Dean Smith

In Parliament

BILLS Higher Education and Research Reform Amendment Bill 2014 Second Reading

December 01, 2014

I welcome the opportunity to participate in this debate about the future of higher education in this country, because the fact of the matter is that we can do better than we have been doing. But it is going to take a change of mindset. One of the curious things about this place is the attempt by those opposite to paint those of us on this side of the chamber as backward-looking, when on this bill, the Higher Education and Research Reform Bill 2014, as on so many important economic reforms over the last year, they are the ones looking back, clinging onto a world that no longer exists.


We live in an international economy that is constantly changing and constantly evolving. That is something we should all recognise and appreciate. If we want Australian universities to be the best, and if we want to attract the best and the brightest to study at them and to teach at them, then we have to recognise we are part of a global marketplace. I understand the sentiment surrounding the Whitlam era reforms has been heightened recently, but the truth is: that was four decades ago. Gough Whitlam governed in a very different time and in a very different Australia. The future needs of Australian students and of our education sector more broadly are not going to be met by indulging in misty-eyed sentimentality about how things used to be, which has been the response of some of those opposite in their pining for the age of 'free' university education.


As most of us in this chamber have worked out—or I hope have worked out—when we talk about 'free' education, what we actually mean is 'taxpayer funded' education.


Senator Williams: Nothing is free!


Senator SMITH: I might just add, Senator Williams, that we are talking about taxpayers who might not come from privileged backgrounds but taxpayers with backgrounds like that of my parents and my grandparents. We are talking about people who have worked hard to raise families finding themselves funding the education of others. I will come back to that in a moment.


As Senator Williams said, nothing in the world is free. Ultimately it is paid for by working men and women in this country, men and women like those in the streets I grew up in—Perth's northern suburbs. Australians are rightly proud of our higher education sector and they make a significant investment in it with their tax dollars. That is equally true both of those who attend and of those who do not attend university. When some in this place dream of a return to 'free' education, what they are really saying is they think it is fine for those who do not attend university to fully subsidise those who do. That is the logical extension of their argument.
What this government is asking is very simple. We are asking students to contribute half the cost of their education, with the tab for the other half being picked up by the taxpayer. At the moment, it is a 40-60 split, with the majority of the cost falling on taxpayers. From the carry-on from some in this place, you would think such a suggestion was the end of civilisation as we know it.


As is so often the case in this chamber, I find myself drawn to the arguments made by Labor leaders past in attempting to convince those opposite to support sensible reform. If the facts and the evidence will not convince you, maybe a bit of tribal loyalty will. I wonder if Labor senators can tell me who said:
There is no such thing, of course, as "free" education somebody has to pay.
… a " free" higher education system is one paid for by the taxes of all, the majority of whom haven't had the privilege of a university education. Ask yourself if you think that is a fair thing.


Those words did not come from a right-wing radical—though, given Labor's present attitudes towards economic reform, his former comrades may consider him to be one. Do you know who said that? None other than Labor hero Paul Keating, who used those words in a speech as Prime Minister in 1995. He used those words in defence of the HECS system, a system that required students once they earned over a certain threshold to pay back some of the cost of their university education. Who introduced that system? Bob Hawke, Labor's most successful ever prime minister. I do not mind saying that. The same Paul Keating was his Treasurer.
It simply astounds me that, given a choice between the Whitlam-Rudd-Gillard approach of spending massively, running up huge debts and ending in electoral disaster and the Hawke model of market driven economic reforms that delivered a record string of unbroken electoral victories to the Labor Party, those opposite tend toward the first approach and not the latter. I do not mind, of course; I am more than happy for Labor to remain safely ensconced on the opposition benches, where their damage is restricted. But I do find it curious.


I could also at this point invoke another name that is sacred to those opposite when it comes to education policy: that of David Gonski. This is from The Australian newspaper on 2 September this year:
THE architect of the former Labor government’s education reforms has backed the Abbott government’s plan to deregulate higher education fees, claiming it will free up funds to make universities ''even greater''…
David Gonski, chancellor of the University of NSW and one of the nation’s most respected businessmen, also called on the Labor opposition to stop playing politics in the Senate and back the government’s budget reforms…


I will move to the substance of the reforms that we are debating this morning in the Senate. They set Australia's higher education sector up to compete on a global scale.


Education, as is well known to many of us, is Australia's third largest export. If we want to keep it that way and, indeed, grow that export potential, we have to act now because this government inherited a dire situation from its predecessors not only in terms of the budget but also in terms of higher education. Labor are very fond of talking about higher education and how it is in their DNA. There is a saying that you always hurt the ones you love; and if that statement is true then, yes, the Rudd-Gillard government truly loved our university sector. Under the former government international student enrolments in Australia fell by 130 places—about 16 per cent. When you have a 16 per cent fall in your nation's third largest export, it is time to act. If those opposite are too cowardly to do so, that is for them to answer, for them to be accountable to.
I know some argue that Labor did reform the system, and it is true, but it is only partially true. Labor deregulated student numbers, removing the cap on the number of places, but they failed to deregulate the fees, and that is the important part of establishing a demand driven model. As Paul Kelly, no less, put in an excellent opinion piece he authored last August, Labor 'can cover their eyes, block their ears, shut their minds, but the problem won’t change. Labor made a cart but didn’t provide a horse.' I turn to the views of Mike Gallagher, who is Executive Director of the Group of Eight, our top tertiary institutions. He has said:
Unless there is reform we will continue to drift, we will fall behind the emerging universities of Asia and we will fall out of touch with the vital global centres of knowledge.


Mr Gallagher also said some pretty strong words for those who are trying to prevent these reforms from passing this Senate chamber. He said:
It is outrageous that they—
Labor and other senators—
have washed their hands of responsibility for the mess they created.


Universities Australia CEO Belinda Robinson has characterised the government's plan as a 'once-in-a-generation opportunity to shape an Australian higher education system that is sustainable, affordable and equitable in serving the best interests of students and the nation. She also says that failing to act now 'will condemn Australia's great university system to inevitable decline, threaten our international reputation and make it increasingly difficult for universities to meet the quality expectations of our students.' Yet, bizarrely, the self-proclaimed great friends of education opposite want to sit on their hands and do nothing.


I turn to my own state of Western Australia—indeed, your own state of Western Australia, Mr Acting Deputy President Sterle. I draw people's attention and the attention of all senators in this place to an excellent opinion piece that was published in the Australian Financial Review recently by Professor Alec Cameron, the Deputy Vice-Chancellor of the University of Western Australia. Professor Cameron's article is a refreshing antidote to some of the more hysterical claims that have emerged from those opposite about these education reforms. He points out one group of Australians who stand to benefit most from these reforms are students from rural and regional areas, particularly in Western Australia. UWA, the university that I attended for my undergraduate courses, has thoroughly examined the matter and found that students who live outside the Perth metropolitan region are at a distinct disadvantage in terms of accessing tertiary education.


Regional and remote areas within WA account for almost 20 per cent of the state's population of 15- to 19-year-olds, yet only 12.4 per cent of commencing university students come from these areas. That means rural and remote students are only getting to university at 60 per cent of the rate of students from metropolitan Perth. It is not as though students in rural and remote areas are not performing academically; in fact, they receive offers of university placements at rates comparable to their urban counterparts, but they do not accept them at anywhere near the same rate. Even more interesting was this fact: around half of those who do accept an offer immediately defer their place in order to spend a year working to satisfy the financial independence requirements to obtain a higher level of Austudy or to qualify for other financial support mechanisms available to students.


Of course, many end up remaining in work and having formed various social connections while becoming accustomed to working lifestyles, never then actually taking up those deferred places. That is a problem; it needs to be addressed. None of this will be news, I realise, but I think that one of the tragedies of the stubborn refusal of those opposite to support these reforms is the loss of opportunities to rural students. It is far easier for university students who can remain living at home in suburban Perth to attend our universities. Those who come from rural and remote communities are faced with meeting a typical cost of living away from home of around $20,000 per year. One of the provisions contained within the legislation we are now discussing is the requirement to provide scholarships for disadvantaged students.


As I have just outlined, students from regional and remote parts of Western Australia are at a distinct disadvantage. These scholarships can actually be used to help students from rural areas to meet the cost of living away from home. Certainly that is the view of the University of Western Australia, based on Professor Alec Cameron's article. This has the potential to be the largest scholarship scheme in Australian history for assisting disadvantaged students, yet the alleged 'party of education', the party opposite, will not support it. These reforms do not alter the fundamental of Australia's higher education system. No student will have to pay a single dollar up-front for the cost of their degrees as a result of these reforms. HELP remains in place and no-one pays anything back until they are earning over $50,000 per year. It remains a matter of considerable irony to me that the only fees students are forced to pay up-front at university are compulsory student union fees, which the Howard government abolished when it was in office and which Labor and the Greens rushed to introduce as soon as they got back into office. Nothing demonstrates more the hypocrisy of those opposite than that they talk about higher education fees but are silent on compulsory student union fees or student amenity fees, as they are called in some places. So much for their claims about making life easier for university students.


There are other voices in our community highlighting the benefit of these reforms for university students. The Vice-Chancellor of the Australian National University, Professor Ian Young, addressed the National Press Club on these reforms saying:


It would be a great tragedy for our nation, for our universities, for our future generations, if our senators pass up this opportunity …

Professor Steven Schwartz, Executive Director of the Council for the Humanities, Arts and Social Sciences, whose annual awards dinner I attended recently in Melbourne, had this to say on The Conversation website:
As I travel around the nation, it pains me to find much wringing of hands and gnashing of teeth in the senior common rooms of our universities. The academic union reports that morale has never been lower. What is the cause of all this angst? Deregulation of tuition fees.


According to the received wisdom, deregulated fees will create a crisis for the arts and humanities. Driven by the fear of large debts, students will abandon English, philosophy and art for accounting, forensic science and sports management. English departments will disappear and history departments will themselves be history.
This would all be pretty terrifying except for one fact. The humanities have supposedly been dying for decades. Curiously, the long slow death of the humanities seems to have little to do with the facts.

Last year, one in three Australian graduates received a degree in the creative arts, society and culture. (This is the government-approved title for the humanities and social sciences.) These enrolments increased 5% over the preceding year and 29% of all doctoral degrees awarded last year were in humanities, arts and social sciences.


Like most of the scare campaigns run by those opposite, I confidently predict that none of the predictions of doom in our tertiary education system will come to anything.


The other aspect of these reforms that I find particularly exciting is the expansion of the HECS system for the first time ever to include diplomas, advanced diplomas and the trades. That means that for the first time you will not need to pay a single dollar up-front to obtain a diploma or an advanced diploma. Now that is important because for many great young Australians, particularly those who come from disadvantaged or challenging backgrounds, a diploma is often an entry point into the world of higher education. I am proud to be a member of a government that has said that if a HELP-style scheme is good enough for university students, it is also good enough for those who want to pursue a trade so that people can get a $20,000 loan up-front and you do not have to repay a cent until you earn over $50,000. I think this contrasts drastically with the increasingly—if I may say—snobbish attitude of some of those who seem to think that a certain type of education is better than others. Our society needs plumbers, builders and carpenters every bit as much as it needs lawyers, doctors and architects. It is high time we afforded those pursuing vocational education the same opportunities as those pursuing university degrees.


We know that boosting this nation's research capacity is crucial to our economic development. These reforms will help Australia ensure we safeguard a strong, competitive research system. Again, it is curious that, when Labor was last in office, they left a situation where no funding was put aside for the National Collaborative Research Infrastructure Strategy beyond 30 June next year, nor did they provide a single dollar for the Future Fellowships program that supports mid-career researchers to undertake world-class research in Australia. In contrast, this government, the coalition government, is committing to invest $11 billion over four years in research in Australian universities. Included in that is $139 million for the Future Fellowships scheme and $150 million in 2015-16 to continue the National Collaborative Research Infrastructure Strategy.
Labor can talk all they like about their commitment to education, but their neglect of both the Future Fellowships program and the National Collaborative Research Infrastructure Strategy is another demonstration—as if it were needed—that the Labor Party is all talk and no action.


I began my contribution with some wise words from respected Labor figures past, so I think it is only fitting that, in conclusion, I offer some words on this matter from Labor figures present. One Labor figure in particular is not only a member of this present parliament but is in fact a member of the opposition's front bench. The shadow Assistant Treasurer and the member for Fraser in the other place, in a 2004 book entitled Imagining Au stralia: Ideas for our Future wrote that our universities should be:

… free to set student fees according to the market value of their degrees ... Universities will have a strong incentive to compete on price and quality ...
What?—I hear you say. That is right. The Labor member for Fraser said universities should be:
… free to set student fees according to the market value of their degrees ... Universities will have a strong incentive to compete on price and quality ...

It is no accident that most politicians write their books after they have been in parliament. He goes on to say:
Much-needed additional funding will be available to universities that capitalise on their strengths and develop compelling educational offerings. The result will be a better-funded, more dynamic and competitive education sector.


Get this! The Labor member for Fraser, who sits in the House of Representatives today, has said the result will be 'a better-funded, more dynamic and competitive education sector'. Those are wise words from the member for Fraser, who is one of the genuine thinkers—I don't mind saying that—on the other side of the parliament. Of course he also supported the introduction of a price signal for medical services with a GP co-payment, but that is for another time—this afternoon, I suspect.

However, the Member for Fraser and the Minister for Education are both correct. The reforms proposed in this legislation will create a more dynamic and competitive tertiary education sector. More than that, they will create a more diverse and equitable sector, particularly for students wishing to study diplomas or advanced diplomas, as well as those from remote and regional communities. (Time expired)