Catryna Bilyk (Tasmania, Australian Labor Party) Share this | Link to this | Hansard source

I spoke earlier about this bill and I was interrupted. I was explaining to those on the government benches who were previously opposed to a price cap on VET fees. Minister Ryan, Birmingham and Morrison all came out strongly against the idea. Despite all the criticism from those opposite of Labor's price cap policy, these bills we are debating today propose three different price caps on VET FEE-HELP lines: $5000, $10,000 and $15,000. This is a backflip of such proportions that, seriously, it would make an Olympic gymnast proud.

Another welcome backflip by the government has been the provision of an ombudsman for the VET sector, something that Labor has been calling for over a long time. The Minister for Education and Training, Senator Birmingham, gave an undertaking a year ago that he would establish an ombudsman, but there was no provision for one in these bills when they were presented to the House. Many stakeholders supported the idea of an ombudsman through their responses to the VET FEE-HELP discussion paper, and it is pleasing to see that the government will finally move to amend their legislation in this place to provide for one. An ombudsman is a sensible, practical step to help students get redress for exploitation and unfair debts.

Labor is also pleased to see the government moving to implement a version of the transparency and reporting requirements that Labor moved in the House. This will allow information about the operation of the scheme to be released twice a year so that the public can scrutinise the effectiveness of what providers are doing and what is happening to taxpayers' money.

Labor has serious concerns about the government's draft eligible course list which were raised by stakeholders through the Senate inquiry. Submissions to the inquiry noted the simplistic methodology used to create the list. The government has based the list on state skills lists, which were never ever designed for this purpose. The requirement that the course be on two state lists has ruled ineligible many specialist courses that are only offered in one state. And there has been particular criticism from the arts and creative industries, as courses offered by some of our most respected public arts institutions, such as NIDA and the Australian Ballet School, have also been deemed ineligible. I would have thought that the government was actually trying to make some amends in the area of the arts following their disastrous cuts in regard to the arts funding area. There have been courses struck off the list that had been developed to meet industry need which have very high employment outcomes. While we are not voting on the course list today, I understand that my colleague in the House Kate Ellis has written to the minister, urging him to consult with industry on the eligible course list and address the concerns that have been raised.

Labor will be moving two amendments to these bills to address issues that were raised by the Senate inquiry. One of our amendments will allow the minister to grandfather VET FEE-HELP students beyond the end of 2017. The current provisions have the grandfathering abruptly ending at the end of 2017. There are a number of reasons why students may need to continue their study beyond the end of 2017. They might be studying in a course that goes for more than 12 months, they may be studying part-time or they may have suspended their studies taking time off because of illness or family responsibilities. There are currently 140,000 students, by the government's own estimate, who will need to be grandfathered so that they can finish their courses. The alternative for these students will be having to pay the full cost of their course up-front if they want to finish. Under our amendment, the grandfathering power is given to the minister so the extension does not provide an excuse for dodgy providers design on more students and charge inflated fees.

Labor's other amendment would exempt TAFEs from the proposed course restrictions and loan caps for another year until 2018, and this will allow the government time to strike a new funding deal with the states. The VET FEE-HELP problem applies overwhelmingly to the private sector. The following facts clearly demonstrate this. TAFEs have a much higher unit completion, on average 77 per cent compared to 59 per cent for private providers. TAFEs do not charge inflated fees for courses. The tuition fees for the most popular diplomas in 2015 are less than $6,000 at TAFE compared to over $18,000 with private providers. We know from evidence submitted to the Senate inquiry into these bills that the government has been aware for some time that there were problems with the VET FEE-HELP system. The Consumer Action Law Centre, the Australian Competition and Consumer Commission, the Australian Skills Quality Authority and the Department of Education and Training all gave evidence that they were either receiving or aware of complaints as early as 2014. During those years, the Abbott-Turnbull government has gone through five ministers and has been so consumed with their own internal factional squabbles that they failed to take action to address this problem.

This legislation has been rushed through parliament, but it is a rush that Liberals imposed on themselves because of their lack of action over the time that this problem was emerging. It has tied this government in knots and they have failed to undertake proper consultation on the reforms. If this government had acted sooner, they could have saved billions of dollars which could have been invested in apprenticeships and TAFE instead of been wasted on dodgy private providers.

While Labor appreciates the urgency with which these reforms need to be implemented, we are concerned that the government will face challenges in the timely implementation of the new scheme, given the rushed nature of their response. While these bills address the rorts from unscrupulous private VET providers, there is a parallel crisis in public vocational education brought on by this government's savage cuts. These reforms do nothing to restore the $2.75 billion the Liberals have ripped out of TAFEs, skills and apprenticeships. As a result of the Liberal cuts, there are 130,000 fewer apprentices. TAFE is the backbone of our apprenticeship system, yet the current Assistant Minister for Vocational Education and Skills, Ms Andrews, is questioning whether there is a need for new national partnership on skills—so much for jobs and growth.

The current partnership put in place by Labor expires in the middle of next year, and the government's failure to commit to a new national partnership is putting at risk over $500 million a year of Commonwealth support for TAFE and skills. Labor supports our public TAFE system. That is why we put forward a TAFE funding guarantee before the last election, but for some reason the Liberals have an ideological problem with TAFE. They fail to understand the important role that TAFE has in the provision of technical and professional skills for a strong, competitive economy. And, if they think the private sector is going to do a better job, they only need look at the problems that had to be addressed by the bills we are debating right now. What those opposite have demonstrated with both their cuts to skills and their glacier-like response to the rorting of the VET FEE-HELP system is that they simply do not care about vocational education and training. Only Labor has a commitment to a strong vocational education and training sector, with TAFE at the centre as a public provider. We have been leading the debate for some time on the response to the crisis in the VET sector caused by the rorting of the VET FEE-HELP scheme.

Now the government, after criticising Labor policies, have been dragged kicking and screaming once again to the realisation that our policies provide the best solution. I welcome the government's adoption of Labor policies, although with the thousands of students ripped off and billions of dollars wasted over the past couple of years while the government sat on their hands it really is a case of too little too late. I commend the bills and Labor's amendments to the Senate.

Pauline Hanson (Queensland, Pauline Hanson's One Nation Party) Share this | Link to this | Hansard source

I support the measures in this legislation. The proliferation of private colleges offering courses of suspect outcomes and suspect practices is long overdue for regulation. Those colleges are utilising millions of dollars in education funding when those funds are desperately required by institutions such as TAFE, which is underfunded but offering worthwhile educational courses. We need to keep these TAFE colleges in rural and regional areas. They are very necessary not only for our youth but also for other Australians in these areas. As I travel throughout Queensland I see that a lot of these TAFE colleges are closing down. It is not good for these areas, and we must ensure that TAFE colleges are kept open.

In the vocational education and training sector students are being offered iPads as inducement when they do not any hope of completion and no educational background to successfully complete simply to have student loans approved. We need to look at not only vocational education and training but also further education at university. Where are the degrees and the decent educational level required for people to go on to these courses? We are pushing people into further education when they do not have the academia or the ability to go on further. We should be encouraging people to go into apprenticeship schemes. Going to university and getting a degree is not the answer. For a lot of students who are finishing these courses there are no jobs.

We have to have a program that says, 'If you are going to have so many going through to do a course, whether it be in hairdressing or in some other profession, students have to know at the end of the day we have too many applying for these professions and there are no jobs to go to.' It is not being managed correctly or properly. Our kids are not being told and are not being put into the right courses. We have to get rid of this mentality that you must go on to higher education. At the end of the day, there have to be the jobs available.

The system was set up so that everyone wants to sign up all these kids to these loans. They give them iPads. They know they have no ability to actually go on and do these studies. The agents are scouring the unemployed on behalf of unscrupulous colleges to sign up students, knowing they have no hope of completion and, even further, no hope of even paying back those loans. This is another cost to the taxpayer. It is estimated that by 2025-26 we are going to be in debt by $185.2 billion. That is going to be 46.3 per cent of the nation's debt. This cannot happen. It cannot go on. It has to be reined in.

This legislation would stop the use of agents. A duty should be placed on colleges to assess further whether a potential student has the educational standard to commence the proposed course, the aptitude for the area of employment to follow the course and the likelihood of completing the course. It is like, 'Come on down! We've got something else for you.' That is what I am hearing. Examples are courses for IT, media, personal trainers, hairdressers, make-up artists et cetera where there are no positions on completion.

In total the VET debt is just over $6.064 billion in fees since 2009 to 2015. So it has grown from approximately $25 million to over $6 billion in a matter of six years. Between 2009 and 2015, students chose to pay approximately $21 million up-front. That represents a mere 0.35 per cent of the total student fees. They pay from day one. How much does a hairdresser make? The government must rein in that debt and ensure each student commits at least a small payment from the beginning of the course towards its repayment. Otherwise, people will continue to take worthless courses unless they know they will be liable to begin repaying their loan immediately. At the present repayments do not start until $54,000 and that is intended to be reduced to $52,000. How many hairdressers and make-up artists make that sort of money?

People have to start being responsible for their own actions, not the taxpayers covering this. I propose—and I will be moving an amendment on this—that from day one people start paying back their loans on a percentage. People should take some responsibility because too many do these courses when they have nothing else better to do with their time. If they do not have the qualifications they should not be doing it. They should be looking for other worthwhile jobs. Then they just walk away and it is not their responsibility. If you take this on, you do have a responsibility to pay back the taxpayer. That threshold must be reduced. People should be paying it back from day one from any income that they make. If they are not earning an income then it should come even from their welfare payments. It comes down to a responsibility. As I said before, by the year 2025-26 we will be in debt of $185.2 billion. We cannot afford it. If we do not start reining this in then, for those students who would be able to do these courses, we will not be able to assist them or fund them at all.

I will now go on to TAFE colleges. A TAFE course may cost $7,000, but I am advised that, for a comparable course, private educational colleges are charging anything between $15,000 and $18,000. Why the difference? Why are they charging so much in these private educational courses? That is another thing that needs to be investigated. People can make rational economic decisions if they know the cost of those decisions. People have to ensure that potential students understand the financial consequences of taking a student loan. It is up to the government to make sure of that; they have a responsibility to the taxpayer.

We are in so much debt in this country and at the moment we are paying $40 million a day in interest alone. If we expect to have decent health care, hospitals and schools in this nation then people who want to access taxpayer funded services must pay back the country and the taxpayer and be responsible for their own actions. As I said at the beginning in this debate, I do support the government and the measures in this legislation. But, as I said, I will be moving an amendment that the students start paying back their debts from day one.

Louise Pratt (WA, Australian Labor Party, Shadow Parliamentary Secretary for the Environment, Climate Change and Water) Share this | Link to this | Hansard source

I rise this morning to support the VET Student Loans Bill 2016 and related legislation. On this side of the chamber we do support the general direction of these bills, but—like with many of the important issues brought to this place by this government—sadly, once again, we see too little too late. We have seen far too little on this issue. For example, in Western Australia, in our home state, we have seen the biggest mining boom in generations, yet accompanying that was an absolute decline in training opportunities. We saw an absolute increase in dodgy private providers ripping off younger and older students, leaving them with massive debts. Now that the mining boom is over we are left with an economy that does not have the skills embedded right throughout the state economy in order to diversify. We have had people under financial stress in the boom and now in the decline they are left with debts instead of qualifications. It is an appalling situation.

Amazingly, the government has finally responded to the wreck that everyone else could see coming, and it has the gall to point to the highly-challenging implementation targets and rushed policies as evidence of its competency on these matters. It really is a shame. The truth, in my view, is that the government has struggled to grasp what is needed to ensure Australians have the very real opportunities they need to train for future market demands in our nation. We have seen five ministers in three years! What more evidence do we need to demonstrate this government's failure to deliver the training and apprenticeship opportunities and technical and vocational education that our nation needs? Where did the $2.75 billion ripped out of TAFE and vocational training actually go? The VET fee situation supposedly meant that students were cross-subsidising that withdrawal of money, but instead what we saw was a massive decline in quality outcomes for students. Why have we seen five ministers in such a short period of time? Is it they perhaps who need training? Why are industry stakeholders still unsure how these changes are going to be implemented in our nation? So much for effective consultation!

But all is not lost. As we all know, imitation is the best form of flattery. Finally this government has adopted some key policies Labor has been calling for which will be implemented in this legislation. The legislation will cap student loans to stop rip-offs; crack down on brokers; link publically funded courses to industry need and skills shortages; require providers to re-apply under new standards, so only high-quality providers can access the loan system; link funding to student progress and completion; and establish a VET loans ombudsman. All of these policies were called for by Labor and they have been copied from Labor. Funnily enough, all these policies all rejected by this government back in May.

So what are the future issues for our nation when it comes to education and training in the VET sector? We know that stakeholders have agreed that these reforms are urgently required. We also know that as a nation we are going to face incredibly significant challenges in transitioning into the new scheme, particularly given the proposed time frame that we have before us. We also know that the draft list of eligible courses has attracted significant criticism, particularly in relation to the performing arts and creative industry courses. This is an issue that has been raised with me by many stakeholders. I think it is a difficult issue because we do value the creative arts in our country and people do need to be able to access education and training. When you invest in the arts, there is an economic and social dividend, and it is one that sometimes our economy fails to count. So it is really important, when we look at the final eligible course list, that it is not part of these bills before us. The shadow minister has written to the minister about our concerns about this draft list. We need to continue to engage to ensure that people can access these courses into the future.

One of the key issues to note into the future is that, by restricting access to student loans, the bills are in fact significantly reducing investment in the vocational education system. Compared to the current system, we have $7 billion less being provided in student loans over the forward estimates, and $25 billion less over the decade. This makes the money that the coalition has already ripped out of vocational education and training all the more problematic.

I am concerned about the loan caps. While loan caps are really important, we do not want to see those replaced with significant increases in out-of-pocket costs for students. Unless other supports within our vocational education and training sector are adequate, those out-of-pocket costs are going to prevent students being able to access the education they want.

As a nation we also very much need a longer-term policy response regarding VET courses and TAFE—beyond the debate we are having today. We need to look at a quality national skills partnership. This is about the funding of TAFE and making sure TAFE has a very secure foothold in our nation. We cannot diversify the economy and we will not have the skills that our economy and community need without a quality TAFE sector. It has been of great concern to me how the proliferation of private providers—many of whom are of good quality but many of whom are not—have ripped away money from students and ripped away the reputation of what was a very important and effective sector. We know that TAFE funding expires in mid-2017. We know that the government is negotiating with the states. But what we need is a public commitment to replacing this agreement so that we can protect our TAFE sector.

This legislation also puts forward the establishment of an industry ombudsman, and that is a really important outcome. However, I am very concerned that, despite the passing of this legislation, many students will continue to be saddled with unfair debt because of the legacy of mismanagement of this issue. Providers have collapsed, and there is no entity for students who have such a debt, for courses they have not received, that they can pass that debt on to or settle it with. For us this is going to remain a really critical policy issue. I find it appalling that students who have been trying to advance their opportunities in the economy and contribute to the community, instead of being on a pathway to improve their lives, have been left without the qualifications they desire. In some cases they have done dodgy courses that have left them without the skills they wanted, and they have been saddled with large debts.

It is a pretty tough environment for young Australians at the moment when it comes to the employment market. In my own home state of Western Australia, youth unemployment is increasing. We are asking students to spend their time studying, engaging in the vocational education and training sector, so that we can diversify our economy and so that they have an opportunity to improve their skills and help us diversify the economy. But under this government there has been a complete abandonment of those students who are trying to do the right thing.

On the other hand, I have been really pleased to see, coming from this side of the parliament, the commitment to greater integrity when it comes to these issues. We have put forward an integrity package to stop the massive waste of taxpayers' money, to prevent price-gouging of students and to improve training outcomes. That is our vision that we put forward some time ago, and the government is only now playing catch-up on that initiative.

Last May, in Labor's budget reply speech that Bill Shorten gave in the parliament, MPs were told that under the Liberals the VET FEE-HELP loan scheme had escalated from $699 million in 2013 to $1.7 billion in 2014. That was a massive escalation when we already knew that there were problems. We needed intervention sooner, but I guess I am pleased that we have the opportunity to pass this legislation before the end of the sitting year this week, because it is urgent. But the priorities of this government are absolutely galling when you look at the fact that it prioritises the passing of the ABCC legislation over and above an important bill like this one. We have thousands of students in our country who are absolutely loaded up with a massive debt for irrelevant qualifications sold to them by dodgy providers—all of that at great cost to the taxpayer as well as to these students. It is these students who are paying the price for the government's mismanagement.

The real question is: what is the government going to do in the long term about the debt that these students have been saddled with in exchange for these dodgy qualifications? Do we really expect them to pay back that money, for qualifications they have not received? We have seen students ripped off by unscrupulous colleges and dodgy providers, with taxpayers being forced to pick up the tab. Some colleges are costing taxpayers more than $1 million in VET FEE-HELP loans to produce a single graduate. It has been an appalling situation. We have seen students at private colleges paying fees of up to $32,000 for things like salon management, $29,000 for project management and $28,000 for marketing diplomas. It is appalling to see these organisations, private companies, that have set up some of these dodgy training providers pocketing massive profits at the expense of students. I was particularly dismayed to see the likes of John Dawkins involved in some of these dodgy practices, particularly given his history in the higher education sector.

We know that in New South Wales you can get an equivalent government provided course in its TAFE sector for things like salon management, project management and marketing diplomas for a little over $6,000. That is what we should be striving for: cost-effective, government provided courses that have a modest fee attached to them that mean that people can get quality education that is matched to the needs of local industry and the community. We do not want to see thousands of Australian students being loaded up with this massive debt but not the qualification they need to find a job.

We also know that in this environment many providers under this scheme preyed on students in appalling ways. In 2014, we saw that the largest private training colleges in Australia were paid $90 million in government subsidies, and yet less than five per cent of their students graduated. That was certainly of great concern and outrage from our shadow higher education minister, at the time, Senator Kim Carr. We saw just 4,181 students at an average cost of more than $200,000 per student. We are now asking questions in this parliament about where that money went. We need to make sure that now and into the future we can stop this terrible waste of taxpayers' money and, indeed, the exploitation of students. What we see here are massive subsidies from the taxpayers to these companies but, at the same time, students being saddled with massive debt. It is extraordinary when you think about where all the money has gone.

It is time to stop the terrible exploitation of students. We need integrity in our system and we need to continue to clean out dodgy providers who have been ripping off Australians, both students and taxpayers, for too long. We have had brokers who have preyed on students, offered free computers and laptops, signed them up to expensive courses and made taxpayers in our country pay the bill. It is why we believe that it is reasonable to put limits on course loans in same way that limits are already in place for university degrees, as was put forward by Sharon Bird, who was the shadow vocational education minister when Labor put forward its election policy earlier this year. It is about Labor putting the interests of students and taxpayers first over and above the interests of companies and other vested interests. We know that under the coalition there has been one winner and that has been unscrupulous colleges. While that was happening, apprenticeship numbers plummeted, all because Malcolm Turnbull slashed a billion dollars from apprenticeship support and programs. We know that this masked massive cuts in the VET FEE-HELP scheme and it also masked massive cuts from our vocational education and training sector. We need to continue to rein in taxpayer subsidies to private companies and restore integrity to our vocational education and training sector. It is a critically important thing to do.

What we in the Labor Party want to see is caring for people and their jobs rather than corporate profits in vocational education training companies. If you look at the government's so-called accomplishments in this portfolio, we have seen the graduation rate fall. In the largest 10 private providers, the graduation rate was under five per cent. That represented over $900 million in federal money. We have seen students tricked into racking up massive debts with little hope of finding a job, we have seen an explosion in short course and online courses that are not worth a cracker, we have seen an estimated 40 per cent of VET FEE-HELP loans never being repaid and much of this is because of their inaction.

We know that in this place we have heard all of this before. But you will continue to hear this over and over again from this side of the chamber because we care about people, we care about jobs and we care about quality education and training. In the end, this is about ensuring that all Australians have an opportunity to gain access to quality, market-relevant education and training. We need trust and confidence that training is worth something and that it is affordable. Thank you.

David Leyonhjelm (NSW, Liberal Democratic Party) Share this | Link to this | Hansard source

I rise to speak on the VET Student Loans Bill 2016, the VET Student Loans (Consequential Amendments and Transitional Provisions) Bill 2016 and the VET Student Loans (Charges) Bill 2016.

These bills restrict the dollar amount of student loans for vocational education and training and restrict the number of loans that will be issued. These loans are extremely concessional, and the Liberal Democrats believe they promote bad decisions and unfairly burden the taxpayer. For that reason, I will support these bills but I do so reluctantly. The bills restrict the dollar amount and the number of loans in the worst possible way. They restrict the dollar amount of loans by authorising bureaucrats to set caps based on the assumption that bureaucrats know the correct price for a course to become a pilot, mechanic, florist or winemaker. These bills restrict the number of loans that will be issued by empowering bureaucrats to select the courses that can come with concessional loans, by imposing taxes on private providers and by banning brokers and agents from providing information to students on student loans. Unsurprisingly, this bureaucratic approach will add $45 million to the costs of the education bureaucracy by 2020.

It would be far better to restrict the dollar amount and number of loans by making them less concessional so that people put serious thought into taking out a loan. This would mean some decided against taking out a loan, while providers would compete for price-conscious students by keeping their fees low. A real interest rate should be imposed on student loans. And you should have to start repaying your loan once your income exceeds the minimum wage rather than the current threshold of $52,000. Your minimum repayments should be a reasonable share of your income rather than the current level of two per cent. And debts should be repaid not just when you leave the country, but also when you die with an estate. These options were not properly explored in the previous parliament and are completely untested in this parliament. These bills will save taxpayers money so I support them, but we could do a great deal better.

Helen Polley (Tasmania, Australian Labor Party, Shadow Parliamentary Secretary for Aged Care) Share this | Link to this | Hansard source

I rise today to speak on the VET Student Loans Bill 2016 and related bills. I start by getting right to the point. Labor supports the bills in the Senate. We agree to support government amendments to the bills to provide for the establishment of a VET ombudsman proposed by Labor in the other place, increase transparency and reporting requirements proposed by Labor in the other place, and improve the regulation of marketing practices and the broker ban. We also agree to amendments to the bills: firstly, to give the minister the power to grandfather the VET FEE-HELP students beyond the end of 2017; and, secondly, exempt TAFEs from course restrictions and loan caps until the end of 2017, to allow time for the next skills national partnership to be finalised.

Labor has made it clear that it will see these reforms as long overdue and necessary to end the appalling rorting of the scheme that has been allowed to occur. We are pleased to see that the Turnbull government is finally prepared to come to the table and take some action on this issue, which has been growing and continually ignored under their watch. We on this side of the chamber are pleased that Minister Birmingham has agreed to several of Labor's proposed amendments and we do not intend to delay passage of the legislation through the parliament. But their tardiness in dealing with this issue is not unfamiliar. They ignore, they dither, they shift the blame and sometimes, if the problem is bad enough, they jump onboard—like they have with these bills—and try to take credit for Labor's policy.

When it comes to these bills today the government is making a habit of copying Labor's policies. In May the Liberals were falling over themselves to criticise Labor's policy proposal. Today they are trying to take credit for it. Unfortunately, these changes are too little too late. But I guess it is better late than never. We should have seen legislation to improve VET FEE-HELP before the parliament a year ago, and I remain deeply concerned about the consequences to the vocational education sector if these measures are not correctly implemented.

Thanks to this very mediocre government, today, we are now considering rushed reforms years too late. Hopefully, the government will finally come to the table to sign and get serious about fundamental reform and proper protection for students. Over the last three years the Liberals have shown they simply do not care about technical and vocational education or TAFE. There is clear evidence from the Senate inquiry into these bills that shows problems with VET FEE-HELP emerged in 2014 and that the government knew about them.

That was three years ago. But no proper action was taken before the portfolio had been tossed around between five ministers, no-one having their feet under the table long enough to read their briefs. If the government had done its job and acted sooner, billions of dollars—and I mean billions not millions—could have been invested into apprenticeships and TAFE instead of being wasted on dodgy providers. Instead, the government sat on their hands while the quality of training and courses declined. Fees have skyrocketed and students have been squeezed out of quality TAFEs and lured away by far too many shonks. The Senate inquiry into the future of our aged-care workforce has recently heard about the detrimental impact this is having on the aged-care sector. We have a workforce shortage and quality of care is spiralling.

Labor knows that reform is long overdue and urgent, but the reality is that the bills before the Senate today are only one part of the solution. The proposed changes do nothing to turn around the decline and crisis within our public TAFE system. In fact, from the middle of next year, there is nothing in this government's budget to continue the national partnership that funds TAFE and skills, nothing whatsoever. On all fronts, the government has been asleep at the wheel. This portfolio has had five ministers in three years. And there will probably be another one when Mr Turnbull does his reshuffle after we get out of parliament. There is nothing in them to boost apprenticeships—in fact, they have done the opposite and cut 128,000 apprentice places.

Whilst we support the thrust of these bills, the government has failed to consult properly on the implementation of these changes and the time frame for implementation they have set themselves is overly ambitious and seemingly rushed. We will be watching closely to make sure the rules and determinations made by the minister are fair and effective, holding the government to account as these changes are implemented.

I move now to the government's amendment in the Senate. Labor has been calling for an ombudsman for a long time and has moved amendments in the House to establish one. Almost a year ago in the Senate the minister, Simon Birmingham, gave an undertaking that he would establish one, but when these bills were presented to the House there was no provision for an ombudsman. That is a pretty mediocre government, I have to say. An ombudsman is a practical way to help those students who have been ripped off and left with huge debts and nothing to show for them.

Senator McKenzie interjecting—

That is another interjection from another mediocre senator. The least we can do is make sure there is help in this place so that these students can get their money back. Labor will continue to hold the government to account, to make sure the other legislative changes needed—to establish an ombudsman with the right powers to protect students—are brought forward by the government with urgency.

We are also very pleased that the government is bringing forward a version of transparency and reporting amendments moved by Labor in the House of Representatives. The amendment will make sure that the VET FEE-HELP debacle can never happen again. Even if the minister has dropped the ball again, or is likely to drop the ball again—as the government has done over the last few years—information about the operation of the scheme will be made public twice a year, so we will be able to keep a close eye on what the providers are doing. This is a sensible amendment, and Labor is pleased the government has decided to support it.

We also welcome the changes the government is bringing forward in light of the Senate inquiry findings to strengthen the regulation of marketing practices and the banning of brokers. The inquiry heard disturbing evidence about the risks of exploitative in-house marketing practices at training organisations and about brokers finding ways to get around the proposed ban. This must be stopped, and we will support the government in stopping it. The details will be in ministerial rules yet to be released, but Labor's position is clear: we want brokers to be banned and dodgy marketing practices to be stamped out. We will be watching closely to make sure the minister's rules are thorough and effective in stamping out rorts and shonks.

In light of the Senate inquiry into these bills, Labor is moving two further amendments in the Senate: (1) allowing the minister to grandfather VET FEE-HELP students past the end of 2017, which is very important; and (2) exempting TAFEs from the proposed course restrictions and loan caps for one year, until 2018. Over 140,000 students will need to be grandfathered in the VET FEE-HELP scheme next year so that they can finish their courses. It stands to reason that many of these students will not finish their studies by the end of 2017, when the grandfathering abruptly ends. The impact of this dead stop to grandfathering at the end of 2017 will be huge for students. They will be faced with having to pay the full cost of their course fees up-front if they want to finish. This is completely unfair, and this is set to be yet another wave of VET students that the system will turn into victims through no fault of their own. It is very concerning that the minister has not provided anything in these bills to help these students when it is abundantly clear tens of thousands of students will be put in this position. Labor is moving these amendments because we want to protect students. It is wrong that students are again coming last in the debate, and students deserve to know that, when they start their studies next year, they will be able to afford to finish them.

TAFE is the backbone of the system and, along with innocent students, it has suffered the most in recent years from Liberal cuts and mismanagement at a state and federal level. The national partnership on skills, which funds TAFE, is set to end in the middle of next year, but the government still has not committed to replacing it at all. This uncertainty is crippling for TAFE and TAFE students. That is why we are moving an amendment to exempt TAFE from the eligible course list and the loan caps for one year, into 2017. I cannot stress any more in this chamber today the urgency of these two amendments, supported by the government, in the interest of TAFE and, in particular, those students.

In recent weeks, the Assistant Minister for Vocational Education and Skills, the member for McPherson, questioned whether the national partnership on skills was even needed in the future. This is deeply concerning. The current national partnership, put in place by Labor, expires in the middle of next year. Labor has been absolutely clear: we back public TAFE. That is why we took a TAFE funding guarantee to the last election. TAFE is the backbone of our apprenticeship system, but the Liberals—just as they do on so many issues—revert back to their DNA, where they would do anything but support TAFE. It is time the Liberals joined us in backing TAFE. I urge the minister and those on the other side of the chamber to support our amendments so that we can move forward and so that there is certainty given to all of those TAFE students who will live with uncertainty until these bills are passed. I commend these bills and our amendments to the chamber.

Stirling Griff (SA, Nick Xenophon Team) Share this | Link to this | Hansard source

I rise to briefly speak to the VET Student Loans Bill 2016 and related bills. This package of reforms is aimed at scrapping the existing VET FEE-HELP program and introducing, in its place, a sustainable loans program. According to the Minister for Education and Training, these reforms will deliver an estimated reduction in total outstanding HELP debt of more than $7 billion across forward estimates, and $25 billion over the next 10 years. This is a very significant budget saving. But, given that these reforms are necessary due to the mass rorting of the current system, you have to ask why absolutely nothing has been done since the last raft of reforms in 2012.

Many billions of dollars of taxpayer money has been wasted due to inaction from both Liberal and Labor governments—particularly over the last four years. Looking at figures provided by the Minister for Education and Training, the scheme blew out from costing $325 million in 2012 to costing a staggering $1.8 billion in 2014 and an even more mind-blowing $2.9 billion in 2015. What will 2016 show? Over the same time, student numbers jumped by almost 400 per cent, student fees doubled and student loans increased by a whopping 792 per cent. When we go back just a few years earlier and compare the number of students accessing VET FEE-HELP then to the number accessing it in 2015, we see a jump of 5,000 per cent. That is an increase in student numbers from just over 5,000 to 272,000.

There is absolutely no question that much of this increase—and the resultant cost to taxpayers—is due to wholesale rorting by unscrupulous training providers and brokers. This certainly has to stop. That is, of course, the reason for the bills, but it does not excuse this government's failure to address the wholesale rorting sooner. Another result of this rorting is that many students are now left with significant debts which will, in many cases, probably never be repaid. Some were signed up for thousands of dollars of loans for courses they did not need or would never complete. Some deceitful providers and brokers even signed up Indigenous Australians in remote communities, elderly people living in retirement villages and people with disabilities—sometimes without their knowledge. Why was the government asleep at the wheel with this issue? Why did the Department of Education and Training not have effective auditing in place? Does it now truly have effective auditing in place?

Vocational education and training is pivotal to ensuring effective employment outcomes and qualifications for students. Vocational education and training must take into account the future needs of our economy. According to government, under the new scheme course eligibility will be focused on courses that have a high national priority, meet industry standards, contribute to addressing skill shortages and align with strong employment outcomes. The minister will have the power to approve and/or change the course list through legislative instrument.

The Senate Standing Committee on Education and Employment has urged the government to give consideration to expanding the number of approved courses where sufficient justification is provided. It would like to see course eligibility expanded to include areas where there are skills shortages and a need to provide specialist training, always ensuring courses align with strong employment outcomes. These recommendations are consistent with the views expressed by the majority of stakeholders who provided evidence during the committee's inquiry process, and the stakeholders that I and my colleagues have met with individually.

During my briefings with the government, I sought feedback in relation to the rationale behind all of the courses the government proposes to cut from the eligible course list. According to the information provided to me by the minister's office, 506 courses have been superseded and deleted; 364 courses have been superseded but are equivalent to a current course; 1,468 courses have been superseded, with no equivalent current course; and 478 current courses have been excluded on the basis that they do not meet the new criteria. To meet the new criteria, courses must be on at least two state and territory skills lists or be required for specific licensing requirements or be STEM related—that is, science, technology, engineering and mathematics related. The government has justified the criteria relating to the two states' skills lists on the basis that there are a few areas where two states would not share the same industry needs. For example, in my home state of South Australia, if South Australia requires particular skills in ageing, the same is likely to be true for Tasmania or another state. Equally, if Western Australia requires specialised mining skills, Queensland is likely to require them as well. The fact that the addition and/or removal of eligible courses will be dealt with by way of regulation and therefore be subject to disallowance should, according to government, assist in ensuring appropriate course listing and funding.

I also note that the government has adopted the committee's recommendations to establish a VET ombudsman. This is certainly a welcome development and should provide further recourse for students in terms of resolving disputes that arise under the existing scheme as well as the new scheme. It should also provide an opportunity for ongoing reviews and, importantly, public disclosure of information relating to the operation of the VET student loans program.

At this stage I would like to note two concerns around the proposed time frames that apply under the main bill. The first is in relation to students. As we know, the VET FEE-HELP scheme ceases on 31 December this year, and those students that are currently receiving VET FEE-HELP loans will fortunately have access to grandfathering arrangements for a further 12 months. Students undertaking eligible courses under the new scheme will be able to access it from 1 January 2017. The obvious problem with this is that we have somewhat tight timing, which will be very difficult for some students, who will be caught by the changes because they have to deal with things over the coming four or so weeks. This is very much a tough ask, and we look forward to hearing from the minister how the department intends to effectively communicate with students.

The second concern relates to TAFEs, publicly owned RTOs and Australian universities that are approved VET FEE-HELP providers. Whilst these providers will not be required to apply for approval under the new scheme, the scheme timing will still impact them and their students. Indeed, TAFE has sought a further 12-month exemption from the new scheme in order to ensure a smooth transition and to make sure the 140,000 students currently receiving VET FEE-HELP are able to move to the new scheme without disruption. This would of course mean exempting TAFEs from the proposed eligible course list and loan caps for a further 12 months. Given that TAFEs make up around 15 per cent of student loans, there is certainly some merit in this position, and my colleagues were all supportive of the amendments proposed by the opposition, provided that TAFEs are subject to appropriate transparency and accountability measures, which we also considered to be extremely important.

It is also worth noting that the same sorts of concessions have been sought from other providers and, again, we were keen to hear from government in relation to any concessions that could have been provided to them, particularly given the dire ramifications that many of them are now facing. Of course, we know that there is no prospect of any of the amendments or concessions I just mentioned getting up, because the government and the opposition, who are equally responsible for the rorting mess, have come to a cosy arrangement to let the bills go through really without any significant change. Neither want to take responsibility for it; instead, they are only interested in pointing the finger and laying blame at each other's feet. This is an absolute disgrace that will be to the detriment of tens of thousands of students.

Unlike the government and the opposition, my colleagues and I remain committed to a considered debate on a later start date to ensure, as far as possible, that students in particular are not adversely impacted by the government's proposed changes. As such, I foreshadow that I will be moving an amendment to postpone the implementation date of the scheme, something that the government or the opposition should have done themselves. I urge the opposition to put aside the petty politicking and support this amendment for the sake of these students. Really, there is no point standing back after the fact saying, 'I told you so' when you have the opportunity to fend off that threat right now.

There is absolutely no question that reform in this space is well overdue. The fact that the existing scheme has blown out to a mind-boggling $2.9 billion because the government has been asleep at the wheel is evidence enough of this. There are some key elements of the new scheme that will go a long way towards providing value for money for students and taxpayers alike, and stamping out the shonky practices of dodgy training providers and brokers is extremely important. But we must ensure that these changes do not come at the expense of community and industry needs and potential employment outcomes. Similarly, we must ensure the changes do not come at the expense of those course providers that continue to do the right thing, of which there are many. There also needs to be an emphasis on appropriate reporting and transparency to ensure any identified issues are addressed sooner rather than later.

In closing, again, I wish to place on the public record our disappointment that the government and the opposition have seen fit to do a deal that effectively constrains any sort of worthwhile debate and further changes. Both have the opportunity now to support the amendment that I will be moving shortly and ensure that the scheme is not a complete disaster. If this amendment is not supported, there is absolutely no doubt that innocent training providers will hit the wall; their businesses will collapse, and the tens of thousands of students they enrol will be left significantly out of pocket.

Deborah O'Neill (NSW, Australian Labor Party) Share this | Link to this | Hansard source

I rise to put remarks on the record regarding the VET sector and these important pieces of legislation that go some way to cleaning up the mess that is currently the state of the nation with regard to vocational education and training.

In principle Labor supports these bills as being necessary but long overdue. It has taken the government far too long to get to this point, and still the legislation continues to raise questions and ignore issues. We understand the urgency, but had they been doing their job the government would not find themselves in this position today. Had this government got its act together sooner and listened to what Labor has been saying for some time now, the public purse would be hundreds of millions of dollars better off. Instead, that money has been wasted and has found its way into the pockets of some unprincipled, ruthless and deceitful private providers—or perhaps profiteers might be a better way to describe them and their practices.

I do not wish to extend the debate unnecessarily, and I know that many have put on the record the scale of the problem. But what I cannot for the life of me understand is why this government has consistently adopted a careless, cavalier and incompetent approach to the vocational education and training sector, given that it is absolutely vital to our economic success and the prosperity of the nation. Under this government, VET policy development has lacked continuity. There have been multiple changes in ministerial responsibility. There has been no sense of direction or anything that would remotely suggest that somewhere somebody in the government was engaged in some strategic thinking around this vital and essential part of how we are going to continually transform our capacity as a nation, economically and in terms of our work participation capacity.

Instead of turning around to dodgy private providers and saying 'Wait a minute: what about student outcomes? What about ensuring high-quality teaching and learning experiences? What about completion rates? What about linking courses to the needs of local and regional economies? What about accountability and transparency? What about value for the taxpayers' dollars?' this government did nothing; they just let it continue. The media has been full of stories about rip-offs, wasted money, poorly thought through courses, a lack of transparency and accountability, and we have seen a very flat-footed government in response.

The scale and the depth of the problem is also well documented in the CEDA report—the recent report by the Committee for Economic Development of Australia—titled VET: securing skills for growth 2016. It claimed that while the VET system in Australia is a fundamental part of our economy it is under very significant threat. That is the context in which this legislation is arriving and why Labor does not seek to delay any further. This is a small change amongst a raft of changes that need to occur to genuinely maximise the value of our investment in the vocational education and training sector. The CEDA report catalogues a VET system that is blighted by drastic reductions in enrolment. It identifies a system in which accountability, transparency and regulation are weak. There is within the system a deep anxiety among providers as to the future of VET funding. They argue that the entire vocational education and training sector system has been so undermined that it is in an extremely parlous state. The CEDA report recommends a comprehensive national review of the sector with discussions within COAG designed to help reach national partnership agreements. It adds even more weight to the reports that have been prepared by the education and employment committee here in the Senate as well as interest that has come from the House.

Sadly, though, we are in a position where there remains a major gap in the bill, and there is no redress for the many students who have been the innocent victims of dodgy VET providers and who now find themselves thousands of dollars in debt, having signed up for third-rate, badly constructed and poorly delivered courses that did absolutely nothing to help them get into employment. That is an area that certainly needs some further attention.

As a senator for New South Wales I also want to put on the record how valuable TAFE is and what a critical part it needs to have in the conversation going forward. To take the example of one small section of New South Wales as a test case—TAFE New South Wales in the Hunter—in the last period the state government has seen a real decline in funding of TAFE. The outcome there has been the loss of 120 permanent and support staff, with of course a massive economic on-flow, and enrolments are down by approximately 60 per cent. There has been a reduction in the variety of courses offered, significant fee increases and threats to the viability of TAFE centres in places such as Belmont, Glendale, Newcastle, Hamilton and Cessnock. And on the central coast there has been investment over many years of forward-looking governments, particularly state Labor, investing in Wyong TAFE, putting in wonderful facilities for hospitality, only to have the course capacity completely removed. So, these resources are going to waste while young people are desperate to get the training they need to get into a profession that is actually growing on the coast—this complete mismatch.

This is the scale of the problem. When we talk about it here as a bill, it is an abstract concept, but in reality it is people's lives that are being put on hold or delayed indefinitely because of a failure to have proper planning and proper leadership from this government. The Liberal Party talks about managing money. Well, they have clearly showed by the way they have managed this that they have not done that. The other thing is that they are advocates of a market based economy. Now, a market based system is not going to work in rural and regional New South Wales or in any rural or regional area. It cannot have the same dynamic or scale that it does in metropolitan and urban centres. Rural and regional centres are bound to have small student enrolments. We need to make sure that providers understand that this is part of dealing equitably with this, of giving Australians an opportunity, close to where they live, to get a future. Market forces are determining what courses are offered based far too much on delivery costs. The inevitable outcome is that attaching a financial cost to offering a particular course means that in rural areas, where there are small numbers of students, those students will never ever get the training and the access that they need. That problem is being exacerbated by the failure of this government to provide ubiquitous access to the technology of the 21st century—the NBN—to all people across this country. It would have been delivered pretty much across Australia by now had Labor continued with the rollout. So, we are seeing the exacerbation of a lack of access to education for people in regional areas and across this nation.

In closing, can I say that the Prime Minister cannot continue to tour, and to undertake appearances at media studios, sloganeering about an innovative Australia while his government's policy in the VET area has determined that it should shrink—that it should shut down. How is it possible to retain any credibility whatsoever by simply sitting back and trotting out platitudes, while all around him the system that educates the nation is plunging into crisis more deeply every day? The task is clear: we must restore the integrity of a system that has been plagued by scandal. We must invest in the education and training that our economy and our nation need as we work towards a progressive, dynamic and innovative 21st-century Australia. Can I suggest that, instead of providing $50 billion to provide tax cuts to multinational businesses, this government consider re-investing in our nation's future by committing themselves unequivocally to supporting education and training. If the government is interested in going down that path, Labor stands ready to listen.

Skye Kakoschke-Moore (SA, Nick Xenophon Team) Share this | Link to this | Hansard source

My colleague Stirling Griff has already outlined many of the concerns the Nick Xenophon Team has about this bill; concerns which have grown over the past few weeks since the bill was first due to come before the Senate. But I couldn't not make my own contribution, given the impact these reforms could have on important sectors which I hope to help advance during my term. These are sectors which I do not want to see diminished. The VET Student Loans reforms before us have been described as 'bungled and rushed,' and, 'inequitable, discriminating against women and disadvantaged groups, and in complete contrast to the government's innovation agenda'. If these descriptions are true, then these reforms have gone far beyond what was needed to help stop the rorting of VET-FEE HELP, and instead seem like a savings measure which will be to the detriment of all Australians.

Senator Griff has summarised these concerns and outlined the need for a delay to the commencement date of the reforms. I find it hard to believe that, with just four weeks left before the new scheme is set to start, there is sufficient time for applications to be submitted and processed, for course information to be issued, for an opportunity for students and training providers to actually plan for 2017, and so on. It seems that this will be a logistical nightmare, particularly for the Department of Education—the same department which did not pick up that some providers went from loans of $200,000 to $2 million, almost overnight. Even if the department can work through the enormous administration task, the scheme remains flawed. I pause here to note that these flaws have been raised by the opposition leader, Bill Shorten, directly with Prime Minister Turnbull. Yet we stand here today knowing that this legislation will still pass with minor amendments—because the major parties have done a deal. Rather than act to help prevent a flawed scheme from being included, it seems Labor consider it sufficient to note the issues and then take a step back, as if that will somehow get them off the hook if and when the problems materialise in the future. The provisional approval process, completion rates based on incorrect data, lack of guarantee of enrolment beyond 30 June 2017, loan caps which are inappropriate for adequate course delivery, and important courses omitted from the eligible course list are just some of the notable flaws.

Turning now to the course list, I will touch on a couple of areas which will be disadvantaged due to the omission of courses—courses producing graduates who are currently employed at the coalface of mental health: addiction treatment providers, and those working with victims of domestic violence and sexual abuse, with Aboriginal and Torres Strait Islander populations in prison, and with returned veterans, as well as with refugees suffering PTSD. Courses related to these areas are not on the list. Despite the government's commitment in these crucial spaces, it has omitted courses that are having transformational outcomes; not just for the people with whom they work but also for the graduates themselves. Graduates of these courses often come from disadvantaged backgrounds, and are entering the workforce—sometimes after long-term unemployment—by having overcome significant hurdles, making a positive impact on the lives of other Australians.

Let me give you some examples, Acting Deputy President Reynolds. Sandrine works with people with acquired brain injuries in the Community Re-entry Program at Flinders University in South Australia. She was previously unemployed and is now working in addition to undertaking further study in a Masters of Counselling and Psychotherapy. Bek works as an art therapist in the Community Re-entry Program, which is for people with brain injuries, and as a private practitioner with people with complex mental health conditions. She has had recent experience with breast cancer, and reports that art therapy helped her to cope and that it is helping other cancer patients, too. Janet works at the repatriation hospital, providing art therapy for people with persistent, long-term mental health conditions. She has a history of mental health issues herself and, in addition to helping others, it helps her function. She was previously long-term unemployed. Alison provides art therapy services to clients of two national employer assistance programs. She is supporting her husband, who has a disability and is on a disability support pension. I could go on and on, but I think the point is already obvious: despite these outcomes, courses including art therapy and transpersonal counselling are not on the list.

Recognition of art therapy around the world as a unique and valuable field in the healthcare arena is growing. It is practised in a variety of settings, from mental health clinics to schools, prisons and senior living centres. In the US, art therapists have become commonplace in veterans' hospitals and medical centres. In the UK, arts programs are routinely integrated into healthcare programs. In my home state of South Australia, one training provider, the IKON Institute of Australia, will cease to be able to operate if the proposed course list comes into effect. A full-time and contractor workforce of around 50 people will no longer have employment. And there are many more examples of training providers expecting to close as a result of these reforms. IKON was one of the first 20 VET-FEE HELP providers in Australia. It has an impeccable history with zero non-compliances. Its statistics show that 87 per cent of IKON graduates have attained employment. Significantly, 88 per cent of IKON students are female. This reflects the community service and health sectors, of which females comprise 68 per cent and 77 per cent respectively, according to the national Workplace Gender Equality Agency.

The current course list only covers eight health and 13 community service qualifications—that is six per cent of the 347 qualifications. There are no accredited training courses for helping professions, but there are 157 qualifications in the engineering and manufacturing fields, which are male-dominated sectors. Also missing are all the vocational performance-skills-oriented courses such as dancing and acting. The government has shown a clear lack of understanding of the importance of vocational training, of face-to-face learning and of regular practice in small classes in developing creative arts students. There is also a lack of understanding, again, that not all students need a university course or are even suited to university teaching and learning methods.

By leaving these courses off the list, the government has created fee barriers that will deter students from different cultural and economic backgrounds from accessing training. Elite training institutions, such as NIDA and the Western Australian Academy of Performing Arts, deliver vocational training, are responsible trainers of artist talent and are valued by the sector. Much like the helping professions that will be impacted as I have already outlined, the negative impact on arts training is occurring because the selection criteria used to determine the eligible course list are flawed.

The government has chosen to restrict the course list to courses that are on at least two state and territory training subsidy lists or are STEM related. This method relies on skills shortage lists and employment measures that do not take into account the characteristics of arts and employment. They do not seem to factor in future needs or developing treatment methods, such as art therapy, appropriately. The Department of Communications and the Arts was apparently not consulted.

The Department of Employment's statistics, which show that health care and social assistance are projected to make the largest contribution to employment growth over the next five years, appear to have been ignored. Whether it is creative arts or helping professions, there seems to have been a failure to recognise and value the people who work in these sectors and those who aspire to work in these sectors. I fear we may just find ourselves in a position where we cannot appropriately service the needs of Australians and have stifled our artists and creatives because, much like their inability to recognise rorting in time, the government could not recognise our future needs in time either.

The government says it has a responsibility to ensure that taxpayer money is well directed and spent in a way that offers the greatest benefit to the Australian community, so it must recognise that at the heart of vocational education and training are the futures and careers of Australians, particularly young people. If you hold the future of anyone, but especially a country, in your hand then you should take great care of it and not rush through what can only be described as unfair, inequitable and flawed policy. Thank you.

Simon Birmingham (SA, Liberal Party, Minister for Education and Training) Share this | Link to this | Hansard source

I thank all contributors to this debate on the VET Student Loans Bill 2016 and related bills. It is important to firstly remind ourselves why it is we are here and why it is we are doing this. We are doing this to close down the VET FEE-HELP scheme and to replace it with something far more targeted. As many have acknowledged, VET FEE-HELP has been a gigantic failure. We have seen enormous price rises, student growth jumping by 5,000 per cent, course costs tripling in some instances and the value of loans written against the Commonwealth blowing out from $26 million to $2.9 billion. The former Labor Attorney-General and now ASQA commissioner, Michael Lavarch, said during the Senate inquiry:

I have been in and around public life for a long time. I think I can fairly say that this was the worst piece of public policy I have ever seen.

VET FEE-HELP must come to an end. It must come to an end as soon as possible, and that is why the government has introduced this legislation to close this scheme down at the end of December.

We have, of course, taken action to try to fix it along the way. We have applied around 20 measures whilst in government to try to fix this program. Sadly, though, our decision is that a full reset is required. We have seen far too many brokers and far too many providers ripping off far too many students and taxpayers and destroying and hurting the reputation of the VET system at the same time. That is why on 5 October I announced the new VET Student Loans scheme as a replacement for VET FEE-HELP. It is a new scheme which will still provide financial support to enable genuine students to receive high-quality training—training that aligns with the skills needed in the workplace and the economy. There will be a higher bar of entry for providers; there will be tighter eligibility for courses and their relevance to the skills needs of the states and territories; there will be caps on loans that are related to the efficient cost of delivery of the courses; there will be restrictions on brokers; there will be tougher compliance and investigatory powers; there will be limits on third-party delivery of courses to approved providers; and there will be requirements in relation to student progression.

We want to ensure that students are getting what they pay for. We have inserted provisions to grandfather and protect those students currently in the VET FEE-HELP scheme to ensure that they are supported into the future to complete their studies. We have, of course, spent the last couple of days debating some very contentious legislation. To take a couple of stakeholders from that legislation and look at their views in relation to this legislation, we see broad agreement. Master Builders Australia, on the one hand, said to the Senate inquiry that they 'support the federal government's efforts to overhaul the flawed VET FEE-HELP scheme and believe the introduction of VET Student Loans will go further to protect taxpayers' dollars and students'. The ACTU, an opposite voice in some of the debates we have had in the last couple of weeks, equally said that they 'view the bills being considered as a broadly positive first step towards repairing the broken VET system and restoring public and industry confidence in the ability of the sector to deliver high-quality skills training'. We also have consumer advocates, such as the Consumer Action Law Centre, welcoming the government's package of reforms to the VET FEE-HELP loan scheme from a consumer protection point of view.

So, with industry, with unions and with consumer advocates all on side, I am pleased that this legislation looks like it will enjoy support across the parliament. I particularly thank the opposition for the constructive negotiations and discussions that we have had. I note that the government is bringing some amendments to this bill—amendments that we have worked on as a result of discussions with the opposition, particularly in relation to the adoption of an ombudsman advocated not only by the Labor Party but also by the Greens and, indeed, committed to some time ago by the government.

Our policy is different from that which Labor took to the election, despite what some in the chamber have said, and we have gone far further in restricting provider access, restricting courses to areas related to economic activity and ensuring that loan fees and loan caps are aligned to the cost of delivery of those courses. We have committed to a number of review mechanisms to make sure we get the methodology right in the future.

I note contributions particularly from Senator Hanson and Senator Leyonhjelm about repayment rates in relation to HELP loans. I would urge them to take note of comments I made that such matters are being considered in the context of higher education reform and can be considered at that time. I commend these bills to the Senate—bills that will clean up a great fraud and corruption in the VET system, which has rorted taxpayer dollars, hurt many vulnerable Australians and harmed the reputation of the VET sector, and that will instead give us a far more effective, far more targeted VET Student Loans program into the future.

Alex Gallacher (SA, Australian Labor Party) Share this | Link to this | Hansard source

The question is that the second reading amendments moved by Senator Hanson-Young on sheets 7966 and 7967 be agreed to.

Sarah Hanson-Young (SA, Australian Greens) Share this | Link to this | Hansard source

I seek leave to have the two amendments put separately.

Alex Gallacher (SA, Australian Labor Party) Share this | Link to this | Hansard source

I am just seeking an indication that the chamber would like the amendments moved separately to vote differently on the amendments.

Leave granted.

Stephen Parry (President) Share this | Link to this | Hansard source

The question is that the amendment moved by Senator Hanson-Young on sheet 7966 be agreed to.

Stephen Parry (President) Share this | Link to this | Hansard source

The question now is that the amendment, also moved by Senator Hanson-Young, on sheet 7967 be agreed to.

Question agreed to.

Original question, as amended, agreed to.

Bill read a second time.