Kim Carr (Victoria, Australian Labor Party, Shadow Minister Assisting the Leader for Science) Share this | Hansard source

I move:

That the Senate condemns the Abbott Government’s vicious cuts to higher education and the devastating impact they will have on regional students, families and universities.

Since the government unveiled its grand plan for higher education in the budget, the Minister for Education has spent a lot of time touring regional Australia. He is desperately trying to spruik the benefits of what he sees as a deregulated system, as well he might, because regional universities and their students are likely to be the biggest losers if the proposed changes are ever implemented—the biggest losers, that is, amongst a litany of losers. All universities will be losers because of the $5.8 billion that the government is taking out of the higher education system. That includes a 20 per cent cut in course funding. So nearly all students in some way will lose because most will have to pay higher fees and take on much bigger HECS debts.

To recap, this is a budget that has shaved $3.2 billion from the HECS-HELP arrangements. These are arrangements that Australia has developed. They have been highly successful. They are internationally renowned as income-contingent contribution schemes. There have been proposals for the repayment threshold to be lowered and for real rates of interest to be charged on student debts. For some courses, the new HECS loan repayment will be at real rates of interest, which will mean debts in excess of $100,000 to get a university degree.

The government will be seeking to have the opportunity for universities to actually charge tuition fees for Australian students studying award courses within Australian universities. What we are seeing here is a tactic that clearly is not working for the government—a tactic being pursued where we have seen that not one of Australia's 39 vice-chancellors has given unqualified support to the higher education changes. It is a fact that all the vice-chancellors in Australia understand the enormous risks in what the government wants to do. They will all feel the force of the questions posed by those amongst them who are publicly questioning the government's direction. Take for instance the Australian Catholic University's Professor Greg Craven. He asked:

Is it really worth a couple of Australian universities getting very slightly better … at the cost of the remainder becoming very much worse?

In other words, the minister is willing to inflict substantial damage on a system built on equality of opportunity to pursue his illusionary goal of transforming some of the elite so-called sandstone universities into Australia's equivalent of Harvard or Stanford. He says that Australia will never have a world-class university unless universities can set their own fees, unless the higher education market is opened up so that non-university providers can compete for the diminished pool of public funds and unless students take on much bigger shares of the cost of their education.

Minister Pyne praises the American model of higher education without acknowledging what it actually means for the overwhelming number of Americans who can never attend a university such as Harvard or Stanford because their families are simply not wealthy enough and there are not enough scholarships. The minister should heed the warnings of someone who understands the American system much better than he does, such as the Nobel Laureate for Economics Joseph Stiglitz. He was recently visiting Australia and published an article in The Guardian today. In this article, Professor Stiglitz points out that, in the United States, total student debt is now more than $1.2 trillion. That is more than the entire United States credit card debt. It is not only a burden for individual graduates—it is a lifetime burden, in many cases—but it is now also an increasing burden for the entire United States economy. Professor Stiglitz says the failed US model of higher education funding is one of the reasons that, among the advanced countries, the United States now has the least equality of opportunity.

During his time in Australia, Professor Stiglitz repeatedly pointed out—and he advised the Prime Minister accordingly—that the Prime Minister and the education minister clearly do not understand the consequences of following through with an American model that they profess to admire so much. They simply have not grasped that none of the great US universities is a for-profit institution. It is not price competition that has made Harvard, Yale or Stanford great universities in the world. It is a competition of a very different type that has led to the success of elite US universities. They are either publicly funded or they are all supported by very large endowments that dwarf the operating budget of the entire higher education system in this country. It is their reputation for excellence in research that has made them the envy of the world. Of course, much of their research is actually funded by the US government. As for the so-called under-regulated US universities, they are indeed run on a for-profit basis. Professor Stiglitz says they:

… excel in two dimensions: the ability to exploit young people from poor backgrounds, charging them high fees without delivering anything of value, and the ability to lobby for government money without regulation and to continue their exploitative practices.

It is part of the US higher education experience with which many people would be familiar. It is not the Harvards or the Stanfords that Mr Pyne's reforms will impose on Australia.

I repeat: the United States has some of the best universities in the world, but it has many of the worst. The consequence of the policies being pursued in this country by this government will lead us not to the very best in the world but to some of the very worst. The open higher education market that Minister Pyne pines after will, of course, be an under-regulated system because the legislation before this chamber removes the national regulator from its critical role as the quality assurance regulator. TEQSA, under this government, has had its budget cut by $31 million; almost half of its funding has been taken away, and its functions have been reduced. So it has been deprived both of its resources and its powers to oversee at a time when the government is proposing that we have a very significant increase in the numbers of entrants into the so-called higher education market. So Minister Pyne's arrangements leave us with a shrunken regulator, the reductions to which will actually provide it with less opportunity to give proper supervision for accrediting courses and will mean that the minister, under these legislative changes, will have greater powers for personal direction.

All of this produces a very grave set of circumstances, particularly for regional universities. It is these universities and these students in the regions that will be amongst the biggest losers, as I have said, in this so-called brave new world of Minister Pyne's. They are already struggling to compete with the older, established universities that have benefited from in excess of 150 years of public investment. They are already losing students to these universities, which are able to lure students who can afford to move to the cities to study. Students who cannot easily afford to move have been attracted to regional universities, which do a very good job. As a result, regional universities have a much higher proportion of students from working class backgrounds. Poorer students tend to go to the regional universities. Almost one-third of the students from Central Queensland University, for example, are from low-income families, compared to only seven per cent at the University of Melbourne.

Regional universities do have a very special role in promoting equality of opportunity. They do create opportunities, and often for students who are the first in their families to receive a university education. So the proposals to increase the pressures on these universities is clearly something the Labor Party will reject. These are universities that do provide this nation with a capacity to increase its knowledge base, a capacity to be more responsive to local needs, and a capacity to ensure that we have high-skill, high-wage jobs in the regions themselves. Under the minister's deregulation system, they will not have a special role. The minister of course claims that they will be able to have access to Commonwealth supported places. That is, of course, one of the great Orwellian expressions of this package, because these are not Commonwealth supported scholarships that he is talking about; the Commonwealth supported places that they are proposing will have to be produced on the basis of 20 per cent less funding from the government. If the minister really does believe that the change will brighten the future for regional universities, then he clearly does not have an understanding of what actually happens within the higher education system itself.

We know that the smaller universities, the regional universities, with a higher proportion of students from low-income backgrounds, will have to raise their fees. They will be appealing to people who have less capacity to pay. They will, of course, therefore be under greater pressure. When they do raise their fees, they will have to make decisions about what they cut. They will not be able to meet the funding requirements that this government is imposing upon them, and it is simply not good enough to say that it is a matter of choice for them, because the universities will have to decide what they cut as well as how much they increase fees to compensate for the loss of government revenue.

They know that the real prospects for some regional universities may well be that they become teaching-only institutions. That would create a downward spiral in terms of their standing within the education system and would create a two-tiered system, because we know that the government is also considering cutting the amount of money that is available to teaching-only institutions. It is clear that, under these circumstances, regional universities would have extreme difficulty competing with metropolitan universities.

We also know that, for the private sector, the opportunities for competition come particularly at the regional level. That is something that the minister must surely have been advised by now but which he cannot publicly admit.

We already know what the consequences are for the TAFE system, because we have seen these experiences operating in Victoria where the older TAFE colleges have been under intense pressure as a result of deregulation brought about by the Liberal government in Victoria, which has seen profound challenges to the TAFE system. The TAFE colleges in Victoria are under enormous pressure, and many are actually facing financial ruin.

Senator McKenzie interjecting—

We do understand that the government in Victoria is now seeking to offer courses at less than $2 and $3 an hour, for TAFE provision in the state of Victoria, under their competition models. The minister, of course, pretends that it would be otherwise—and, I am sure, the National Party, which of course has demonstrated what incredible doormats they are when it comes to defending regional interests in this parliament. We understand that they are only too happy. They understand that not only were they duped in terms of changes in the budget on fuel and various other things but also they were duped on this question of education, because the big losers were the people that the National Party claims to represent here. They know that there is a great fantasy—the fantasy that regional universities will do better. We know that the complete opposite is the case.

In the deregulated environment the sandstone universities will have the most options, will decide what courses they will be able to operate, and will, of course, enjoy the maximum benefit of subsidising their research programs by being able to charge higher fees. This is the great irony here. The government says it is about increasing the universities' capacity in this country to compete internationally. But all the competitive indices are based on research. A university's ranking internationally is based on its research. This government, rather than funding research properly, is saying that you should slug students and transfer whatever surplus you get out of the teaching into research. Just imagine how students must feel in those circumstances—to know that their fees are going towards the funding of the research program. Just imagine how their parents must feel when they know that the cost of a $100,000 degree will mean that they may have to, if they want to help their kids, as we know many parents do—

Senator McKenzie interjecting—

I think we would all understand this, Senator McKenzie; I am sure even you would take this view. If you have to fund a $100,000 degree, then you will have to make a choice, and that choice may well be a second mortgage. Just when you think the circumstances are improving for you and your family, you have to take out a second mortgage to pay the kids' HECS debts. Or it could be that, on top of that, you have to choose which of your kids to help because you cannot afford to help them all. That is exactly what it was like under Menzies: middle-class families had to make a choice about which kid they helped. Degrees costing $100,000 mean you cannot necessarily expect all your kids to benefit. The government has not thought that through. Working-class people who have a view that they have got the right to get the very best opportunities in this country know that they cannot afford $100,000 degrees. The question will be: will that be a deterrent to them, particularly in regional and rural areas? Working people in regional areas will be saying they cannot afford that, so the universities become bastions of privilege.

We all understand the benefits of higher education—an improved income. We also know that people pay higher taxes. But we also say there is a benefit to the nation in ensuring that the country is highly educated in terms of quality jobs, productivity and social justice. But what we are seeing under this government is an end to those principles—the principle of the fair go is being ripped up. This is a government that simply wants to rip up the fundamental principles of equity when it comes to higher education.

We understand who the beneficiaries of this arrangement will be—the people with money, the people who are already privileged. And they will pass on their privilege to their kids. This is why Labor has remained so committed to ensuring we have an education system that is open and fair for everyone. That is why we had a target of ensuring 40 per cent of people under the age of 35 are able to go to university—and we are almost there. Under this government, you will not see that. We also said we wanted to see 20 per cent of our university system made up of people from a working-class background, from a poor background. This government has abandoned that target, let alone committed to seeing that opportunities are there. Under the illusion of competition, we have a government that has set out upon a magical mystery tour where it tries to copy the very worst aspects of the United Kingdom and the very worst experts of the United States. We have a situation where students in country areas will be profoundly disadvantaged in favour of wealthy students in the city.

What does the National Party say about all this? They just cop it sweet because they are the doormats of this government. This is a government that walks all over the National Party because the National Party has lost its way. The National Party has no understanding of what social injustice means. The government is now following in the footsteps of the United Kingdom and being chased by the National Party to go even harder in the process. The consequences will be that many graduates will now be faced with debts that they will never be able to repay—at the very time when they are trying to build a family, buy a house and get on with their life. Their parents will want to help them but they will not have the means to do so. The consequences are simple: Australia will become a much less fair place. Students, teachers, nurses and a whole lot of people on low incomes will have massive debts. (Time expired)