Christopher Back (WA, Liberal Party) Share this | Hansard source

I am absolutely delighted to contribute to this motion of Senator Carr's, regarding the Abbott government's impact on regional students, families and universities. I do so with the advantage of having had 11 years as a member of the faculty at Curtin University's regional campus at Muresk in Northam, and also a history of having been a visiting academic at the University of California, Davis in 1979-80 and the University of Kentucky in 1980.

Senator Cameron will not be surprised or disappointed to learn that I will not be dignifying anything that he has contributed this afternoon with a response, simply because the font of human knowledge has not been advanced by one drop as a result of Senator Cameron's discourse this afternoon. What I do want to comment on, if I may, are some statements made by Senator Carr in moving his motion. I was absolutely blown away that an otherwise intelligent person could have come out with the statement that there had been no support from the university sector for Minister Pyne and Prime Minister Abbott's initiatives. Let me commence my contribution with a couple of comments from people who might know what they are talking about. Let me start with the Labor member for Fraser here in the ACT, Dr Andrew Leigh, who said that Australian universities should:

… be free to set student fees according to the market value of their degrees. A deregulated or market-based HECS will make the student contribution … fairer, because the fees students pay will more closely approximate the value they receive …

You, with your distinguished career academically and in the world of finance, Mr Acting Deputy President Whish-Wilson, could relate to this.

I go to that luminary of Labor, Professor Gareth Evans, who said, along with the vice-chancellor of the ANU: 'The education reform package announced in the budget will allow the ANU to offer an education that is like no other in Australia, amongst the best in the world.' He went on to say that they were 'delighted to see that this government has heeded and included in the package the recommendation of ANU chancellor Gareth Evans' in the sense that the universities be required to put a proportion of their fee income 'towards equity scholarships'. So that is coming into my discourse. The Group of Eight universities are themselves fairly substantial in this country. I quote their president:

In particular we support: expanding the demand-driven system to non-university providers, with adequate quality controls; extending funding to sub-Bachelor Degree programs (e.g. Diploma and Associate Degrees);

That was the Group of Eight recently—in only May of this year—so where Senator Carr has been hiding I can only guess.

I now go to the Regional Universities Network, since that is the topic of our motion. What did they do in May of this year? They welcomed:

… the announcement in the Budget of an ambitious program of reform for higher education which recognises the importance of the sector to Australia—

one which I had the pleasure and pride to represent and to contribute to in those times. They went on to say:

The Treasurer and the Minister are to be congratulated for highlighting the important role Universities—

these are the regional universities—

play in Australia’s future.

I quote the Australian Council for Private Education and Training—again, from only a month ago:

The changes the government has announced tonight offer all students funding support …

Isn't it a shame that Senator Cameron is not here, so we could listen to him rant about people not having the opportunity to participate in higher education? If he had only done some research himself—if he had only looked at what the Australian Council for Private Education and Training has said:

They will support genuine student choice and competition among all of Australia's 173 higher education providers.

It gets better. I now go to Monash University's President and Vice-Chancellor, Professor Ed Byrne, from 14 May:

The approach in the budget lays out a series of steps for an ambitious deregulation of the sector. The future of universities will be more in their own hands than ever before.

I now come back to Western Australia and the Chancellor of UWA. Dr Michael Chaney said this as a result of the left-wing students all out there protesting:

I'm a bit bewildered to see left-wing students campaigning for lower fees on the basis that people who don't go to university should be funding their education … What they're saying is people who don't go to universities should through their taxation be funding university students who, in due course, earn higher incomes.

What a tragedy that Senator Cameron is not here to hear that.

Now I go to another quote if I may, very briefly, before I get into the text of my own contribution. This is from the retired Vice-Chancellor of the University of New England—itself a regional university—Professor Jim Barber. This is what he said in response to the commentary about fees going through the roof:

I have no doubt the big end of town in Australia will begin jacking up their prices in response to fee deregulation, but they will be doing so just as a range of new online, low-cost yet high-quality competitors are entering our domestic market.

Isn't it amazing what competition does, Mr Acting Deputy President? You have lived a life in the competitive world of finance and you know that as well as I do. But one moment: I now come to the last of my contributions. This is from the Vice-Chancellor of the University of Wollongong—itself a tremendously entrepreneurial university—Professor Paul Wellings. He commented that universities should anticipate changing behaviours from undergraduate students who—you would not believe this!—will want greater engagement in return for the changes to the funding model. Isn't that revolutionary? The students might actually get out there and make a cost-benefit analysis. They might get out there and say: 'Which course is most appropriate to me? Which one is best to invest my future funds in, because I want to make sure I get the best qualifications for the career I want to pursue?'

The only comment I will make to Senator Cameron, before he gets off his high horse, is that I too am the son of a man who started his working career in the Depression days on the wharf in Fremantle. My mother was a bank secretary because she had to leave school early to support the farm. So my own background matches that of many others in this place. I had to get to Queensland University on a cadetship fully paid for by the department of agriculture. Do you know what happened? I had to work to pay it off. That was in 1971. I should have worked for five years; I worked for 2½ of the five years under my bond. Then what did I have to do? Through you, Mr Acting Deputy President, to Senator Ruston: I paid the other half back. There is nothing new about this.

Those are the comments that Senator Carr does not know about—what the university sector is saying and thinking. Allow me to comment for one second on the American system because I have, as I told you, worked in it on three occasions with a great degree of pleasure and pride. Unlike Australia, where every person starting up their career from diploma, to advanced diploma, to sub-degree, to degree, to master's degree, can walk in without paying a single, solitary penny and start their course—borrow that money and not pay a penny—in the United States, it is a very different situation. You either borrow within the family or you might receive some sort of city or parish based support. You might get some financial aid.

My own daughter-in-law went through university at the University of Louisiana. It was a three-year degree; she came out with a $40,000 debt. The interest rate is interesting. The bond rate in the United States at the moment would be one per cent—you would probably know that better than me, Mr Acting Deputy President; would it be about one per cent, the bond rate? She is paying four per cent on her debt. And do you know when she started repaying it? She started repaying it the day the loan was given to her—not when she earned $50,000, and not at 2.9 per cent when our bond rate is 3.75 per cent. It was none of that—it was four per cent. The American government is making money. Yet we are invited here, by the likes of Senator Carr, Senator Cameron and others, to vilify what Australia is doing when it comes to financial support.

Let me turn, if I may, to regional universities in particular. Remember this: you can start your course without putting up a penny. But it gets better, because a student could start a part-time course. They could be working and they could say, 'I want to do economics. I want to follow Senator Whish-Wilson'—at least, as far as your stock-broking; not as far as you have got, Senator Whish-Wilson. We will stop at that. That loan is available to that student from the day they enrolled in their course of study, be it at university, an advanced diploma or whatever.

It gets even better again for students, in regional universities in particular, but also students anywhere. My own experience at the Muresk Institute of Agriculture was that there are a lot of students from farming backgrounds. There would occasionally be a tragedy in the family. The father might have become very ill or whatever. That student would have to terminate their studies for a period of time. Do you know what you can do under this new scheme? You can suspend your studies—suspend your loan—and you still have not paid anything off. You have paid nothing. You can go away for that one or two year period, sort out whatever the issue is and come back and recommence your studies and your loan. How much better is it than that?

Previous speakers have spoken about cutbacks in funding. Let me tell you what the figures are. In Labor's last budget for 2013-14, higher education funding was $8.97 billion. Our budget shows that growing to $9.47 billion. Last time I was at school, probably even a school similar to Senator Cameron's, 8.97 was a lesser figure than 9.47. When it comes to the Commonwealth Grants Scheme, our funding is going up from $6.2 billion in 2013-14 to $6.7 billion in 2017-18. Those are the figures.

Let us talk about this new opportunity. It is now being extended to colleges and institutions that run higher degrees, advanced degrees and associate degrees, and this government is putting in $370 million over three years. Why is this so important? My experience at places like Muresk and others is that quite often young people were not of themselves at that time qualified to get to university. They might not have studied the right English subjects. Because of their limited academic or educational opportunities, particularly young boys and men, they may not have had that confidence to go to university. What they can now do is enter into a diploma course or an advanced diploma course and build up that confidence, build up that love of learning that they did not know they had, with the loan, without paying a cent, until they actually start earning $50,000, which, with CPI linkage, we know is going to be more than $50,000. But what they do is they learn to love to learn.

The opportunities that now exist with this new program, and we are seeing it already, are that colleges are talking with universities so that we can have that seamless movement. No longer these silos, these hierarchies, where that is a TAFE, that is a college of advanced education, this is a university. It is not like that any more. Break down those stupid silos and barriers and guess what we end up seeing? We see that happening. And in my own state of Western Australia it is already happening in country areas. In the City of Bunbury, Notre Dame University and UWA work very collaboratively in the health sector. In Bunbury! I asked those vice-chancellors, 'Why can't you do that in Perth?' 'That's the city, Senator; it's different'. In Geraldton we have a circumstance in which an eastern state based university, Charles Sturt University—which I wish to come to in a moment—is involved in a program with Western Australian institutions.

Further to that $370 million, we are putting $450 million over three years into Commonwealth funding for Australian higher education in the non-university institutions that do offer bachelor degrees. The third initiative is to open up Commonwealth funding for privately owned universities and privately owned non-university higher education providers—tremendous genuine competition. Eighty thousand new students by 2018, and who are a lot of them? They are the low-socioeconomic people that Senator Cameron seems to think do not have the capacity to realise an interest delayed loan, a nil upfront payment loan. Well I have a lot more confidence in young people in general, and particularly low-socioeconomic people.

I come to the point, from my own experience, that the big issue we have in Australia at the moment is non-completion of up to 50 per cent. All of us have been to university—Senator Mason, Senator Ruston; I do not know whether Senator Lundy, Senator Bilyk, Senator Moore or Senator Bullock may have this experience—and you may recall the tradition used to be that the vice-chancellor would line you up on day one, and in my case it was in Winthrop Hall in Perth, and he would say, 'Shake the hand of the person next to you because they're not going to be there next year.' There is a 50 per cent drop out. We will see far less dropping out when we see students have the opportunity to choose their own course, to choose a course that will be tailored by universities because in a deregulated environment they know they are going to have to sink or swim—and they cannot wait. They cannot wait to get out there and be part of it. So we are going to see higher completion rates, we are going to see greater choice for students and, in my view, we are going to see greater engagement of students. I have absolutely no doubt about that.

Let me turn for a moment to the current situation, as opposed to the new one. In fact, the comment was made earlier by one of the professors I have quoted. At the moment, and I do not know if people realise it, the Australian taxpayer pays 60 per cent of the education of a student. Now many Australian taxpayers are themselves not from university backgrounds, so therefore you have people who were not at uni paying for the course of somebody who does go to uni. And then you get the odd student who wants to spend a year or two in the library or at the local bar and never bothers graduating—and guess who helped to pay for their early efforts at university, where they did not see a lecture theatre or a tutorial or too many laboratories? What it will do is go from a 60 to 40 ratio to fifty-fifty. At the moment the HELP scheme, or the HEC Scheme, is at the interest rate of 2.9 per cent. The government borrows at the bond rate, which at the moment is about 3.75 per cent. Who picks up the difference, do you reckon, between the 2.9 and the 3.75? The taxpayer does. At the moment we have got a $6 billion or $7 billion unpaid HECS or HELP debt and, once again, you guessed it, it is the dear old taxpayer of Australia who picks up those figures. Surely we have got to see some more fairness and equity in that situation.

I come back to the comment I made earlier: remember, someone can do the course part time; be working and do the course part time. They could probably afford to borrow, but, no, they do not have to. They can take that low-interest loan—if they were to get a personal loan to buy a motor car, eight or nine per cent; if they were going to get a loan to travel overseas, 11 or 12 per cent possibly; even if they have a housing loan, 5½ to six per cent—and this particular loan has absolutely no repayment at the time. Put it in the bank and make some money out of it, but do not tell people that, Senator Bullock—through you, Mr Acting Deputy President. Those are the sorts of advantages.

When it comes to regional universities, let me tell you our own recent experience of cross-fertilisation, happening now as a result of this new deregulated world. Muresk started the first ever agribusiness degree course in the 1970s. For various reasons I will not go into, it no is longer operating. It has burgeoned around Australia. Probably one of the most excellent courses of this type at the moment is run by Charles Sturt University at Wagga. As of February this year, the Wagga course—yep, you would not believe it; across state boundaries—run by Charles Sturt University is now being run at the Muresk Institute for Western Australian agribusiness and agriculture students. That is the sort of process we are going to see with deregulation. Why wouldn't we have the merging of international universities? Online opportunities are going to expand. People say to me, 'Fees are going to go up!' If you are a vendor of shoes in Manuka, and there are other shoe shops in Manuka, and if you wandered down there and said, 'I'm going to go into this market selling the same brands and I'm going to double the price of everyone else', how long do you reckon you will stay in the marketplace? Not very long at all.

Regional universities, contrary to what Senator Carr said, and my own experience bears this out, have tremendous opportunities. For example, in my own state it is in agriculture and mining. I was in Kalgoorlie the other day—Senator Bullock would know the excellence of the WA School of Mines. It is already attracting international students from everywhere: Africa, Asia, South America. That will only expand in a deregulated world because they can set those prices, along with those for Australian students. So the opportunities are boundless.

The cost of living in country towns is often less. Then there is the enjoyment of living. I asked veterinary students at Wagga, when I went to give the occasional address for their first graduating group, 'Wouldn't you prefer to be in Sydney?' They looked at me as if I were mad: 'Why would you want to be in Sydney when you can be in Wagga? The cost of living is cheaper and the quality of life is much better.' As we all know—and it does reflect a little on Senator Cameron's observations—a graduate is likely to earn $1 million more in their career than a nongraduate. Is having a loan to put yourself through university, which you start paying back only when you earn $50,000 a year—and you are going to earn $1 million more than you otherwise would—too big of an impost on a person? I do not think it is, particularly if that is available to every family across the horizon, including low-socioeconomic families. It is available to every student—students getting diplomas, advanced diplomas, pre-university degrees and degrees. What we want to see in the future is a better scheme—and it will come—for those going on to masters and higher degrees.

I am delighted that Senator Carr raised this issue. I have loved the contributions.