Joe Ludwig (Queensland, Australian Labor Party, Manager of Opposition Business in the Senate) Share this | Link to this | Hansard source

My question is to Senator Brandis, the Minister representing the Minister for Education, Science and Training. Is the minister aware of the claim by the Minister for Education, Science and Training on The 7.30 Report last night about the HECS increase for accounting, economics and commerce students that ‘universities are not obliged to raise HECS fees after all’? Hasn’t Professor Gerard Sutton of the Vice-Chancellors’ Committee exposed this as a total nonsense today by saying ‘given the experience with flexible HECS, you would have to say the majority’ of universities will increase HECS fees? Isn’t it the case that, the last time the government increased HECS, all but one university passed on the increased rates, with the result that students took on an average increase in debt of $2,000 each? Why is the government trying to play a cynical smoke-and-mirrors trick with the community on increases in HECS fees?

George Brandis (Queensland, Liberal Party, Minister for the Arts and Sport) Share this | Link to this | Hansard source

I am aware of Ms Bishop’s remarks on The 7.30 Report last night, although I have not seen Professor Sutton’s remarks today. I can inform the honourable senator in relation to HECS places for accountancy that there will not necessarily be any reduction to overall funds available to universities for courses in accounting, administration, economics and commerce. The change to funding for accounting, administration, economics and commerce under the Commonwealth Grant Scheme is part of the broader Realising Our Potential package that will deliver an additional $1.7 billion to the higher education sector over the next four years, which includes a $557 million increase in funding under the scheme for many disciplines.

The simplified funding arrangements will give universities increased funding overall and greater flexibility to move their resources across disciplines. As part of the changes, funding arrangements for accounting, administration, economics and commerce will be aligned with law. This means that the maximum HECS fees for accounting and related disciplines will be raised to the same level as the fee for law. It will be a decision for each higher education provider whether to raise the student contributions for those disciplines, taking into account the overall benefits of the new funding arrangements. The higher education providers can reduce HECS.

The increase in the maximum student contributions for accounting and related disciplines reflects the considerable private return available to individuals studying in these fields over a lifetime and the commercial nature of these courses—as Senator Ludwig, a graduate of my own law school, the University of Queensland law school, would himself know. Within the University of Queensland, for example, the discipline of law and the disciplines of commerce, economics and business are taught in the same large faculty. Recent research estimates that there is an average lifetime gain of over $230,000 for business graduates compared with an average return for graduates across all disciplines of around $150,000. It could take about one extra year for a typical student to repay the HECS loan.

Any changes to student contributions will only affect students who commence studying at higher education providers after 1 January 2008. Students studying before this date will be able to continue under the existing arrangements until the end of 2012. There will be a transition fund to compensate higher education providers for students who continue under existing arrangements.

Joe Ludwig (Queensland, Australian Labor Party, Manager of Opposition Business in the Senate) Share this | Link to this | Hansard source

Mr President, I ask a supplementary question. I thank the minister for confirming that under the coalition government the fees will go up. Can the minister confirm that the budget cuts funding for accounting, economics and commerce students by $1,029 per year while at the same time increases HECS contributions for students in those courses by $1,215 per year? On top of the almost certain increase in HECS fees, doesn’t this show that the government is further shifting the cost of accounting, economics and commerce degrees onto students and doesn’t this fly in the face of the government’s new found commitment to higher education?

George Brandis (Queensland, Liberal Party, Minister for the Arts and Sport) Share this | Link to this | Hansard source

Perhaps Senator Ludwig misheard my answer. Not only did I not confirm that the HECS fees would rise; what I said was that they may fall. The HECS fees for the disciplines of commerce, economics, administration and business will be bracketed with the HECS fees at the level charged by the discipline of law just as those courses at most Australian universities, including our own, Senator Ludwig, are commonly now bracketed together with legal studies because of the close complementarities between the two.