Cory Bernardi (SA, Australian Conservatives) Share this | Hansard source

In making a contribution to the debate on the Higher Education Support Legislation Amendment (Student Loan Sustainability) Bill 2018 I want to welcome the government's attention to the importance of reform in the higher education sector. I understand that this bill goes some way to reforming the HECS and FEE-HELP schemes, but there is a broader discussion and debate that we need to have in this place about the benefits of university education for a number of students. I recognise also that we've had the vocational education and training scheme, and there have been some significant reforms in that nature.

Our university system has become almost effectively a degree mill. That concerns me because there are many students who have the expectation placed upon them by society, their schools, their parents or themselves to get a degree from a university which doesn't equip them with a financially valuable skill when they graduate, some years down the track, indoctrinated in some respects by the university ethos and kudos, but they have a higher education scheme bill and are left pursuing rather menial tasks that are completely outside their training and education. That benefits no-one. The government, the public assume, by virtue of the fact that they fund it, will be accruing tens of billions of dollars worth of higher education debt, but much of it won't be repaid. As much as 25 per cent in some instances won't be repaid. We're talking about a significant amount of money—$15 billion, $16 billion or $20 billion over the next 10 years will never be repaid.

So I congratulate the government on their attempts at redressing some of the imbalances in the scheme, because, if you don't recognise that there's a problem and you don't try and fix it, you're never going to have a hope of improving the current situation. University education is not servicing all our students and our younger people as effectively as it should. Postgraduate outcomes are critically important. Meaningful reforms in this sector should incorporate a report and a very frank disclosure about how many graduates from a particular university, in a particular discipline, have obtained jobs within a certain time frame of graduating from that institution. It would produce some accountability. It would mean that universities don't just pick the cheapest degree to provide—let's say it's a law degree, for argument's sake—and graduate hundreds of students who all expect a glittering legal career and are unable to find work in that sector. That is but one example. We have numerous other examples in the sociology and social studies space. They have very little prospect of gaining meaningful employment outside of a tiny little cabal, which is not really adding to the productive nature of our society.

These things may be contentious. I don't think they are. I think many parents recognise it as common sense, and I know that many graduates lament the fact they have incurred a rather large and substantial debt and yet have no real meaningful employment prospects enhanced as a result of it.

There's also another gratuitous imbalance in the system, which I will be moving an amendment seeking to reform. That applies to the four private universities in this country: Bond University in Queensland, Torrens University in South Australia, Notre Dame University in Western Australia and New South Wales, and the University of Divinity, which is based in Melbourne. These four privately funded institutions not only don't benefit from taxpayer subsidies for each enrolment; the students who choose to go to these institutions are penalised for doing so. They're penalised with no real justification. The penalties are quite significant. Effectively, what it means is that, if they are accessing HELP fees to the tune of say $60,000 in order to get their educational qualification, the government slugs them with a 25 per cent loading on those fees simply because they've chosen not to pursue a publicly funded university place.

I understand this was introduced in around 2006 by the Howard government. In going back to understand why, I found very little rationale or explanation other than it was the vibe at the time that this should take place. Since then, I've had conversations with a number of individuals about it, and the rationale has moved down the path to, 'These are going to be accumulating higher HECS debts for individuals that are attending them'—HECS is my terminology; it's HELP and HECS now—'by virtue of the fact they're more expensive to go to, so the government will be financing a larger loan, so there should be a penalty.' This is a nonsensical argument, because it doesn't take into account the subsidies that go into universities already. It doesn't account for the fact that, for example, in Bond University a student can get through their degree in two years because they have an accelerated program that the student, who has learnt a financially valuable skill—I note in yesterday's Australian Financial Review that the private universities had higher satisfaction and better outcomes for job placement than most others—they will get into the workforce at an earlier stage and they will begin to be able to repay their debt at a later stage.

As for the concept that the fees, and hence the borrowings, attached to private institutions are somewhat higher, yes, the fees are higher, because there are no subsidies taking place there. There's not a $20,000- or $30,000-per-student subsidy that has been injected into the university to maintain the sandstone. These are privately funded institutions.

The government, might I also say, charges the interest rate that it determines applies to all student loans, irrespective of the amount. We know from media reports as well that there are students out there who have obtained hundreds of thousands of dollars in HECS debt and HELP debt by becoming perpetual students, and that, I'm sure, doesn't pass the commonsense test. What does pass the commonsense test, though, is for the government to effectively introduce a cap on HECS and slash outstanding HECS and HELP debt of, I think, $104,000, which is in this bill. It also entirely negates the justification for this loading on private universities. The loading on private university students was justified, as I said, because the fees they were going to be accumulating would be higher. Well, in the end, the only amount of borrowing that a student can undertake at any single time, with one or two exemptions—we understand that—is around $104,000. Whether you pay $60,000, $80,000 or $90,000 for your degree, or whether you do two degrees, whatever it is, the most you can get is $104,000 outside of the medical sciences. I have no dramas about a loading, perhaps, for private institutions in medical sciences. I don't think it should exist, but, if a degree at Bond University in medicine could cost upwards of $500,000, one has to question whether the taxpayer should be on the hook for that. That is a decision to be made. But the principle is the same. By capping the fees, you undermine the very argument for a 25 per cent loading.

In the interests of full disclosure, my son is a scholar at Bond University. This contribution to the debate is not driven by self-interest at all, apart from the fact that I pay his fees there. He's not using HELP or accessing HECS because we're very fortunate that there's no need for him to. But it was his enrolment there, the engagement with it and the discussions I had with him about this that marked the inequity of the system.

There is an attractiveness about the private university system for many students. I've talked about the accelerated education so you can actually do a degree in two years. You do three semesters per year, you have minimal breaks between them and there are three 14-week semesters rather than two 14-week semesters or thereabouts. I'm decidedly impressed with the commercial nature of it. They explore a great many things, but everything is oriented towards practical, real-world skills in the area in which they will graduate. If that is in law, they're practising their mooting skills, discussing real-life cases or assisting in particular areas. Everything I've learned from my son's explanations to me demonstrates that there is a truly valuable skill that is coming down the pipeline, rather than just theoretical knowledge—which has its place in higher education, in research and academia, but that's not what he was seeking from a university degree.

I understand it's the same at Torrens University. This is not an ideological bent. For those on the other side of the chamber who don't share my conservative leanings or perhaps my sense of fiscal responsibility, I make the point that Torrens University in South Australia is part of a global network of universities which, I think, was launched and certainly celebrated by no less a left-winger, if I can put it like that, than Bill Clinton.

Private universities have their place. They are just another option for children and students in our country to make a decision about, and I don't think they should be penalised by government simply for opting into a system that is not state sanctioned or state run. I've been on the record many times as saying that I think the university system is becoming a bit more of a closed shop, where freedom of speech, freedom of thought, freedom of ideas and the battle of ideas are no longer as relevant as they once were. It seems that few are willing to defend in this space what we have always tolerated or accepted. They're just students. They have differing views. But now we see students who were campaigning for the 'no' campaign being attacked and vilified simply for having that view. We have seen pro-life organisations on campus. We have seen pro-conservative organisations on campus. We've seen people penalised—and I just spoke about it in my podcast today—