House of Representatives

Second Reading Speech

Mr CLARE (Blaxland - Minister for Education)

I move:

That this bill be now read a second time.

We have a good education system.

But it can be a lot better and a lot fairer.

This bill is an important part of achieving that goal.

It is the first stage of the implementation of the Universities Accord.

It will wipe out about $3 billion of HELP debt for more than three million Australians.

It will introduce, for the first time, a Commonwealth Prac Payment. That is Commonwealth government financial support for teaching students, for nursing students, for midwifery students and for social work students, to help support them while they do the practical part of their degree.

And it massively expands fee-free university ready courses - the courses that act as a bridge between school and university, and help ensure that more Australians get a crack at university and succeed when they get there.

All are key measures recommended in the final report of the Universities Accord, led by Professor Mary O'Kane AC.

Professor O'Kane is a former vice-chancellor of the University of Adelaide and New South Wales' first Chief Scientist and engineer as well as the first woman to be a dean of engineering at an Australian university.

Professor O'Kane was supported by an esteemed group of Australians, including:

•Professor Barney Glover AO, former vice-chancellor of Western Sydney University and now Jobs and Skills Australia Commissioner

•Ms Shemara Wikramanayake, Managing Director and Chief Executive Officer of Macquarie Group

•the Hon. Jenny Macklin, former Minister for Families, Community Services and Indigenous Affairs.

•Professor Larissa Behrendt AO, the first Indigenous Australian to graduate from Harvard Law School. Larissa is a professor of law and the director of research and academic programs at the Jumbunna Institute for Indigenous Education and Research at the University of Technology Sydney.

•the Hon. Fiona Nash, Australia's first Regional Education Commissioner, a former senator for New South Wales, a former Minister for Regional Development, Regional Communications and Local Government and Territories.

The accord panel has provided us with a blueprint to reform higher education over the next few decades.

Funding it and implementing it is going to take more than just one budget.

We have to do this in stages.

But we have bitten off a big chunk.

Twenty-nine of the 47 recommendations, in full or in part.

That includes the measures in this bill, which amend the Higher Education Support Act 2003 and related legislation.

First, the bill amends the Higher Education Loan Program, or HELP, indexation methodology to be based on either the consumer price index or the wage price index - whichever is lower.

This change applies to HELP (or what we used to call HECS), VET student loans, Australian apprenticeship support loans and other student support loan accounts.

The big hike in student debt last year hit a lot of Australians hard, particularly a lot of young Australians.

They've made their voice heard. The Albanese government has heard them and we are acting.

That's why this bill will wipe around $3 billion in student debt for three million Australians nationwide - easing pressure on workers, apprentices, trainees and students across the country.

It will provide significant relief for people with a student debt while continuing to protect the integrity and value of student loans systems, which have massively expanded tertiary access for more Australians.

And we're going further.

The bill backdates this relief for student support loans, including HELP, VET student loans and Australian apprenticeship support loans that existed on 1 June last year.

In other words, we're going to wipe out last year's unfair CPI indexation rate of 7.1 per cent and replace it with the lower WPI rate of 3.2 per cent. It will also wipe out the 4.7 per cent from this year and reduce it to 4 per cent.

For someone with an average debt of $26,500, they'll see around $1,200 wiped from their outstanding loan this year.

For someone with a debt of $45,000, it will mean that their debt is cut by about $2,000.

For someone with a debt of $60,000, it will mean that their debt is cut by almost $2,700.

Corresponding changes are made to the VET Student Loans Act 2016, Australian Apprenticeship Support Loans Act 2014, Social Security Act 1991 and Student Assistance Act 1973 to ensure that the revised methodology also applies to VET student loans, to Australian apprenticeship support loans, to student start-up loans, ABSTUDY student start-up loans and the Student Financial Supplement Scheme.

Second, this bill amends the Higher Education Support Act to allow for grants to be paid to higher education providers for a new Commonwealth prac payment.

This is an important reform.

A lot of students tell me that when they do their prac they have to give up their part-time job, or they've got to move away from home or work fewer hours.

Sometimes it can mean they have to delay doing their degree or not finish it at all.

That's why for the first time ever, we are introducing this payment for eligible teaching, nursing, midwifery and social work students.

This will give people who've signed up to do some of the most important jobs in this country a bit of extra help to get the qualifications that they need.

This is practical support for practical training.

Just to give you one example of what this will mean, a few weeks ago I met a midwifery student at UTS who told me this:

'I'm a first-year mature-age midwifery student. This payment is going to be absolutely life-changing for me. As a mother of two small children, I'm often balancing between practical work, placement and looking after my babies.

'There are literally some days where I'm doing 16-hour days between my study and my work and looking after my children.

'I cannot wait for this payment to be available for myself and other future mature-age students who might also want to enrol in this course who previously couldn't financially afford it.'

That's what this reform is all about.

Third, the bill establishes a new Commonwealth Grant Scheme funding cluster for 'FEE-FREE university ready courses'.

These are free courses that are effectively a bridge between school and university to give students the foundational skills they need to succeed at university.

Some unis already offer these courses.

Not many do it better than Newcastle university.

They've been doing it now for 50 years.

One in five people who get a degree from Newcastle university today start with one of these FEE-FREE courses.

People like Jennifer Baker.

Jennifer was a mum at 19. She worked in hospitality for 10 years. One day she saw an ad in the paper for one of these free courses.

Now she's got a science degree, an honours degree, a PhD and a Fulbright scholarship.

She's a computational medicinal chemist.

That's what these courses do.

And what this bill does is effectively uncap FEE-FREE Uni Ready courses, right across the country, giving more Australians like Jennifer that life-changing opportunity to get a crack at university.

Another good example of this is the University Preparation Program at the University of Tasmania, where 51 per cent of students who go through the program are the first in their family to have ever attended university.

And 39 per cent of them are from a low SES background.

This reform is expected to increase the number of people doing these free courses by about 40 per cent by the end of the decade and double that number in the decade after that.

Fourthly, the bill requires that higher education providers allocate a minimum of 40 per cent of the student services and amenities fees revenue that they collect from students to student led organisations.

This will ensure that students have a significant voice in how their services and amenities fees are spent.

Universities can apply to the secretary of my department for a transition period to implement this change.

Any transition arrangements for public universities must be completed within agreed timeframes, up to a maximum of three years.

These are all recommendations of the Universities Accord.

And they are all important measures in and of themselves.

But they are only one part of what we need to do to build a better and a fairer education system.

Under Bob Hawke and Paul Keating, the number of Australians finishing high school jumped from around 40 per cent to almost 80 per cent. That was nation-changing stuff.

Now we're taking the next step.

We've set a target for the nation that, by 2050, 80 per cent of our workforce hasn't just finished school but also gone on to TAFE or to university.

If we hit that 80 per cent target the economic dividend for all of us is real.

For individuals it means they earn more.

The evidence is, if you go to university, you earn more.

It also means as a country we earn more.

My department estimates the economy will be better off to the tune of about $240 billion in additional income up to the year 2050, in today's dollars.

So how do we hit this target? How do we build a workforce where 80 per cent have a tertiary qualification?

The short answer is we can't unless we build a better and a fairer education system.

And this bill is one part of that.

What the accord says is, to hit that target, we need to break down two big barriers.

One of those barriers is artificial, and the other one is invisible.

The artificial barrier is the one that we've built for ourselves between vocational education and higher education.

We're not going to fix the skills shortages that we have today, or the ones we'll have in the future, unless the two are more integrated, unless they're more joined up, unless we fix things like recognition of prior learning and make it easier for what you've learnt in TAFE to be counted towards a degree at university so you can get a degree quicker and cheaper.

In the budget, we've announced more than $27 million in immediate measures to help break down the barriers between VET and higher education to ensure a more seamless and aligned tertiary education system, including recognition of prior learning and streamlining regulation for dual sector providers.

And we're already doing things here.

For example, we're working on the business case now for a national skills passport, an app where you can upload all of your skills, qualifications and work experience to make it easier for employers to find the people they need.

We're also investing $650 million with the states to establish up to 20 centres of excellence. These are places where TAFE and uni come together, where you can get a certificate, a diploma or a degree.

But what the Universities Accord says is, to get these two sectors really working more closely together, we need one body that can help better integrate the two and what they do.

They recommended an Australian tertiary education commission to do this job.

And that's what we're doing.

We want to get this right so at the moment we're consulting with the sector about the detailed design of an Australian tertiary education commission.

The second barrier that we have to break down is that invisible barrier that stops a lot of people, a lot of young people, from poor families, from the outer suburbs of our big cities and from the regions from ever going to university in the first place and succeeding when they get there.

This bill lays the foundations to massively expand the number of people doing those FEE-FREE Uni Ready courses that I mentioned a moment ago.

That's not the only thing we're doing. We've also released consultation papers on the detailed design of a new funding system for higher education that includes managed growth and a needs based funding system to help more people from disadvantaged backgrounds to get the help that they need when they start a university degree to finish it.

Feedback from stakeholders will be essential in helping to shape these important reforms.

But this is also just the start.

The truth is we're not going to be successful if reform only happens at the university gate.

We've got to reform every part of the education system.

That means fixing the funding for our public schools and tying it to practical reforms.

At the moment, the number of students finishing high school is going backwards. In the last seven years it's dropped from 85 per cent down to 79 per cent.

And in public schools that drop is even bigger, from 83 per cent to just over 73 per cent.

We've got to turn this around. That's what the Better and Fairer Schools Agreement that I tabled in parliament yesterday is about.

All up, I have put $16 billion of additional investment for public schools on the table.

To put that into context: this would be the biggest increase in Commonwealth funding for public schools ever delivered.

I've made it clear that this funding must be tied to reform.

That means practical things like phonics checks and numeracy checks, evidenced based teaching and catch-up tutoring to identify children who need additional support and make sure that they get it.

These are the sorts of things that will help more children catch up, keep up and finish school.

But reform also doesn't start there.

If we're serious about this, we have to go back even further.

I think we all know that the first five years of a child's life are everything. Everything they see, everything they hear, everything they eat, every book that they open, every lesson they learn shapes and makes the person they become.

And what we know is that, at the moment, it's children from poor families who are the least likely to go to early education and care, and the most likely to benefit from it.

The Productivity Commission's final report is now on my desk, and it will help chart a course to building a truly universal early education and care system.

If we're going to build that system, then the first step, the very first thing that we need to do, is to build the early education and care workforce.

And that involves better reward for the work that our early educators do.

That's why last week we announced the government will fund a 15 per cent pay rise for early childhood education and care workers.

This is good for parents. It's good for educators.

It's good for our economy.

And, most importantly, it's good for our children.

The childcare debate is over. This is not babysitting. It's early education and it's critical to preparing children for school.

The American President often makes the point that, if a child goes to preschool, they're 50 per cent more likely to go to college or university. So this isn't about changing nappies; it's about changing lives. That's what our early educators do. That's what our early education system does and can do.

And if we're going to hit that 80 per cent target by 2050, then we need to be building a better education system for the children in our early education centres and our primary schools today.

That means children like my little guy in second class or his little brother still in nappies.

And it's for the babies who will be born tomorrow and the day after that into poverty and into wealth and everything in between.

They'll grow up in big cities and outer suburbs, in the regions and the bush.

And they'll go to school in the 2030s and TAFE or university in the 2040s.

This bill is an important first step in making sure that we are ready for them.

I commend it to the House.

Debate adjourned.