House of Representatives

Second Reading Speech

Dr Nelson (Minister for Education, Science and Training)

I move

That this bill be now read a second time.

Under the policies of this government universities have enjoyed an unparalleled opportunity to be key institutions in Australia's social, cultural and economic life. Most have used that opportunity well. Universities are earning record levels of revenue-an estimated $10.4 billion in 2002. The sources of revenue are more diverse than ever before, indicating how far universities have come in engaging with the community. Universities are providing more opportunities for Australians to access higher education in the manner which suits them. There are now around 55,000 more full-time equivalent domestic students in our universities than there were in 1995. The satisfaction level of graduates with their education has also never been higher.

In building this impressive record, universities have been able to rely on a strong and undiminished commitment of public funding. The bill currently before the House is a clear expression of that commitment. The major measure in this bill is the provision of university funding for the year 2004, the final year of the current funding triennium. In keeping with the government's commitment to higher education, the moneys we seek to appropriate through the parliament for that year are significantly increased. In 2004 universities will receive operating funding through the Education, Science and Training Portfolio totalling $6.35 billion, some $480 million more than in 2001.

Last year the Prime Minister made the most significant set of policy and funding announcements in support of innovation that has ever been made in this country. It should be obvious that innovation has become a vital driver of economic growth and the key to economic prosperity. Universities produce much of the knowledge and skilled work force that sustain the innovation system.

The benefits of that package are already being enjoyed by universities. This bill puts in place the next stage of that commitment. I would like to remind the House of the extent of that commitment. The government's innovation action plan, Backing Australia's Ability, commits an additional $3 billion over five years for science, research and innovation. It includes an additional $1.5 billion for the university sector.

The funding is comprised of an additional $736 million to double the Australian Research Council's national competitive grant schemes. It includes $583 million to build up the research infrastructure in our universities and an extra $151 million over five years for additional university places in the priority areas of information and communications technology, mathematics and science.

The bill provides for a number of legislative housekeeping measures. It updates the funding amounts in the Higher Education Funding Act 1988 and the Australian Research Council Act 2001 in accordance with indexation arrangements. It also varies funding amounts to reflect revised estimates for HECS contributions, the Commonwealth's superannuation liability and the provision and repayment of an advance of operating grant to the University of Adelaide.

The bill provides for internal transfer of funding amounts between sections of the act that will enable the Institute of Advanced Studies of the Australian National University to participate in the government's performance based block research funding schemes. This is an important step in building a more integrated and competitive higher education research system.

The bill reduces the compliance burden on universities in relation to the accountability of Commonwealth funding. As it stands, universities are required to meet separate, and sometimes inconsistent, acquittal of requirements for different types of grant. These will be replaced with a single consistent provision applying to all funds provided under the act.

The requirement for institutions to send a `notice of liability' to overseas fee-paying students will be removed under the bill. There is currently no requirement to send liability notices to domestic fee payers. The government thinks it is best left to each institution to determine such administrative processes.

The bill contains two measures to streamline the administration of ARC grants and the provision of expert advice to the ARC board. The amendments to the ARC Act will enable the minister to formally approve research grants for a period of four years, rather than the two currently allowed by the act. This will reduce the amount of paperwork involved in administering grants and provide certainty to grant holders.

They will also allow the ARC board to create advisory committees, other than those specifically involving advice on funding allocations, without the approval of the minister, thus streamlining the processes for the ARC board to acquire expert advice on other matters.

In minor technical amendments, the bill changes two sections of HEFA to reflect changes in taxation legislation. It also amends the name of Batchelor Institute of Indigenous Tertiary Education in schedule 1 of HEFA, which is currently listed as `Batchelor College'. It remedies a minor drafting oversight in relation to the postgraduate education loan scheme.

I commend the bill to the House and present the explanatory memorandum.

Debate (on motion by Mr Cox) adjourned.