on universities caused by the lost revenue from international students who were unable to enter the country during the COVID-19 pandemic; $40 million for the Strategic University Reform Fund to bring together universities and local industries to partner on innovative reform projects; $20 million for the Centre for Augmented Reasoning at the University of Adelaide; $157 million in additional funding for the National Collaborative Research Infrastructure Strategy to implement the 2020 research infrastructure investment plan; the University Research Commercialisation Package, which included $243 million for the Trailblazer Universities Program, to boost research and development and to drive commercialisation outcomes with industry partners; a $150 million capital injection to expand the CSIRO Main Sequence Ventures program, which backs startup companies; $296 million for 1,800 industry PhDs and over 800 new fellowships; the creation of a new IP framework for universities to support greater university industry collaboration and the uptake of research outputs; and $1.6 billion over 10 years for Australia's Economic Accelerator, a new stage-gated competitive funding program to help university projects bridge the so-called valley of death on the road to commercialisation.

The coalition delivered short courses leading to an undergraduate certificate or graduate certificate in 2022 and provided $32.5 million to develop and pilot microcredentials, including $8 million to support industry development of globally relevant microcredentials for delivery offshore.

It's disappointing that the accord failed to address the biggest priority in education in this country: the urgent need to turn around declining school standards. In the May budget papers, we learned that 11 per cent of year 3 students remain in the bottom two bands in NAPLAN for reading, up from 8.6 per cent in 2018. The Australian Education Research Organisation, a very important initiative of the coalition, found that, alarmingly, 20 per cent of students starting year 7 have the reading ability of a grade 4 student. Review after review tells us that, despite a 60 per cent increase in school funding over two decades, we're seeing school standards slip dramatically.

The coalition understands that the key to improved student outcomes is evidence based teaching and learning, including the adoption of explicit instruction and the teaching of phonics in every Australian classroom. The science tells us that this is what works, but the Albanese government is asleep at the wheel when it comes to delivering best-practice teaching methods.

Teachers are also being severely hampered by an overcrowded and ideologically driven curriculum which does not allow them to adequately focus on the foundations of education: reading, writing and arithmetic.

Notwithstanding my contribution, where I have outlined the opposition's chief concerns for the bill, I reiterate that the opposition will facilitate passage of this bill, which I commend to the House.

Sharon Claydon (Newcastle, Australian Labor Party) Share this | Link to this | Hansard source

The debate is interrupted in accordance with standing order 43. The debate may be resumed at a later hour.