Adam Bandt (Melbourne, Australian Greens) Share this | Link to this | Hansard source

Young people are getting screwed over by the cost-of-living crisis. Rising rents, supermarket price gouging and mounting student debts are all making it harder for young people to keep their heads above water. University students are graduating with bigger and bigger debts that grow every year and that take longer and longer to pay off. Most people in this place went to university for free but they're more than happy to sentence people to decades of debt. People are now choosing not to go to university because they'll be saddled with these mammoth debts until their 40s or their 50s.

Next year, for the first time ever, arts degrees will cost more than $50,000 under a Labor government. You have Labor to thank for that. With this bill Labor want you to think that they're doing something about it. They want you to think that they give a stuff about these massive debts that young people are being saddled with when, in reality, the Labor government's plan to provide student debt relief will still see student debts rise by 11½ per cent in their first term. That's an 11½ per cent increase to people's student debts under Labor. They're gaslighting you. Under this bill student debts will continue to grow, and young people will continue to struggle under the weight of the cost-of-living crisis.

Here's an idea: wipe student debts and make TAFE and university free. One in three big corporations pays no tax in this country. Let's make them pay their fair share of tax instead of asking students and people who graduate to go even further into debt. The student debt system cannot be fixed, because student debt should not exist. In a wealthy country like ours, if we make the big corporations pay their fair share of tax, then we can make higher education free.

It is beyond doubt that the massive debts that people are under are making the cost-of-living crisis worse. They're locking people out of the housing market. They're causing people to delay having families and they're crushing people's dreams of going to university. We are going to see student debts rise 11½ per cent in Labor's first term. They're saying, 'We'll take $3 billion off the top of that while debt grows to $78 billion.' Three billion dollars is peanuts at a time when one in three big corporations in this country pays absolutely no tax at all. When students who have graduated end up paying more tax than a multinational, something is seriously wrong in this country.

Instead of whacking students with $50,000 for an arts degree under Labor, why don't we go to those big corporations that are making massive profits off the back of people's pain and ask them to pay their fair share of tax. Until we do that, we risk becoming a society where the gap between the haves and the have-nots is just going to keep growing and growing. We are becoming a society where even if you do all of the things that are asked of you and all of the things that they say are the right things—study hard, get a job, try to find a house—you're always going to be behind because you have graduated with a massive debt. Your wages aren't enough to pay for the soaring rent increases because Labor backs unlimited rent increases. If you do manage to find a house to buy, which is out of reach for most people including many graduates at the moment, you end up with a massive mortgage. Mortgages have gone up $1,400 a month under Labor.

We are becoming a society, under this government, where no matter how hard you work—even if you do all the right things—you are never going to be able to get ahead. The Liberals are just as bad because they are the ones that increased the cost of going to university, which Labor has backed and kept with $50,000 arts degrees. These little tweaks—these bandaid answers—from Labor just don't touch the sides. In fact, people are feeling absolutely betrayed. This isn't going to provide any cost-of-living relief right now at all. People thought, when they saw the headlines, 'There's going to be a change to student debt.' People were excited and thought that maybe there would be some relief. But it's not making a difference to the struggles that people are going through right now. It is more gaslighting.

We have an alternative in this country. Instead of asking everyday people like students, graduates and everyone who has done the right thing to pay more, we could ask the big corporations to pay a bit more because—do you know what—the share of national income going to corporate profits has never been higher than under Labor at the moment. Corporations are making massive profits. The banks are making huge profits. Rents are skyrocketing so property developers are doing incredibly well. Instead of reining that in and saying, 'Maybe we shouldn't be giving $175 billion to wealthy property investors that are denying renters and graduates the chance to buy their first home,' Labor is saying, 'We are just going to let the student debt pile keep growing and the cost of doing an arts degree go up to $50,000.'

We are becoming the kind of society where people will stop going to university because they are worried about ending up in a lifetime or decades of debt. That is where we are at now. Astoundingly, earlier today in the Federation Chamber, I heard the Labor member for Higgins warn students not to toy with going to university because debt is dangerous. She said: 'Watch out; you might end up in debt.' Labor is now warning people against going to university because they might end up in huge amounts of debt. That is not the kind of society that we should be living in.

We have an alternative in this country. We could stop giving billions of dollars in handouts to wealthy property investors that are denying renters and first home buyers the chance to buy their first home. One in three big corporations pays no tax in this country. If we say to these big corporations that are making billions of dollars profits—we're talking about excessive profits, multibillion-dollar profits—'You have to pay extra tax when you make above-normal profit' then we would have enough money to do things like wipe student debt and make education free in this country. It is a matter of choice. Labor and the Liberals back the big corporations. They take donations from the big corporations. They back a system where one in three big corporations pays no tax and they back a system where big corporations can put up the price of everyday essentials as much as they want and can make massive record profits and then ask everyday people to pay for them.

I am really proud that my dad was the first person in his family to go to university. He went and studied social work and he was able to do it because education was free. The people in this parliament have enjoyed free education and now they are saying not only to people like my dad but to everyone else out there, 'If you want to go into an arts degree, it will be $50,000 under Labor.' That is what they are saying. Other degrees can cost even more. But meanwhile, they are happy to let the big corporations who pay no tax off the hook. They are happy to say to big multinational gas giants, 'You don't need to pay tax.' But to students, they say, 'We are going to warn you against going to university. We are going to warn you off it because it is going to cost $50,000 and if you can't afford it you shouldn't go.' That is the official Labor position that we heard in the chamber earlier today.

The Greens think we can be a different kind of country. We can be a wealthy country where you are not turned away or warned away from going to university or TAFE because of your income or because of your family background, where you are not put off having a family because you are in mountains of debt as a result of having gone to university, where you are not struggling to make ends meet because you are paying off your university debt at the same time as dealing with another massive increase from your landlord because Labor backs unlimited rent increases. We want the society where everyone in this country and their kids are able to go to university regardless of how much they earn and know they are not going to be saddled with such a big debt that it affects their decisions about whether to have a family or find a home, and we can do that. It is within our grasp. All we need to do is make these big corporations and billionaires pay their fair share of tax. Yes, those big corporations making massive profits are going to have to pay a bit more, but, as a result, everyone else will be able to have what they need to live a good life, including being able to go to university for free.

In the middle of a cost-of-living crisis, one of the best things that we could do to relieve the pressure that people are under is to wipe student debt, and, again, we can afford to do that if we make these billionaires and big corporations pay their fair share of tax. That is the kind of society that I want. That is the kind of society that most people in the country want, not one under Labor or Liberal where it is $50,000 to get an arts degree.

Sally Sitou (Reid, Australian Labor Party) Share this | Link to this | Hansard source

I sat through a lot of what the member for Melbourne has just said about university education and I agree with him on the points of how important it is for the individual and for our society that we do get more people educated. We know the jobs of the future will require us to have more skills. The point where he and I probably differ is around how we pay for it. The idea of free tertiary education for all is perhaps a very good debating point that one can make in a debating society, but I live in the real world, where I recognise that, when university was free for all—when it was totally funded by the government—it was only there for a select few. When we had HECS come in, it meant that we were able to open up the possibility of university education to more and more people. That's the difference between his point on this and the point that I am making, which is HECS is that balance between asking people who are going to benefit from a university education to contribute to some of that education and having government help support them through that education. That system has meant that thousands and thousands of people who would have been locked out of a higher education have now had the benefits of it because they've been able to contribute to it as well as get government support for it. I think that is the right balance, because, as an individual who does get a degree, you do benefit financially from that degree—your earnings are higher—but, as a society, we also benefit from you being more educated and contributing to our country.

My parents, when they came to this country, had very limited formal education. They had the equivalent of about a year 8 education, so they were laser focused on the education of my brother and I because they recognised that having a good education would unlock so many opportunities for our family in this country. Certainly, the education that my brother and I received at university—we were both first in our family to go to university—was pivotal to ensuring our success here and that our family was able to thrive here.

I agree with the member for Melbourne on his point that young people are now being saddled with bigger and bigger debts. The way to solve that is not to take out HECS entirely—a system which, for the most part, has been working to help educate more and more Australians—but to improve HECS and to improve how we calculate the indexation on HECS. I look at my own electorate of Reid, where we've got one of the highest number of university educated residents in all of Australia. About 75,000 people in Reid have a university degree. That number is possible because of HECS, because there is this co-contribution from the student who benefits from it as well as support from the government.

We know that the fluctuation in indexation using CPI has had a huge impact on the debt of young people getting degrees. With this bill is ensuring that we are indexing HECS in a way that is going to be fairer and more affordable. I think what the education minister is doing here is saying that, yes, you do need to contribute to your education, but we do want to make it fairer. We do want to make sure that times of high inflation don't result in your debt increasing dramatically. What the education minister is doing here is using whichever is the lower of the wage price index and the consumer price index as the measuring stick of how indexation on your HECS debt is calculated. I think this is the fair and right approach to be taking. We are, as a government, totally committed to giving our university and TAFE sectors the lifeline that they need, because, under those opposite, these sectors were neglected, and, at some points during the time when those opposite were in power, totally abandoned. We saw that particularly during COVID, when they changed the rules for JobSeeker twice, explicitly to exclude those who worked in the university sector. As a result, we saw the biggest number of job losses that that sector has ever seen. Estimates are that about 15,000 people lost their jobs. We on this side of the House believe that our society benefits when we have a strong tertiary education system. That means a strong university sector and a strong VET and TAFE sector as well.

These measures here are all about trying to strengthen our university sector to make it more accessible to students, particularly students from disadvantaged backgrounds. I have seen firsthand the transformational change that a university degree can offer people. I saw that in my own life and also in the lives of my friends and family who were able to benefit from a university degree. It meant that they could get jobs that were well paying and jobs that really helped them find fulfilling career paths. With this measure, we are going to be wiping $3 billion in student debt for more than three million Australians. This is a message to young people from this government that says: we recognise the challenges that you are facing at the moment with the cost of living and we recognise the challenges that you have faced being saddled with increasing debt as a result of your university degree, but we are making practical changes to ensure that we can fix that. This is a much-needed change.

I want to give examples of what this will mean for an average student in Reid. After the 2023 indexation, the average student HECS debt in Reid would have been about $32,700, but the change that we are making for that student with that debt means that they are now going to get about $1,400 back because of the change in the indexation. That's going to be a significant saving to that student. This is something that I'm really proud to back because it acknowledges that young people are doing it tough at the moment and that as a government we are trying to do everything we can to support them and their ambitions.

Importantly this bill also has something that so many students who are currently doing social work, midwifery, nursing and teaching degrees have welcomed, and that's the Commonwealth prac placement. Those students who are going to be entering professions where we desperately need more workers are now going to be paid while they are doing their prac. The day that this measure was announced, I went out to the Australian Catholic University campus in Strathfield in my electorate. I met with a range of teaching, nursing and midwifery students, and they were so grateful for this change.

Some of the stories I heard were incredibly moving. I spoke to a teaching student who was in his final year. Unfortunately he won't benefit from these changes, but he told me that many of his cohort, who loved teaching and loved the idea of going into this profession, simply couldn't finish their degrees, because they weren't able to support themselves through the prac placements. They were suffering a financial hit. They weren't able to pay the bills or pay the rent, so they had dropped out of the degree. That was really sad to hear. This change means that more of the students can complete their degrees and then go on to become teachers, nurses, midwives and social workers.

I heard from a mother of two. She decided to go back and do a nursing degree later in life. She did that because of the incredible care that she had received at hospital when she had had some miscarriages that had had a big impact on her wellbeing and her physical health. She really wanted to give back to the community and say thank you to those nurses who had helped to look after her, so she went back to study nursing. She said that she has had to rely on her parents to help her financially during her prac placements because, again, she wasn't able to financially afford the bills or afford to pay for all the things that her young family needed. With prac placements, eligible students will be able to access up to $319 a week, which is similar to a Commonwealth youth allowance payment. She says that that will give her greater financial independence and will mean that she'll be able to finish this degree and look after her family.

These are just some of the stories that I've heard, but I know that so many of my colleagues have met with many of these students and heard firsthand the difference that these Commonwealth prac payments will make. In fact, I'm now meeting with other students—pharmacy students and engineering students—who hope that these prac placement payments will be expanded to their degrees as well, because those are professions where we desperately need more people.

Ultimately what these measures say to young people in our community is that we know that it has been a real struggle for you and that the cost of living and the debt that you are saddled with as a result of these degrees have been really challenging, and this is one part of the work that we are trying to do to help support you. But it's not the only thing.

Certainly, young people were at the very core of our focus when we made the changes to the stage 3 tax cuts, and 99 per cent of those young people who are gen Z and 97 per cent of millennials will be better off because of the Labor government's changes. Again, this is another example of the Labor government putting young people at the very centre of the work that we have been trying to do. At the university level, we're trying to make sure that we lift the minimum wage, because many young people are working in hospitality or as early childhood educators. So we want to make sure that their wages are lifted. We wanted to put them at the very core of our focus when it came to tax cuts as well, and they are the main beneficiaries of the tax cut changes that we made.

I know that young people have been struggling for a long time. This is a government that is listening and making practical changes to try and make your lives a little bit easier.

Allegra Spender (Wentworth, Independent) Share this | Link to this | Hansard source

In Australia we believe that each generation should leave the next generation better off. I think this is something that is deeply, deeply held, and something that, as a parent, I hold in particular. But I spoke recently to a young man in my electorate, a young man called Hugo, and he highlighted to me that the feeling at the moment among young people is that that is just not happening. He said: 'I feel like I've done everything right. I worked hard at school. I worked hard at uni. I've got a good degree and a well-paying job, but right now I'm saddled with $50,000 worth of HECS debt and I do not believe I'll ever be able to afford my own home.'

Recent conversations with people like Hugo have made me question whether Australia is on the right track in terms of making sure each generation is better off than the previous generation, and I don't believe that we are. The bill that is before the House, the Universities Accord (Student Support and Other Measures) Bill 2024, will make some small steps towards rebalancing these challenges, but there is so much more to do.

The bill introduces a number of changes proposed by the Universities Accord, and in particular it will introduce changes to the HELP indexation scheme to make study more affordable. It will also change funding arrangements for practical placements, an acknowledgement that not all Australians are in a position to take unpaid work. I'm really proud that this bill is here in front of the House, and I'm really proud of the role that I and many on the crossbench have played to get it here.

Over a year ago, I and others went to the education minister and really highlighted the deep concerns that we had about the indexation of the HECS debt for young people. I had spoken to many people in my electorate and also members of my team who talked about how difficult it was watching their HECS debt go up by seven per cent a year because of the high inflation. This was meant to be an interest-free loan, and, actually, the rate that they were paying was significantly higher than the mortgage or loan rates that were being offered by the banks. It felt so terribly unfair at a time when young people are struggling with higher education costs than previous generations, rent difficulties and the prospect of not being able to really stand on their own two feet and eventually own a home themselves.

We wrote to the minister. We raised these issues with him repeatedly. We asked him questions in question time. A colleague of mine Monique Ryan put forward a petition on this topic which got, I think, hundreds of thousands of signatures in support. It isn't just the students concerned about this; it's their parents, grandparents and the whole community who are concerned. There's a real sense that the community is concerned that young people are falling behind, and it is up to us in this parliament to do something about it.

I am very pleased that the government eventually committed to these changes and has finally introduced this bill to parliament, but I want to acknowledge, as we go through the detail, that there is much more to be done. I will continue to pressure the government to change the date of HECS indexation to account for the compulsory repayments throughout the year, to update the potential guidance for the treatment of HECS by banks and to remove the highly problematic Job-ready Graduates scheme introduced by the former coalition government. I will also continue to advocate for measures that ensure that universities remain a safe and inclusive place for all.

Australia has a proud history of educational equity. While university is not free, initiatives such as the HELP scheme and caps on course fees for domestic students enable relatively equitable educational attainment, certainly, compared to some of our peers. We also have a high-quality education system that blends theory and practice. In many degrees, this involves integrated work placements that ensure our graduates obtain the skills they need to excel in the jobs of their chosen field. This is because we recognise the importance of good quality education in our evolving workplaces. Jobs and Skills Australia expect that the share of new jobs requiring further education beyond high school to increase from 70 per cent to 90 per cent over the next decade. We also recognise the role that education plays in access to social mobility and greater opportunity for all.

But affordability of education is becoming a barrier. The HELP scheme is a critical part of our education system, and it's not perfect by any means. Many of the three million Australians with a HELP debt still face a number of financial barriers. It's not just a deterrent for those deciding whether or not to undertake further studies at the completion of their schooling; it's also a deterrent for the people for whom cost is a determining factor against further postgraduate study or upskilling or reskilling as mature-age students. Either way, the impact of debt on decision-making limits individual economy-wide workforce potential and contributes to skills shortages of the future.

The average time to pay down a HELP debt now is 10 years, and the existence of this debt has implications for access to other credit, particularly mortgages. Homeownership among young people is plummeting, mostly as a result of inadequate supply that has been driving the prices up. But it's also because students are going to university and accruing student debt as well as setting back the timing to join the labour force and buy a home. Homeownership for those aged 25 to 34 has declined approximately 20 per cent in 40 years.

I want to take a pause here because I think we need to recognise why there is so much anger and concern not only amongst younger generations but also frankly the whole community. The point is that this generation of young people who are finishing school, going to university or going to work are the most educated young people we've ever had. They have put more into their studies and more into being ready for work than any generation that we've had before, but, at the same time, they are less likely to reach the goals in things like homeownership than previous generations have. So they've got this effort in, and they are not getting the reward out. This is the fundamental imbalance that we have right now, and this is what we in this parliament need to address and need to address urgently.

This comes back to why this bill is important but why this bill is only a small part. The HELP indexation model worked reasonably well in a low-inflation environment. But, when we had a high-inflation environment, with inflation at 7.1 per cent, newly graduated Australians had their HELP debt increase by thousands of dollars quite literally overnight. It increases the financial strain on graduates but also has the impact of deterring others from pursuing higher education altogether. The changes to the HELP indexation, which tie indexation to the lower of either the consumer price index or the wage price index, will provide protections to students so that, in times like these, their debt will not increase above their wages, and I think this is absolutely critical.

I want to also acknowledge the youth action committee in my community of Wentworth. Previously we asked Wentworth if there were young people out there who wanted to join a youth action committee. We have been overwhelmed by the response, and I've been overwhelmed by the strength of that youth action committee. One of the issues that my committee wants to focus on and is focusing on right now is financial literacy for young people, particularly around HELP or HECS debt, because they recognise that so many people go into university without actually understanding what they're signing themselves up to. This is of huge concern for young people as they move further through their university education. I want to say congratulations to the youth action committee on the work that they are doing. It is really important. I'm very proud that you're also advocating for this legislation and for the changing of the indexation of HELP debts, and I'm very proud to be able to stand up and support it today.

I'd now like to move on to practical placements. Prac placements are an integral part of many academic programs, providing students with invaluable real world experience. However, the requirement to undertake unpaid placements often presents a significant barrier for students, particularly those from low socioeconomic backgrounds or those who might not have the support of being able to live at home. Professions that rely most on unpaid prac placements are also in the care and teaching sectors, which have a disproportionate number of female enrolments. Students shouldn't have to choose between gaining essential experience and meeting their basic living expenses. This bill will ensure that all students, regardless of their financial situation, can benefit from the same opportunities to gain practical experience. This is not just about supporting individual students; it's also about ensuring that our future workforce is diverse, skilled and capable of fully contributing to our economy and society.

For the same reason, I support the intention of this bill to fund more enabling courses that help people prepare for undergraduate studies. These courses particularly support those from disadvantaged backgrounds and mature-age students, for whom there are greater barriers to obtaining a university degree. While I support this measure, analysis by Andrew Norton shows that a fixed funding cluster will impact different disciplines differently, with degrees such as science taking a substantial hit under the proposed system. This will require monitoring, since the policy will rely on universities to cross-subsidise these courses to avoid having the opposite effect of fewer places in certain fields.

While the measures introduced under this bill represent progress, there are still significant bugs in our education system that work against the outcomes we seek of equity, fairness and even safety. Firstly we need to have a smarter system that accounts for the pay-as-you-go contributions people make to their HECS debt throughout the year to avoid indexation on debts they have already paid. This was recommended by the University Accord but was left out of this legislation. This could be as simple as changing the date of indexation from 1 June to after the deadline of individualised tax returns.

Similarly the treatment of HELP debt by banks excessively impacts a person's borrowing capacity. Currently the APRA guidance for HECS is one sentence long and requires HECS to be treated the same as other types of loans including buy-now pay-later loans. This is despite the fact that HECS repayments are income dependent, unlike other forms of credit. The Australian Banking Association has said that it would be open to considering HECS debt differently, but, until prudential guidance says otherwise, its hands are tied. We need to get rid of the Job-ready Graduates program put in place by the former government, which is inherently unfair, not to mention completely ineffective. Attempting to funnel students into certain occupations through jacking up their fees on underappreciated courses and skill sets, such as art degrees, is highly problematic.

Second lastly, I think we need to increase the number of courses that are covered under the prac payment. I note that psychologists are not covered under these prac placement payments, and, with a significant shortage of psychologists and counsellors in our community right now, this is an area where the government should be moving, because it would make a significant difference.

Finally, we need to put in place measures, as the government has just announced this week, that ensure that education institutions are safe places for all. Recently, I've spoken to parents who've told me their children are no longer attending university in person because of abuse and intimidation—particularly, these are Jewish students. I've also spoken to women who have been assaulted on campus, and I was very proud to stand yesterday with the STOP Campaign, who are really the people who drove the changes and the establishment of the National Student Ombudsman. It will help prevent violence against women on campus, but it should make a difference to many other students as well. I look forward to working with the government over the coming weeks to ensure that the new bill introduced this week contributes effectively to that objective.

Susan Templeman (Macquarie, Australian Labor Party) Share this | Link to this | Hansard source

I am really pleased to be standing to support a piece of legislation, the Universities Accord (Student Support and Other Measures) Bill 2024, that is going to make a tangible difference to people who have made the decision to go to university to further their education. With that decision come costs that they pay, not only in the debt that they accrue but also in the sacrifices they make in terms of earnings, and this bill will go some way to supporting people and encouraging them in that decision.

The first change that we're making in this bill is around HECS, or HELP. We're making it fairer for everyone who has a HECS or HELP debt—some people still call it HECS; we know it's also HELP—and we're wiping around $3 billion off that debt, and that's for about three million Australians. For someone with an average HECS debt of $26,500, this means that their debt will be cut by about $1,200. Students, or people who are former students—because you carry your HECS debt with you for some time—have told me how pleased they are to see that move.

The second step is that we are, for the first time, introducing a Commonwealth payment to support students doing their prac. Now, the start of this is going to be for teaching students, nursing students, midwifery students and social work students when they have to do their mandatory placements. This Commonwealth prac payment will ease the burden on them. Now, no-one's suggesting it's an absolute quick fix, but we know that many students have to give up their normal paid work to do their full-time placements—and not just for one week; we're talking about doing that for multiple weeks at a time. This is one way to alleviate that burden and help them get through what, in itself, is a challenging thing—to take that learning you've done and put it into practice—without having to worry as much about the financial impost and loss that you have. For a lot of people, these prac placements are so challenging that they actually choose to delay their degrees and not complete them, or to take much longer to do them. We need the jobs that they're doing: we need teachers, nurses, midwives and social workers, so those are the groups we're starting with. But I really look forward to the success of it, so that we can have more of it to come.

The third thing in here that is going to change people's lives is the fee-free uni-ready courses. I spoke to a young woman called Amy who is doing one of these, and she says that the ability to access this course is the difference between her choosing to take a risk on furthering her education or just saying, 'Nup, it's too scary.'

Let me tell you what other students have told me about the changes. Natalie, a Hawkesbury local and teaching student at Western Sydney University, said, 'This will be incredibly helpful for me, my levels of stress and my bank account,' so it's a win all round for her. Rebecca, who is also studying teaching, said that, as a young person, she was praised for taking up a profession that was so desperately needed, yet she was thanked with a debt and full-time work with no pay, and she says, 'I no longer have to fear this, under a Labor government, and I'm receiving the support that all education students deserve.' A nurse, Abby, from Faulconbridge is so glad to see the introduction of the paid prac for students. She said she was lucky to be living with her parents at the time, but she knew many people who had to do their prac and then do their own paid work. These are good changes.

Ian Goodenough (Moore, Liberal 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.