Bills Digest No. 121, 2016–17
PDF version [826KB]
Carol Ey
Social Policy Section
30
June 2017
Contents
The Bills Digest at a glance
Purpose of the Bill
Structure of the Bill
Background
Costs of tuition
Increasing student loan repayment
rates
The cost of increasing HELP debt
Measures to reduce unpaid debt
The potential impact of changes to
HELP repayment arrangements
Figure 1: current legislated and
proposed HELP repayment thresholds and rates, 2018–19 tax year
Figure 2: change in tax rate between
legislated and proposed repayment arrangements, 2018–19 tax year
Funding of enabling, sub-bachelor and
postgraduate coursework courses
Enabling courses
Sub-bachelor degrees
Postgraduate coursework degrees
Changed arrangements for permanent
residents and New Zealand citizens
Committee consideration
Senate Education and Employment
Legislation Committee
Senate Standing Committee for the
Scrutiny of Bills
Policy position of non-government
parties/independents
Position of major interest groups
Financial implications
Statement of Compatibility with Human
Rights
Parliamentary Joint Committee on Human
Rights
Key issues and provisions
Schedule 1—costs of higher education
Additional loading for high cost
courses
Changes to funding arrangements for
Commonwealth supported places (CSPs)
Schedule 2—Commonwealth Grant Scheme
Part 1—enabling and sub-bachelor
courses and work in industry
Part 2—amendments generally applying
from 1 January 2019
Schedule 3—Higher Education Loan
Program
Changes to entitlements to
Commonwealth supported places and the Higher Education Loan Program
Student loan repayment arrangements
Schedule 4—other grants
Other provisions
Concluding comments
Appendix A: HELP repayment thresholds(a)
and rates and Average Weekly Earnings (AWOTE): 1988–89 to 2016–17
Date introduced: 11
May 2017
House: House of
Representatives
Portfolio: Education
and Training
Commencement: Sections
1 to 3 commence the day of Royal Assent. Schedule 1, Schedule 2 Parts 1 and
3, Schedule 3 Parts 1 and 3, and Schedule 5 commence the day after the day
of Royal Assent. Schedule 2 Part 2 commences on the sooner of a day or days
to be fixed by Proclamation or 12 months from the day of Royal Assent.
Schedule 3 Part 2 commences immediately after commencement of Schedule 1 to
the Budget Savings (Omnibus) Act 2016 (1 July 2018). Schedule 4 commences
on 1 January 2018.
Links: The links to the Bill,
its Explanatory Memorandum and second reading speech can be found on the
Bill’s home page, or through the Australian
Parliament website.
When Bills have been passed and have received Royal Assent,
they become Acts, which can be found at the Federal Register of Legislation
website.
All hyperlinks in this Bills Digest are correct as
at June 2017.
The Bills Digest at a glance
Purpose of the Bill
- This
Bill proposes to amend the Higher Education Support Act 2003 (HESA)[1]
to reduce Commonwealth funding of tuition costs for undergraduate courses at
universities through increasing the student contribution towards these costs,
and reducing the funding universities receive to cover these costs.
- It
also seeks to change the funding arrangements for enabling, sub-bachelor and
postgraduate coursework places, specifically it will:
- remove
the loading for enabling courses and replace it with a student contribution
- remove
the cap on funding of sub-bachelor degrees for those students without a
previous higher education qualification and
- change
the funding arrangements for postgraduate coursework qualifications from
allocating places to providing scholarships.
- In
order to reduce the level of student loan debt that is unlikely to be repaid,
significant changes are proposed to repayment arrangements, meaning that those
in the workforce will commence repayment at much lower income levels and at
higher rates.
- The
Bill also proposes to incorporate the arrangements for the Higher Education
Participation and Partnerships Program (HEPPP) into HESA to provide
universities with funding certainty for this Program.
Background
- Commonwealth
funding for higher education has increased substantially since restrictions on
student enrolments in bachelor level courses were removed in 2009.
- In
order to limit further increases in funding a range of measures were introduced
in the 2014–15 Budget, a number of which have not been legislated. The measures
in this Bill were announced in the 2017–18 Budget, replacing those proposals
that were not legislated.
- While
students notionally contribute more than 40% of the cost of their tuition on
average, most pay these contributions through taking out income-contingent
loans. The proportion of these loans that is not expected to be repaid has also
increased in recent years, to an estimated 23% in 2016–17.
Key issues
- The
Government is proposing that students pay a higher proportion of the costs of
their tuition, on the basis that they receive significant private benefits from
their university education. However, it is unclear whether today’s students
will receive the benefits on graduation that earlier cohorts have.
- The
efficiency dividend being imposed on universities assumes that current funding
levels are excessive, although the Government itself acknowledges that the
costs of tuition are not transparent.
- The
proposed changes to student loan repayment arrangements will have a substantial
impact on those in the workforce on low to moderate income levels. Imposing an
additional tax burden on this group may have wider implications for the economy
in terms of reduced disposable income and reduced workforce participation.
- Some
measures in the Bill seek to expand the opportunity for students from
disadvantaged backgrounds to participate in higher education. However,
increasing student contributions and more onerous loan repayment arrangements
may deter some of these students from participating.
Purpose of
the Bill
The purpose of the Higher Education Support Legislation
Amendment (A More Sustainable, Responsive and Transparent Higher Education
System) Bill 2017 (the Bill) is to amend the HESA and related
legislation to:
- change
the funding arrangements for Commonwealth Supported Places (CSPs), in
particular by[2]
- increasing
the student contribution and reducing the government contribution
- extending
the medical student loading to dentistry and veterinary science courses
- replacing
allocated postgraduate coursework CSPs with scholarships
- replacing
the loading for enabling courses with student contributions
- removing
eligibility for CSPs from most New Zealand citizens and permanent residents
- reserving
7.5% of Commonwealth funding for allocation on a performance basis and
- funding
certain work experience units
- extend
eligibility for CSP funding to additional courses including sub-bachelor and
preparatory courses
- change
the eligibility and repayment arrangements for Higher Education Loan Program
(HELP) and other student loans, including extending eligibility for these loans
to New Zealand citizens and permanent residents
- give
effect to changes to the HEPPP and
- make
some minor technical amendments.
Structure
of the Bill
The Bill consists of five Schedules.
Schedule 1:
- extends
the current additional funding loading for medical student places to dentistry and
veterinary science
- reduces
the Commonwealth funding contributions per place through the Commonwealth
Grants Scheme (CGS) for CSPs in 2021 for each funding cluster, through the
application of an efficiency dividend and to compensate for increased student
contributions, and specifies the transitional funding amounts for 2018–20
- introduces
new maximum amounts for student contributions in 2018 for each funding cluster
and provides for these amounts to be increased by 1.824 % for each of the years
2019 to 2021 and
- sets
the maximum student contribution for enabling courses in 2018 (which is not
subject to the increase in for funding clusters in later years).
Schedule 2 proposes to remove the funding loading
currently applying to places in enabling courses. This funding will be replaced
by student contributions as mentioned above. It also extends Commonwealth
funding to work experience in industry units that meet specified requirements,
and also to approved sub-bachelor courses, for students who have not previously
obtained a higher education award. It also changes the funding arrangements for
students in supported post-graduate coursework programs, and provides for up to
7.5% of CGS funding to be allocated on a performance basis.
Schedule 3 Part 1 removes eligibility for CSP
places from most permanent residents and New Zealand citizens, but provides them
access to HELP and VET Student Loans.[3]
Part 2 amends the loan repayment thresholds and rates for student loans.
It also changes the basis for indexation of the repayment thresholds, from adult
total weekly earnings (AWE) to the Consumer Price Index (CPI).
Schedule 4 establishes the HEPPP as a designated
grant program in HESA and specifies the arrangements for loadings for
students from low socioeconomic backgrounds and for performance funding under
HEPPP, and provides funding for the National Priorities Pool.
Schedule 5 incorporates name changes for two
providers and amends the definition of a higher education award.
Background
In 2009, Government controls on the number of students who
could be enrolled in funded undergraduate bachelor programs at public
universities were removed. This has led to a government funding increase of
some 71%, more than twice the rate of growth of the economy as a whole.[4]
The 2014–15 Budget saw the Government propose significant
changes to the funding of the higher education sector, including a 20% reduction
in the Government contribution to undergraduate course costs, and the
deregulation of the fees that institutions could charge students.[5]
In part these measures were driven by a desire to rein in these rising costs.
There was also concern about the increasing cost of student loan debt.[6]
However, despite this increase, according to the
Organisation of Economic Co-operation and Development (OECD), in 2013,
Australia’s public funding of tertiary education (which includes some
vocational education and training (VET) sector funding) was 0.7% of Gross
Domestic Product (GDP) compared to an OECD average of 1.1%.[7]
Few of the 2014–15 Budget measures proposed by the
Government were legislated, and, in October 2015 Minister Birmingham announced
that the remaining reforms would be delayed until 2017 at the earliest and
consultation on them would follow.[8]
In the 2016–17 Budget, the Government announced it was abandoning its proposal
to deregulate fees, and would delay the implementation of other measures for a
further year to undertake further consultation.[9]
It also released a consultation paper on these proposed changes which stated
that a revised package of reforms would be finalised in 2016 and legislated no
later than mid-2017, to allow for commencement from 2018.[10]
The package of reforms following this consultation was
announced shortly before the 2017–18 Budget.[11]
In the Budget, the Government announced it was not proceeding with the
unlegislated components of the 2014–15 Budget, at a cost of some $3.4 billion
over the forward estimates, but proposed replacement measures resulting in
savings of approximately $3.8 billion.[12]
This Bill seeks to legislate these Budget proposals.
The major proposals are:
- an
‘efficiency dividend’ of 2.5% in each of 2018 and 2019 on the government
funding for tuition costs for CSPs
- increasing
the proportion of these tuition costs paid by students
- increasing
the repayment rate of student loans and
- changes
to CSP arrangements for lower level courses and postgraduate coursework degrees.
Costs of
tuition
Tuition costs in CSPs are funded by a combination of student
and government contributions. The contributions of each are determined by the
field of study. Fields of study are grouped into ‘clusters’ of like subjects,
with the student contributions partially reflecting their likely capacity to
repay student debt after graduation, and the government contribution (through
the CGS) making up the balance of the assessed tuition cost.[13]
Since 2005, student contribution levels have been legislated as ‘maximum’
levels, but all universities have moved to charging the maximum rates.[14]
Medical courses are grouped in the same cluster as dental
studies and veterinary studies, but universities also receive additional
government funding through a ‘medical student loading’ for students in medical
courses, reflecting their higher tuition costs. For 2017 this loading was
$1,394.[15]
In assessing whether the levels of funding provided were
appropriate, the Base Funding Review in 2011 concluded that the level of
tuition funding provided was ‘sufficient on average for the current costs
relating to undergraduate teaching and scholarship but may not be enough for a
reasonable level of expenditure on base capability research’.[16]
This raises the issue of the extent to which research is an essential element
underpinning university tuition. In order to achieve ‘university’ status, institutions
must (among other things):
- undertake
research that leads to the creation of new knowledge and original creative
endeavour at least in those broad fields of study in which Masters Degrees
(Research) and Doctoral Degrees (Research) are offered
- demonstrate
the commitment of teachers, researchers, course designers and assessors to the
systematic advancement and dissemination of knowledge and
- demonstrate
sustained scholarship that informs teaching and learning in all fields in which
courses of study are offered.[17]
This suggests that some basic level of research is deemed a
requirement for universities to effectively deliver courses, even at the
undergraduate level. In 2011, the Base Funding Review concluded that between 6%
and 10% of tuition funding could reasonably be associated with the maintenance
of this base research capability.[18]
The Kemp-Norton Review of the demand driven system, which
was commissioned by the Abbott Government in 2013 noted that while some
universities could find genuine efficiencies, ‘reduced income per student wold
likely lead to the postponement or cancellation of worthwhile expenditure’.[19]
A recent review of the costs of tuition undertaken by
Deloitte Access Economics for the Department of Education and Training found
that the teaching cost to CSP funding ratio for 2015 was 0.85, compared to 0.94
for 2010, when the Base Funding Review analysis was undertaken.[20]
However, the authors note ‘these figures cannot be compared as direct growth or
decline in costs relative to funding over the five years to 2015, given the
differences in the sample, and differences in cost collection approaches.
Similarly, caution should be taken in drawing inferences about the sufficiency
of CGS funding directly from these ratios’.[21]
The report also notes that CGS funding is generally viewed as intended to cover
some level of base research activity which may be not have been included in the
teaching and scholarship costs used in the latest study.[22]
Another analysis suggests that savings measures introduced
since 2013 have already had an impact on university finances.[23]
Despite these caveats, the Government has taken the
Deloitte finding to suggest that universities have become more efficient over
time, especially as they have benefited from greater economies of scale.[24]
It has therefore proposed a 2.5% efficiency dividend to be applied to the Commonwealth
contribution to CGS funding over each of the two years 2018 and 2019. As this
funding only provides a portion of the tuition costs (the remainder being from
student contributions) the net effect of this measure is expected to be a
reduction in university income for CSPs of 2.8% on average, with the impact on
each institution varying slightly depending on their course mix.[25]
Commonwealth
and student contributions to course costs
At present, students pay on average around 42% of the
costs of their tuition.[26]
This varies substantially depending on the field of study, ranging from 28.4%
for agriculture students up to 83.5% for those studying law, accountancy,
administration, economics or commerce.[27]
The Government has referred to research undertaken by Deloitte
Access Economics, which at the time of writing was not publicly available,
indicating that the private benefits of receiving a university undergraduate
degree is around 45% of the total benefit on average.[28]
However, this also varies between courses, ranging from 39% for engineering
graduates to 51% for those graduating in education.[29]
On this basis, the Government is arguing that as students
receive on average a higher proportion of the benefits of their education than
they currently contribute, it is proposing to increase amount students
contribute to 46% of course costs by 2021.[30]
Given that the underlying research has not been published,
it is not possible to assess the basis on which the private benefits of a
degree have been calculated. Most analyses which consider the lifetime earnings
benefits received by graduates use Census data. This assumes that the returns from
undertaking a degree are consistent over time—that is, the increased income
earnt by someone in their 50s who graduated 30 years ago will be reflected in the
earnings of a recent graduate in 30 years’ time.[31]
However, there is some evidence that recent graduates are
not faring as well in the labour market as earlier generations. The Government
itself has acknowledged that graduate earnings are not increasing at the same
rate as average incomes, in noting that HELP repayment thresholds, which are
indexed to average weekly earnings, have been rising relative to graduate incomes.[32]
This trend seems likely to continue as the starting salaries of bachelor degree
graduates aged less than 25 in their first full-time employment have fallen
from 100.0% of the annual rate of male average weekly earnings in 1977 to
around 75% in the period 2013–15.[33]
And while the employment rate of new graduates has always fluctuated depending
on economic conditions more generally, rates have been in decline since 2008,
meaning that for 2015 graduates, more than 30% of those seeking full-time work
were unemployed or underemployed four months after graduation.[34]
These trends are perhaps not surprising when the
proportion of those of workforce age with a degree or higher qualification has
risen from 7.9% in 1989, when student contributions were first introduced, to
27.7% in 2015.[35]
There are also a considerable number of students who never
complete their degree, with one recent study suggesting that after nine years,
73.4% of students in CSPs who commenced in 2006 had completed their
qualification, while a further 4.3% were still enrolled.[36]
This means 22.3% left before graduating. It is not clear whether these students
may have gained some benefit from their investment in higher education, but it
is unlikely that their returns will be as high as for those who complete a
qualification.
Overall, this suggests that on average, the private
benefit to students of undertaking higher education is unlikely to be as high
as the 46% that the Government is proposing they contribute to the cost of
their studies. As noted above, the notional tuition costs appear to also
include an element of funding for research (which presumably has a wider
community benefit), which means that students would actually be contributing
somewhat more than 46% of the direct costs of their tuition.
There is the potential that increasing student
contributions will deter some students, and in particular those from disadvantaged
backgrounds, from undertaking higher education studies. An analysis undertaken
by Deloitte Access Economics in 2011 found that the increases in student
contributions and lowering of student loan repayment thresholds in 1997 and
2005 had the effect of reducing demand for higher education by around 8% in
each of these years, with students from a low socio-economic status (SES)
background most responsive to the changes.[37]
However, it should be noted that the increases in these years were immediate
and substantial, increasing by over a third between 1996 and 1997 and by 25%
from 2004 to 2005. On the other hand, the Base Funding Review considered the
research that had been undertaken on the impact of previous increases in
student contributions and found that the evidence was inconclusive.[38]
Increasing student
loan repayment rates
The cost of
increasing HELP debt
Most students in CSPs are able to pay their contribution
through a HECS-HELP loan. In addition, a range of other loans are available to
students studying in some full-cost courses (such as certain postgraduate coursework
degrees) as well as to students in certain courses in the vocational education
and training (VET) sector.[39]
All these loans are provided on an income-contingent basis, that is, repayment
of the loan only occurs when the debtor’s income is above a certain threshold.
For the 2016–17 tax year, the income threshold is $54,489.[40]
It should be noted that the income for HELP purposes includes reportable fringe
benefits, total net investment loss (which includes net rental
loss), reportable super contributions, and exempt foreign employment income
amounts, in addition to taxable income.[41]
According to the latest figures available, in 2013 around
87.1% of students in CSPs required to pay student contributions took out a
HECS-HELP loan.[42]
In addition, in 2013 a discount of 10% applied for upfront payment of the
student contribution, providing an incentive for those students who could
afford to do so not to acquire a debt. It is likely that with the removal of
any incentive for upfront payments the proportion taking out a HECS-HELP loan
will have increased.
This factor, combined with the rapid increase in student
numbers following the removal of caps on CSP places and the expansion of the
HELP loan arrangements to students in non-CSP places and to the VET sector, has
seen a dramatic rise in the number of students with a HELP debt. Over the four-year
period from 2011–12 to 2015–16, the number of HELP debtors increased by 50%,
from 1.7 million to 2.5 million, and the total debt levels increased from $25.5
billion to $47.9 billion.[43]
While the average level of debt only increased from $15,400 to $19,400 (26.0%),
the number of debtors with debts over $50,000 increased substantially, from
2,400 to 125,700.[44]
Student loans are treated as an asset in budgetary terms,
and hence this increase does not directly reflect in budget outlays. However, a
proportion of the loans are not expected to be repaid, and the resulting write
down of the value of the loan asset is recorded as an outlay. Debt is not
repaid because HELP debts are written off at death. As HELP debt repayment is
income contingent, any debtor who has low or no earnings during their lifetime
will not repay their debt. The amount of new debt not expected to be repaid has
been increasing, reaching an estimated 23% for 2016–17.[45]
As HELP debt is only indexed at the rate of the Consumer
Price Index (CPI) (and hence, in real terms is an interest-free loan) the
Government also effectively subsidises the loans as it carries the loan at a
real interest rate. The Grattan Institute has estimated this subsidy at $380
million for 2014–15.[46]
Hence a rapidly increasing loan debt and an increase in the proportion of debt
not being repaid both represent budgetary challenges.
Measures to
reduce unpaid debt
The Government has already implemented some measures to
increase the rate of repayment of HELP debt. One 2014–15 Budget measure which
has been legislated introduced a new lower minimum repayment threshold with a
reduced repayment level of 2%.[47]
This measure commences in the 2018–19 tax year but was only expected to produce
savings of $3.3 million over four years.[48]
In addition, debtors who moved overseas and were not
Australian taxpayers were previously not required to make any repayments. A
2015–16 Budget measure to recover repayments from debtors resident overseas has
also been legislated, with the first payments due for the 2016–17 tax year.[49]
This measure is expected to produce savings of $26.0 million over four years.[50]
While these measures are expected to have some effect on
reducing the non-repayment of HELP debt, the impact is relatively minor.
Therefore this Bill proposes to significantly increase the number of debtors
who are required to make a repayment each year, by substantially lowering the
minimum earnings threshold at which repayments commence. In 2014–15 there were
2.2 million HELP debtors, of whom 1.6 million lodged a tax return, with less
than 340,000 having sufficiently high incomes to repay any of the debt.[51]
The changes to the repayment thresholds in this Bill are estimated to bring an
additional 183,000 debtors into the repayment system in 2018–19.[52]
In combination with the measures already introduced, this would mean that the
proportion of new debt not expected to be repaid will be reduced from 23% to
17% (for 2016–17 and 2017–18 respectively).[53]
This still leaves a significant proportion of HELP debt
not being repaid due to the debt being written off at death, unlike most social
security and tax debts. Many of those who will die with unpaid HELP debt are likely
to be from wealthy households. For example, the Grattan Institute has estimated
that, based on 2011 data, 38% of partnered female graduates earning less than
the repayment threshold had partners who earned more than $100,000 a year.[54]
In addition, a small number of students aged over 60 are studying at
universities, with some 6,000 studying courses in 2015 for which HELP loans
were available.[55]
It is likely that many of these students will not have taxable earnings high
enough to repay their loans, although they may have significant wealth in
superannuation and other assets.
The Grattan Institute estimated that recovering debt from
estates worth over $100,000 in value would save up to $2.8 billion over three
years.[56]
While the Government canvassed this and other options in its consultation
paper, it has chosen not to consider the proposal at this stage, but has
instead focussed on increasing the repayment levels of those in the labour
force.[57]
The potential
impact of changes to HELP repayment arrangements
There have been a number of changes to repayment
arrangements since the introduction of the Higher Education Contribution Scheme
(HECS) in 1989. Appendix A provides details of the thresholds and rates that
have applied from then until the 2016–17 tax year.
The original HECS arrangements were based
on the recommendations of the Wran Committee.[58]
In determining the threshold at which students should start
repaying their debt, the Committee recommended that the level be set such that
even with their repayments, people would be better off than those on average
annual earnings.[59]
In fact, when HECS was first introduced, the minimum
payment threshold was somewhat lower than this, at 84.4% of average weekly
ordinary time earnings for adults working full time (AWOTE), with a payment rate
of 1.0%.[60]
Someone earning AWOTE would have had a repayment rate of 2.0%. After a number
of changes in following years, the current arrangements were introduced in
2004–05, with the minimum repayment threshold set at some 68.7% of AWOTE, with
a repayment rate of 4.0%. Someone earning AWOTE would have had a repayment rate
of 6.0%. Indexation has meant that these relativities have largely remained
unchanged. The new lower threshold of $51,957, which has already been
legislated for 2018–19 with a repayment rate of 2.0%, is set at a level of
around 62% of AWOTE.
The Bill proposes to reduce the minimum repayment
threshold for the 2018–19 tax year even further to $42,000 (around 50% of
AWOTE), with a repayment rate at this income of 1.0%. The repayment rate will then
increase by 0.5% for each extra 6.0% of income, up to a level of 10.0% to apply
to all those earning more than $119,881.[61]
The highest repayment rate under current arrangements is 8.0% which would be
payable on incomes of an estimated $107,214 or higher in 2018–19.[62]
Someone earning AWOTE will have a repayment rate of 7.0%.
The impact of the proposed changes compared to the
legislated arrangements at each income level is shown in Figure 1 below.
Figure 1: current
legislated and proposed HELP repayment thresholds and rates, 2018–19 tax year
Source: Parliamentary Library based on G Jericho, ‘Why the Coalition’s university changes
are just a great big new income tax’, The Guardian, 4
May 2017.
HELP debt repayment operates in the same way as the
Medicare levy, rather than as an increase in marginal tax rates. Therefore, for
the 2016–17 tax year, someone with an income of $54,488 pays no HELP repayment,
whereas someone earning $1 more pays $2,179.60 (a 4.0% repayment rate), plus an
extra 34.5 cents in additional taxation (and Medicare levy). The introduction
of a 2.0% repayment threshold reduces this impact slightly, but still leaves
something of a ‘cliff’ effect at the first two income thresholds, meaning that
those slightly above each threshold are considerably worse off than those just
below them. The proposals in the Bill to introduce a 1.0% repayment at the
lowest threshold and then have increments of 0.5% will significantly reduce
this effect.
When compared to the existing legislated arrangements, the
new proposal has a disproportionate impact on lower income earners but also produces
a small group of ‘winners’ at slightly higher income levels (see Figure 2
below). Those on incomes between $50,022 and $51,956 will be the most heavily
affected, with an increase in tax of 2.5% over existing arrangements, while
those with incomes between $57,730 and $59,576 would actually be 0.5% better
off under the new proposals.
Figure 2: change
in tax rate between legislated and proposed repayment arrangements, 2018–19 tax
year
Source: Parliamentary Library based on G Jericho, op. cit.
As noted earlier, the Base Funding Review commissioned a
study by Deloitte Access Economics on the impacts of the increased student
contributions and reduced loan repayment thresholds, which found that the
reforms in 1997 and 2005 appeared to be linked to a reduction in the number of
university applications, with those from low SES backgrounds more affected.[63]
As noted above, other studies have not found any sensitivity to increasing
student contributions, so there is some concern that the reduction in repayment
thresholds is a potential disincentive. The Base Funding Review therefore
recommended that ‘the repayment threshold not be lowered to a level that might
deter participation’, but did not suggest what such a level might be.[64]
There is also a potential economic impact of a 1.0% to
2.5% levy on those earning between 50% and 60% of average incomes. Firstly,
there is the reduction in disposable income of between $420 for those on
$42,000 and $1,299 for those on $51,956. Many earning these lower incomes are
in the early stages of their careers and are also trying to save for house
purchases or to start a family. Others are second earners in a household, working
part-time while caring for children.
It should also be noted that in addition to their HELP
debt, many students also acquire private debt while studying to cover living
costs. A 2012 study of student finances found that more than 25% of full-time
and 30% of part-time domestic students in undergraduate degrees had a private
debt.[65]
The study estimated that on completion of their studies, the average full-time
undergraduate had a non-HELP debt of some $7,700, of which $1,400 (17.8%) was
interest free (typically debts from family members). For part-time
undergraduates the average debt level was $24,200, of which only $700 (3.0%)
was interest free. The debt levels of those from low SES backgrounds were
considerably higher at $12,200 for full-time students and $34,005 for those
studying part time, and a lower proportion of these debts were interest free.
Therefore it is probable that many of those starting out
their careers on relatively low incomes are also repaying personal debts.
Increasing HELP debt repayments for those on moderate
incomes may add to other factors, such as the progressive withdrawal of social
security benefits due to income testing, to produce very high effective
marginal tax rates. One commentator suggests for example:
... low income couples in which one partner has left university
and the other is still studying face effective marginal tax rates north of 97
per cent as they attempt to lift their incomes beyond $37,000. The high rates
persist, peaking at 99.2 per cent, almost all the way up to $50,000.[66]
Such high marginal tax rates may prove a disincentive for
workers to increase their hours of work, or for some to return to the workforce,
and alternatively provide an incentive to manage tax arrangements. There is
already some evidence that debtors manage their tax incomes in order to avoid
or lessen HELP repayments.[67]
Funding of
enabling, sub-bachelor and postgraduate coursework courses
The current ‘demand driven’ funding system provides a CSP
for every domestic bachelor degree student admitted to a public university,
with the only restriction applying in relation to students in medical degrees.
Funding is provided for courses at a lower level and for postgraduate
coursework places through allocation of designated places to particular
institutions for particular courses. The Bill proposes to change the
arrangements under which this funding is allocated.
Enabling
courses
Enabling courses are offered to students who need
additional support to reach the standard required for entry to a bachelor level
course. At present, funding for allocated places is provided at the same level
as for CSPs (that is depending on the field of study), and in addition, a
loading is applied in lieu of a student contribution. For 2017, the loading was
$3,223.[68]
The Government is proposing to abolish this loading from 1 January 2018 and
replace it with an equivalent student contribution, which students may pay for
through a HELP loan.
The rationale for this change is partly that at present
students who undertake full fee enabling programs have a higher retention rate
than those in programs receiving full government funding.[69]
Presumably the view is that those students prepared to partially fund their
studies may have a higher level of commitment, although there is some
suggestion that the full cost courses are meeting a different need and hence
this comparison of retention rates is not valid.[70]
However, given that the target group for enabling programs are students from
disadvantaged backgrounds, the prospect of a fee (albeit payable with a HELP
loan) may deter some students from participating in such courses.
The Government has also suggested that, like other
students, participants in enabling courses should contribute to the cost of
their education. However, there is no information on the perceived public and
private benefits of undertaking such courses are in order to determine what an
appropriate contribution might be.
From 1 January 2019, the Government is also proposing new
arrangements for the allocation of funded enabling courses, with places to be
allocated through a competitive tender process.[71]
At this stage there is no information about how this process will operate.
Sub-bachelor
degrees
As with enabling courses, at present the Government
allocates CSPs for sub-bachelor courses (diploma, advanced diploma and
associate bachelor level) to public universities for specific courses. While
the number of such courses funded by the Government has increased from under
8,000 in 2007 to over 19,000 in 2016, the allocation of specific places has
meant that some courses may be under-enrolled, while others have unmet demand.[72]
While courses at this level fulfil a range of functions,
including providing shorter qualifications in specialised areas such as
languages or music, many are pathway courses, providing those with concerns
about their ability to undertake a bachelor level course with a lower risk entry
option, which then articulates to a higher level course. One concern in
limiting access to these courses is that students who would be better suited to
such a pathway but are unable to obtain a CSP, and hence would be required to
pay the full cost of their tuition, may instead enrol in a bachelor level
course on cost grounds.[73]
Although it had some concerns about the potential for
cost-shifting from the VET sector, which also provides courses at this level,
the Kemp-Norton Review recommended extending the demand driven system to
sub-bachelor higher education courses.[74]
This measure was included in the 2014–15 Budget proposals but not legislated.
The current Bill proposes to extend eligibility for CSP
funding to all students in approved sub-bachelor courses who have not
previously completed another higher education qualification. Courses must also
have been developed with a focus on industry needs and fully articulate into
related bachelor programs.[75]
These limitations seek to address the concerns about the potential overlap with
VET courses, while removing the disincentives for underprepared students to use
such courses as an entry point to higher education.
Postgraduate
coursework degrees
CSPs for postgraduate coursework degrees are also
allocated to particular universities for particular courses, leading to similar
problems with allocations not responding to demand. In addition, the
Kemp-Norton Review noted that this had led to the situation where students
undertaking a particular course at one university may be allocated a CSP while
someone undertaking the same course at another university in the same city
would be required to pay full cost for the course.[76]
To address this problem, the Government is proposing that,
from 2019, instead of allocating CSPs, the places will be awarded to students
in the form of postgraduate scholarships, which they can then use to study at
the university of their choice, so long as the institution is approved to offer
CSPs. There are no details as yet as to how these scholarships will be awarded,
but the Government has suggested it will target areas of national priority in
its allocation of these scholarships.[77]
The Government has noted that this arrangement will
require the negotiation of transition arrangements with the University of
Melbourne and the University of Western Australia, both of which have moved to
a model of a broad bachelor degree to be followed by a specialist masters
course, rather than the specialist undergraduate degrees offered by other
universities in most fields.[78]
Changed
arrangements for permanent residents and New Zealand citizens
At present, most Australian permanent residents and New
Zealand citizens are eligible for CSPs, but not for HELP loans. Hence, while
they receive subsidised tuition on the same basis as domestic students, they
are required to pay the student contribution upfront. The Government notes that
this presents a significant barrier to higher education for many students.[79]
Therefore, the Bill proposes extending access to HELP
loans to students in this situation, but at the same time removing access to
CSPs. Therefore, they will effectively be treated the same as domestic full-fee
paying students. Students already in a CSP will remain covered by the existing
arrangements for the duration of their course.[80]
As FEE-HELP loans (which are those available to full-fee
paying students) attract a 25% loan charge this will mean that these students
would pay considerably more for the cost of their education than at present,
but are able to defer payment until their income reaches the repayment
threshold.[81]
For example, a permanent visa holder studying engineering
in 2017 is required to pay an upfront student contribution of $9,050. If the
proposed arrangements had applied in 2017, they would be required to either pay
$27,021 upfront, or take out a FEE-HELP loan for $33,776 (the upfront fee with
a 25% loan fee).[82]
While access to FEE-HELP does remove the barrier that
upfront payment of student contributions now imposes, the significantly higher
costs of education, albeit with delayed repayment, may prove an even greater
disincentive for many students.
Committee
consideration
Senate
Education and Employment Legislation Committee
The Bill has been referred to the Senate Education and
Employment Legislation Committee for inquiry and report by 9 August 2017.
Details of the inquiry are available from the inquiry
homepage.[83]
Senate
Standing Committee for the Scrutiny of Bills
On 14 June 2017, the Committee reported that it had no
comment on the Bill.[84]
Policy
position of non-government parties/independents
Labor has described the proposed changes to student fees
and loan arrangements as ‘[saddling] young Australians with a
big uni debt at the same time as they are trying to buy a house, or start a
family’, and stated ‘Labor will never support this’.[85] Similarly, the
Australian Greens ‘have pledged to use their power in the
Parliament to protect Australia’s higher education sector from any further
funding cuts’.[86]
Senator Hanson previously introduced
amendments to the VET Student Loans Bill 2016 seeking to reduce the HELP
repayment threshold to $22,000 and limiting loan amounts to less than the
course fees so that students would be required to pay some contribution
upfront.[87]
More recently she has reiterated her proposal to reduce the payment threshold
to $22,000.[88]
On the other hand, Senator Lambie has
been reported as expressing the view that the $42,000 threshold is too low.[89] Also, in her response to
the 2016–17 Budget, she stated that ‘[i]f the JLN holds the balance of power
after the 2 July election, I will fight for every Australian to have a free
first degree
and I would push to uncap the number of two-year associate degrees in
this country’.[90]
Senator Hinch has also been reported as saying that he
considers the $42,000 threshold appears to be too low, but has also expressed
concern at the high level of write-down of HELP debt.[91]
Position of
major interest groups
The peak body for universities, Universities Australia,
initially expressed concern at the cuts to revenue for universities, but
welcomed the proposals relating to HEPPP, the extension of the demand-driven
system to sub-bachelor degrees and the funding for work experience units.[92]
However, after further consideration an ‘over-whelming majority of
Vice-Chancellors agreed they could not recommend that the Senate crossbench
pass the legislative package’.[93]
The Innovative Research Universities (IRU), Australian
Technology Network (ATN) and Regional Universities Network (RUN) have made
submissions to the Senate inquiry into the Bill. IRU raises concerns about the
efficiency dividend, student fee increases, performance funding, and the
introduction of the postgraduate coursework scholarship system, stating ‘perversely,
the proposal is to cut Commonwealth Grant Scheme funding for university
students by ten percent—literally to decimate it’.[94]
ATN gives qualified support for the Bill’s emphasis on industry linkages,
educational outcomes and accessibility, but notes ‘serious concerns about
asking students to pay more at the same time as asking universities to deliver
more with less, because ultimately this will lead to diminishing returns’.[95]
RUN contends that the Bill could result in perverse consequences for its member
universities, including ‘further lowering the participation rate of regional
students in higher education; and detrimental economic and social impact in
regional Australia’.[96]
While the Group of Eight (Go8) have not made a submission
to the inquiry, in his National Press Club Address on 28 June Go8 Chair Peter
Hoj said of the Bill ‘the Go8 board comprising all eight Vice-Chancellors and
the Chief Executive therefore sees this overall package as detrimental to
Australia’s interests, and urges the Senate to block it’.[97]
Universities have also expressed concern over how the
arrangements for postgraduate coursework scholarships would operate, including
a lack of detail over who would assess the students and award the scholarships,
and whether there would be a set number of scholarships in each discipline.[98]
Peak bodies for non-university higher education providers,
the Council of Private Higher Education (COPHE) and Australian Council for
Private Education and Training (ACPET), have also made submissions to the
Senate inquiry. Both recommend amendments to the Bill to align Commonwealth tuition
support for their students with that available to students at public
universities.[99]
The National Tertiary Education Union (NTEU) also
condemned the cuts and increase in student fees, stating ‘Australian students
already pay amongst the highest fees, and yet our public investment in higher
education is the second lowest according to the OECD’s latest data’.[100]
The NTEU also considered the cuts ‘will not only compromise the quality of
teaching, research and community service our universities can offer, they will
also contribute to de-professionalising academic work, and placing our
much-envied international reputation at risk’.[101]
The National Union of Students (NUS) has responded
negatively to the proposed reforms, holding a national day of protest on 17 May.
The NUS has also suggested that women, young people, and students from low
socio‑economic status backgrounds will be disadvantaged by the changes.[102]
Financial
implications
The Government has not provided a breakdown of the
financial implications of each of the measures. The Explanatory Memorandum
notes that the Bill implements the revised higher education package, which will
deliver savings of $3.8 billion in fiscal balance terms over the period 2016–17
to 2020–21.[103]
It also states that the underlying cash saving is $2.8 billion over 2017–18 to
2020–21.[104]
The proposals contained in the Bill were grouped into two
measures in the 2017–18 budget papers. Extending the demand driven system to
sub-bachelor degrees for those who have not completed another higher education
qualification, introducing a scholarship for postgraduate coursework places,
and expanding the CGS to cover specified work experience units is expected to
provide savings of $94.0 million over the forward estimates.[105]
It appears the savings come from an associated reduction of around 3,000 in the
number of postgraduate coursework places being funded, in line with current
utilisation—a measure that does not require legislation.[106]
The proposed introduction of a performance and reward
system using funds from the CGS and reforming the HEPPP involve reallocation of
existing funding, although the introduction of a loading for low SES students
as part of the revised HEPPP may have funding implications depending on enrolment
levels.
The proposed changes to the student and government
contributions to course funding, ceasing the government loading for enabling
courses and replacing them with a student contribution payable through HELP,
revising the repayment arrangements for HELP and changing the access to CSPs
and HELP for most permanent visa holders and New Zealand citizens are expected
to achieve savings of $3.8 billion over five years.[107]
Statement of Compatibility with Human Rights
As required under Part 3 of the Human Rights
(Parliamentary Scrutiny) Act 2011 (Cth), the Government has assessed the
Bill’s compatibility with the human rights and freedoms recognised or declared
in the international instruments listed in section 3 of that Act. The
Government considers that the Bill is compatible.[108]
Parliamentary
Joint Committee on Human Rights
The Committee examined the Bill in its report of 14 June
2017.[109]
It sought the advice of the Minister about the compatibility of the key
measures in Schedules 1-4 with the right to education under Article 13 of the International
Covenant on Economic, Social and Cultural Rights.[110]
In particular, the Committee sought the advice of the Minister about the
evidence base supporting the proposed measures, and their rational connection
and proportionality to a legitimate objective for the purposes of human rights
law (including details of whether any alternative measures were considered). It
also sought the advice of the Minister as to how the key measures comply with
Australia's obligation to use the maximum of its available resources to
progressively introduce free higher education.[111]
Further, the Committee sought the Minister’s advice about
the compatibility of some proposed measures with the rights to equality and
non-discrimination under Articles 2 and 26 of the International Covenant on
Civil and Political Rights.[112]
The Committee was concerned about the differential treatment of Australian
permanent residents and New Zealand citizens (apparent direct discrimination on
the basis of nationality) and women (potential indirect discrimination, as the
changes in indexation may have a disproportionate effect on women).[113]
At the time of writing, the Committee had not reported on
a response from the Minister.[114]
Key issues
and provisions
Schedule 1—costs
of higher education
This Schedule seeks to increase the costs to
students of undertaking courses in CSPs, and applies an efficiency dividend to
the funding received by universities for these places. In addition, it extends
the current medical student funding loading to dental and veterinary science
students.
Additional
loading for high cost courses
The study of tuition costs undertaken by Deloitte found
that while many courses received more funding than the costs of tuition, both
dentistry and veterinary science courses were significantly underfunded.[115]
Therefore the Government is proposing to address this shortfall, by extending
the current medical student loading to dentistry and veterinary science courses
from 2018. Items 1 and 2 of Schedule 1 replace ‘medical student
loading’ with ‘medical, dental and veterinary science student loading’ in the
relevant sections of the Act to give effect to this proposal.[116]
Changes to
funding arrangements for Commonwealth supported places (CSPs)
Item 3 proposes new Commonwealth funding levels for
each cluster for 2021 and later years.[117]
These levels reflect both the reduction in Commonwealth funding due to increasing
the student contribution, and also the 2.5% efficiency dividend in each of 2018
and 2019, plus the expected level of indexation for 2018. This proposal
necessitates a change to the definition of ‘Commonwealth contribution amount’,
which is at item 8.
The maximum student contribution levels for each cluster
proposed for 2018 (except for students in enabling courses) are set out in item
4. These levels represent a 1.8% increase above those applying for 2017, as
well as incorporating an expected level of indexation. It should be noted that
universities are not required to charge the full student contribution, as the
legislation only specifies these as the maximum level of contribution. However,
in general these are the levels charged by universities in order to meet course
costs. Again there is a consequential change in the definition of ‘maximum
student contribution’ from this proposal (item 9).
Item 5 introduces a new maximum student
contribution for places in enabling courses at $3,271 for 2018, regardless of
the field of study.[118]
As noted above, students are currently not required to contribute to their
tuition costs for these courses, and instead the courses receive a loading in
addition to the standard Commonwealth contribution. These student contributions
for enabling courses will not be subject to the 7.5% (over four years) increase
applying to other student contribution levels (proposed subsection 93-10 (5)).
Proposed subsection 93-10 (4) applies an increase
of 1.824% each year for 2019, 2020 and 2021 to the maximum student contribution
for other CSPs. Together with the increase incorporated into the proposed
levels for 2018, this represents an increase of 7.5% over four years.
Part 2 of Schedule 1 specifies proposed transitional
arrangements, which includes, at item 12, the Commonwealth contribution
levels (amounts) which will apply for 2018, 2019 and 2020, and that indexation
will only apply to any of the amounts specified (including the student
contribution levels) from 2019 (but not for 2018) (item 14).
Schedule
2—Commonwealth Grant Scheme
Part 1—enabling
and sub-bachelor courses and work in industry
Items 1, 2 and 7 propose removing the references in
the HESA to the loading for enabling courses, reflecting the changed
funding arrangements for these courses proposed in Schedule 1, item 5 (see
above).
Under current arrangements, universities do not receive
funding for students who are undertaking work experience in industry (WEI) units
as part of a Commonwealth supported qualification. This affects around 2,600
students per annum.[119]
The Government has recognised that these courses are valuable in developing
employability skills and in enabling employers to provide feedback to universities
on student learning and preparedness for employment.[120]
On this basis, it is proposing to extend funding to WEI units that meet certain
criteria as specified in the Administration Guidelines, including that WEI
units cannot exceed one sixth of the total load[121],[122]
(item 3).
As discussed above, the proposed extension of Commonwealth
funding to sub-bachelor courses (items 4 and 6), where students have not
previously obtained a higher education award, is designed to facilitate
students from educationally disadvantaged backgrounds to undertake an
introductory higher education course, prior to enrolling in a bachelor-level
program.
Part 2—amendments
generally applying from 1 January 2019
Items 15, 16 and 18 propose that eligibility for
the CGS and HECS-HELP assistance be extended to students studying at the
Australian branch of a Table C provider. Table C providers are approved
overseas universities with branches in Australia. At present the only Table C
providers are Carnegie Mellon University and the University College London (HESA,
section 16-22). Under this proposal, these providers would not be part of the
demand driven system for bachelor level courses, but may receive allocated
places for designated courses, such as enabling units or for recipients of the
proposed postgraduate coursework scholarships.
Item 17 seeks to ensure that students in receipt of
one of the proposed scholarships for postgraduate coursework study (see discussion
above under ‘Background’) are not discriminated against in university selection
processes. This is to ensure that where a university’s full cost fees are
higher than the amount they would receive through CSP funding, they cannot
reject applications from scholarship holders on this basis.
Currently funding is only provided to approved higher
education providers who are not public universities for allocated places that
meet national priorities. Item 19 proposes to extend eligibility for
funding for enabling courses and non-medical postgraduate coursework places to
these institutions, reflecting the proposed changes to funding applying to
these courses. Items 20 to 28 propose consequential amendments to give
effect to these changes.
The Government proposes to withhold 7.5% of CGS cluster
funding, to be allocated on a performance basis.[123]
While the total Commonwealth CGS cluster funding will remain the same,
universities will only be guaranteed 92.5% of the amount derived from the
cluster funding formula. Access to the remaining funds will be linked to
performance. For 2018, to be eligible for these funds universities will be
required to participate in a reform of admissions information and a project on
the cost of teaching and research.[124]
From 2019, there will be additional performance metrics applied according to a
formula to be developed in consultation with the sector during 2017–18.[125]
No details have been provided on the types of measures that may be included in
this formula.
Items 29 to 32 and item 34 therefore propose the
concepts of ‘unadjusted’ and ‘adjusted’ grant amounts, to replace ‘basic’ grant
amounts, where unadjusted grant amounts are calculated according to the
existing formula for basic grant amounts. Adjusted grant amounts take into
consideration the performance of the provider against criteria specified in the
Commonwealth Grant Scheme Guidelines[126],
and may be more or less than the unadjusted grant amount. However, the adjusted
grant amount cannot be less than 92.5 % of the unadjusted amount (proposed
paragraph 33-7(3)(b)).
Items 36 to 42 propose changes to introduce a
scholarship places scheme to replace the current CSP arrangements for certain
postgraduate coursework programs as described above. The details of the
proposed scheme are to be specified in the Commonwealth Grant Scheme Guidelines.
Items 48 and 49 propose amendments to the Income Tax Assessment Act
1997[127]
to exempt grants payable under this scheme from income tax.
Part 3 specifies the dates from which the
provisions relating to work experience units, enabling courses, sub-bachelor
degrees, performance funding and the scholarship places scheme apply, and
transitional arrangements where required. Most of the provisions commence on 1
January 2018, except those relating to postgraduate coursework places, which
commence on 1 January 2019. Item 54 specifies the arrangements for
performance contingent funding for 2018.
Schedule
3—Higher Education Loan Program
Changes to
entitlements to Commonwealth supported places and the Higher Education Loan
Program
Part 1 proposes a number of changes to the
entitlements of certain permanent visa holders and New Zealand citizens. Under
current arrangements, all permanent visa holders and New Zealand citizens are
eligible for CSPs. However, only permanent humanitarian visa holders, and New
Zealanders holding a special category visa (SCV), who arrived in Australia as a
child and meet other residency requirements are eligible for HELP loans.
Therefore, as noted above, most permanent visa holders and New Zealand citizens
are required to pay their student contributions up front when enrolling in
higher education courses.
The Government is proposing to remove eligibility for CSPs
from most permanent visa holders and New Zealand citizens, but provide them
with access to HELP loans to pay for their fees.[128]
This will mean that these students will have to pay the full cost for their
courses, but will be eligible for a FEE-HELP loan rather than being required to
pay their contributions up front.
The Bill (items 1 to 7) proposes that eligibility
for a CSP be restricted to those residing in Australia for the duration of
their unit who fall within one of the following categories:
- permanent
humanitarian visa holders
- persons
who commenced their course of study of which the unit is a part as a permanent
humanitarian visa holder and now hold a permanent visa for the duration of the
unit or
- New
Zealanders holding an SCV, who began residing in Australia as a dependent child
at least ten years previously, and have resided in Australia for at least:
- eight
of the last ten years and
- 18
months of the most recent two-year period.
There is grandfathering (that is, continued eligibility
under the current arrangements) for persons who were eligible under the current
citizenship and residency requirements when they commenced their course prior
to 1 January 2018, while they remain in the same course, up until 1
January 2023 (item 46).
Item 8 proposes extending the eligibility for HECS-HELP
loans to those in enabling courses, as under the provisions of Schedule 2
these students would be charged a student contribution.
The proposed criteria for eligibility for HECS-HELP loans
are set out in items 9 to 14, and reflect the eligibility requirements for
CSPs. It is also proposed that these students are eligible for OS-HELP, which
provides loans to students undertaking study overseas as part of their course (items
21 to 24).
Changes to eligibility for FEE-HELP loans are proposed in items
15 to 20 to ensure that students who meet any of these criteria are also
eligible for FEE-HELP, while items 25 to 30 propose extending
eligibility to SA-HELP loans, which provide loans to pay for student services
and amenities fees. In addition, eligibility for both these loans is proposed
to be extended to all permanent visa holders and New Zealand citizens who are
resident in Australia for the duration of their unit of study.
VET Student Loans provide income-contingent loans to
students studying approved courses in the VET sector.[129]
Items 31 to 33 propose amendments to the VET Student Loans Act 2016[130]
to align eligibility for these loans to the eligibility for FEE-HELP loans.
Student
loan repayment arrangements
Part 2 proposes amendments to the arrangements for
the repayment of HELP and VET Student Loan debts, to reduce the income level at
which repayment commences, and to introduce new repayment rates for each income
level. As Trade Support Loans and Student Start-up Loans all use the same repayment
schedules as are in HESA, these proposed changes will also affect those
with other student loans.[131]
As noted above, previous legislation reduced the minimum
repayment threshold to $51,957 for the 2018–19 tax year, with a repayment rate
of 2.0%.[132]
Item 35 proposes a new minimum repayment income of $41,999 for the
2018–19 income year, while item 36 proposes a new table of the
applicable repayment percentage for each band of repayment income.
The current repayment income thresholds are indexed each
year in line with changes in the seasonally adjusted AWE for all employees. As
noted earlier, the Government has stated that the ‘thresholds have been rising
relative to [graduate] earnings. Relatively fewer people are now making
repayments than in the past’.[133]
Therefore the Government is proposing to change the indexation to align with
changes in the CPI (items 37 and 38). This would also
bring indexation of the repayment threshold in line with indexation
arrangements applying to other sections of HESA. Therefore the specific
indexation arrangements for the HELP amounts contained in section 140-15
of HESA are no longer required (item 34).
Historically wages have generally increased at a faster
rate than prices (as measured by the CPI), and hence moving to indexation by
the CPI would be expected to provide a slower rate of growth in the repayment
thresholds.[134]
However, more recently wages growth has slowed, with the latest figures showing
the AWE increasing by only 1.6% for the year to November 2016, compared to
annual CPI growth of 2.1%.[135]
Therefore there is a possibility that in the short term, until wage growth
picks up, this change in indexation will actually reduce the number of payees
even further.
Schedule 4—other
grants
The HEPPP provides funding to universities to implement
strategies to increase the access, retention and completion rates of students
from low SES backgrounds. It consists of three components:
- participation,
under which universities receive funding based on the number of enrolments from
students from a low SES background
- partnerships
funding, for projects which aim to raise the aspirations and build capacity of
low SES students through partnerships with schools, VET providers, other
universities, state and territory governments, or community groups and
- the
National Priorities Pool, which provides funding for projects which seek to
increase the effectiveness of HEPPP and support for low SES students more
generally.
At present this funding is provided under Division
41—Other grants of HESA and the guidelines for its operation are
contained in the Other Grants Guidelines (Education) 2012.[136]
Under these Guidelines, a total funding pool is allocated for participation and
partnerships, with 25% allocated to the partnerships component. Participation
funding is determined on a pro-rata basis to universities, depending on the
proportion of the total low SES student load at each university. For 2016,
$155.1 million was distributed in participation funding.[137]
Funding for the National Priorities Pool is determined on an annual basis.
An evaluation of the HEPPP was undertaken in 2016–17,
which found that overall the program appeared to have been successful and
recommended that it continue, but suggested increasing incentives around
retention and completion rates.[138]
In response, the Government is proposing to reform HEPPP into two components:
the Access and Participation Fund, and the National Priorities Pool.[139]
The Access and Participation funding is proposed to be provided in two streams:
- a
loading per low SES student and
- performance
funding, which will be allocated to universities that improve their average
success rate for low SES or Indigenous students.[140]
Universities will be required to allocate a minimum amount
of this funding to partnership activities.[141]
In Schedule 4 the Government is proposing to
specifically legislate for HEPPP to provide greater funding certainty for
universities and to establish these revised funding arrangements.
Items 1 to 16 propose amendments to Division 41 of HESA,
which relates to other grants, to specifically reference the proposed Division
42 which deals with HEPPP and also include references to the proposed HEPPP
Guidelines.
Proposed section 42-10 sets out the three different
forms of funding available under HEPPP (the Program), specifies the objectives
of the Program and provides that the HEPPP Guidelines may specify matters
including eligibility and conditions for grants under the Program. The arrangements
for the low SES loadings component are described in proposed section 42-20,
including that the loading amount will be $985. Proposed section 42-25
provides for performance payments for improved outcomes, and specifies funding
of $13.3 million for this purpose, and the National Priorities Pool
funding of $9.5 million is provided for in proposed section 42-30.
All amounts are to be indexed as per other amounts in HESA, that is,
linked to the CPI (item 18).
Other provisions
Schedule 5 contains minor technical amendments to HESA
including reflecting name changes for the University of Technology Sydney and
the University of Divinity.
Concluding comments
The Government remains concerned at the rising cost of
funding students in CSPs, both through increased direct funding and an
increasing amount of student loan debt being written off. If implemented, the
measures in this Bill are expected to produce savings of $3.8 billion over
five years.
These savings are largely through increasing the
proportion of education costs that students pay, and reducing the funding
available to universities for tuition costs by some 2.8% on average.
While other measures in the Bill seek to increase the
access to, and success in, higher education by those from disadvantaged
backgrounds, there is some evidence that this may be offset by the negative
impact of increasing fees and repayment requirements.
The worst affected by these changes are those in the
workforce with a student debt who are on relatively low incomes (50% to 60% of
AWE), some of whom will have marginal tax rates at around 100%.
It is interesting that the Government has chosen to claw
back funding from this group rather than implement changes to recover unpaid
student loan debts from estates worth over $100,000—a measure which has been
estimated could save up to $2.8 billion over three years.[142]
Appendix A: HELP repayment thresholds(a) and rates and Average
Weekly Earnings (AWOTE): 1988–89 to 2016–17
1988–89 to 2003–04
Income year |
AWOTE
$pa(b) |
Repayment rate
($ per annum) |
|
|
Nil |
1% |
2% |
3% |
3.5% |
4% |
4.5% |
5% |
5.5% |
6% |
1988–89(c) |
26 057 |
21 999 |
24 999 |
34 999 |
35 000+ |
|
|
|
|
|
|
1989–90 |
27 318 |
23 582 |
26 798 |
37 518 |
37 519+ |
|
|
|
|
|
|
1990–91 |
29 026 |
25 468 |
|
28 941 |
40 519 |
|
40 520+ |
|
|
|
|
1991–92 |
30 319 |
27 097 |
|
30 793 |
43 112 |
|
43 113+ |
|
|
|
|
1992–93 |
30 800 |
27 747 |
|
31 532 |
44 146 |
|
44 147+ |
|
|
|
|
1993–94 |
31 764 |
26 402 |
|
|
30 004 |
|
42 005 |
|
42 006+ |
|
|
1994–95 |
33 236 |
26 852 |
|
|
30 516 |
|
42 722 |
|
42 723+ |
|
|
1995–96 |
34 710 |
19 999(d) |
|
27 674 |
31 449 |
|
44 029 |
|
44 030+ |
|
|
1996–97(e) |
35 942 |
20 593(d) |
|
28 494 |
30 049 |
32 381 |
37 563 |
43 335 |
47 718 |
51 293 |
51 293+ |
1997–98(e) |
37 344 |
20 700 |
|
|
21 830 |
23 524 |
27 288 |
32 934 |
34 665 |
37 262 |
37 263+ |
1998–99(e) |
38 922 |
21 333 |
|
|
22 498 |
24 244 |
28 123 |
33 942 |
35 726 |
38 402 |
38 403+ |
1999–00(f) |
40 037 |
21 983 |
|
|
23 183 |
24 982 |
28 980 |
34 976 |
36 814 |
39 572 |
39 573+ |
2000–01(f) |
42 039 |
22 345 |
|
|
23 565 |
25 393 |
29 456 |
35 551 |
37 420 |
40 223 |
40 224+ |
2001–02(f) |
44 270 |
23 241 |
|
|
24 510 |
26 412 |
30 638 |
36 977 |
38 921 |
41 837 |
41 838+ |
2002–03(f) |
46 667 |
24 364 |
|
|
25 694 |
27 688 |
32 118 |
38 763 |
40 801 |
43 858 |
43 859+ |
2003–04(f) |
48 571 |
25 347 |
|
|
26 731 |
28 805 |
33 414 |
40 328 |
42 447 |
45 628 |
45 629+ |
2004–05 to 2016–17
Income year |
AWOTE
$pa(b) |
Repayment rate
($ per annum) |
|
|
Nil |
4% |
4.5% |
5% |
5.5% |
6% |
6.5% |
7% |
7.5% |
8% |
2004–05(f) |
50 929 |
35 000 |
38 987 |
42 972 |
45 232 |
48 621 |
52 657 |
55 429 |
60 971 |
64 999 |
65 000+ |
2005–06(g) |
52 978 |
36 184 |
40 306 |
44 427 |
46 762 |
50 266 |
54 439 |
57 304 |
63 062 |
67 199 |
67 200+ |
2006–07(g) |
55 143 |
38 148 |
42 494 |
46 838 |
49 300 |
52 994 |
57 394 |
60 414 |
66 485 |
70 846 |
70 847+ |
2007–08(g) |
57 673 |
39 824 |
44 360 |
48 896 |
51 466 |
55 322 |
59 915 |
63 068 |
69 405 |
73 959 |
73 960+ |
2008–09(g) |
60 991 |
41 598 |
46 333 |
51 070 |
53 754 |
57 782 |
62 579 |
65 873 |
72 492 |
77 247 |
77 248+ |
2009–10(h) |
64 399 |
43 151 |
48 066 |
52 980 |
55 764 |
59 943 |
64 919 |
68 336 |
75 203 |
80 136 |
80 137+ |
2010–11(h) |
67 077 |
44 911 |
50 028 |
55 143 |
58 041 |
62 390 |
67 750 |
71 126 |
78 273 |
83 407 |
83 408+ |
2011–12(h) |
69 662 |
47 195 |
52 572 |
57 947 |
60 993 |
65 563 |
71 006 |
74 743 |
82 253 |
87 649 |
87 650+ |
2012–13(h) |
73 239 |
49 095 |
54 688 |
60 279 |
63 448 |
68 202 |
73 864 |
77 751 |
85 564 |
91 177 |
91 178+ |
2013–14(h) |
75 169 |
51 308 |
57 173 |
62 997 |
66 308 |
71 277 |
77 194 |
81 256 |
89 421 |
95 287 |
95 288+ |
2014–15(h) |
76 963 |
53 345 |
59 421 |
65 497 |
68 939 |
74 105 |
80 257 |
84 481 |
92 970 |
99 069 |
99 070+ |
2015–16(h) |
78 429 |
54 123 |
60 292 |
66 456 |
69 949 |
75 190 |
81 432 |
85 719 |
94 331 |
100 591 |
100 592+ |
2016–17(h) |
|
54 869 |
61 119 |
67 368 |
70 909 |
76 222 |
82 550 |
86 894 |
95 626 |
101 899 |
101 900+ |
Notes:
(a) Highest
income level at which rate is payable.
(b) Average
weekly ordinary time earnings for adults working full time (calculated as
average weekly ordinary time earnings for the two quarterly survey estimates
multiplied by 52 weeks).
(c) Introduced
from 1 January 1989, so repayment rates were at half the level of later years
(i.e. 0.5%, 1% and 1.5%).
(d) Repayment
at 2% rate was voluntary.
(e) Taxable
income plus net rental losses.
(f) As
per (e) plus total reportable fringe benefits amounts.
(g) As per (f)
plus exempt foreign employment income.
(h)
As per (g) plus any total investment loss (which includes net rental
losses), and reportable super contributions.
Source: Australian Taxation Office (ATO), ‘HELP,
SSL, ABSTUDY SSL, TSL and SFSS repayment thresholds and rates’, ATO
website, 9 May 2017; and ABS, Average
Weekly earnings, cat. no. 6302.0, Table 3, cat. no. 6302.0, ABS,
Canberra, 23 February 2017, Table 3.
[1]. Higher Education
Support Act 2003.
[2]. For
information on Commonwealth Supported Places see Australian Government, ‘Commonwealth
supported places’, StudyAssist website.
[3]. Grandfathering
arrangements mean that students currently enrolled in CSPs will be able to
continue in their current courses on this basis for up to five years. See Schedule
3, Item 46.
[4]. K
Andrews, ‘Second
reading speech: Higher Education Support Legislation Amendment (A More
Sustainable, Responsive and Transparent Higher Education System) Bill 2017’,
House of Representatives, Debates, 11 May 2017, p. 4324.
[5]. For
more detail on these measures see C Ey, Higher
Education and Research Reform Amendment Bill 2014, Bills digest, 33,
2014–15, Parliamentary Library, Canberra, 8 October 2014.
[6]. C
Pyne, ‘Second
reading speech: Higher Education and Research Reform Amendment Bill 2014’,
House of Representatives, Debates, 28 August 2014, pp. 8897–8.
[7]. Organisation
of Economic Co-operation and Development (OECD), Education
at a glance 2016: OECD indicators, OECD, Paris, 2016, Table B2.3:
expenditure on educational institutions as a percentage of GDP, by source of
funding and level of education (2013), p. 207.
[8]. S
Birmingham (Minister for Education and Training), The
challenge of world-class higher education: opening keynote address: Times
Higher Education (THE) world academic summit: University of Melbourne, speech,
1 October 2015.
[9]. Australian
Government, ‘Part
2: expense measures’, Budget measures: budget paper no. 2: 2016–17, p.
77.
[10]. Australian
Government, Driving innovation,
fairness and excellence in Australian higher education, Department of
Education and Training (DET), May 2016, p. 3.
[11]. S Birmingham (Minister for Education and Training), A stronger, sustainable and student-focussed higher education system
for all Australians, media release,
1 May 2017 and Australian Government, The higher education reform package, DET,
Canberra, May 2017.
[12]. Australian
Government, ‘Part
2: expense measures’, Budget measures: budget paper no. 2: 2017–18, pp.
77–78 and 83–84.
[13]. For
details see Australian Government, Allocation of units of study to funding clusters and student
contribution bands according to field of education codes 2017, DET,
Canberra, n.d.
[14]. Higher
Education Base Funding Review, Higher
education: base funding review: final report, Department of Education,
Employment and Workplace Relations (DEEWR), Canberra, October 2011, p. 99.
[15]. Australian
Government, The
higher education reform package, op. cit., p. 11.
[16]. Higher
education: base funding review: final report, op. cit., p. 53.
[17]. Tertiary
Education Quality and Standards Authority (TEQSA), Application
Guide for registration in any university category: new providers: registered
higher education providers: version 1.1, TEQSA, 1 January 2017, p. 5.
[18]. Higher
education: base funding review: final report, op. cit., p. 92.
[19]. D
Kemp and A Norton, Review
of the demand driven funding system: report, DET, Canberra, 2014, p.
74.
[20]. Deloitte
Access Economics, Cost
of delivery of higher education: Australian Government Department of Education
and Training: final report, report for DET, Deloitte Access Economics,
Canberra, December 2016, p. 39.
[21]. Ibid.
[22]. Ibid.
[23]. M
Warburton, ‘Many Australian universities may be in surplus, but does that mean
there’s fat to cut?’, The Conversation, 22 May 2017.
[24]. Australian
Government, The
higher education reform package, op. cit., p. 12.
[25]. Ibid.,
pp. 12–15.
[26]. Ibid.,
p. 10.
[27]. Parliamentary
Library calculations based on Australian Government, Allocation of units of study to funding clusters and student
contribution bands according to field of education codes 2017,
op. cit.
[28]. Deloitte
Access Economics, Estimating the public and private benefits of education,
quoted in Australian Government, The
higher education reform package, op. cit., p. 10.
[29]. Ibid.
[30]. Ibid.
[31]. See
for example, A Norton, Graduate
winners: assessing the public and private benefits of higher education,
Grattan Institute, Melbourne, August 2012; H Wei, Measuring economic returns to post-school education in Australia,
cat. no. 1351.0.55.032, Australian Bureau of
Statistics (ABS), Canberra, 30 August 2010; and A Daly, P Lewis, M Corliss and T Heaslip, ‘The
private rate of return to a university degree in Australia’, Australian
Journal of Education, 59(1), 2015.
[32]. Andrews,
op. cit., p. 10.
[33]. Graduate
Careers Australia (GCA), Graduate
salaries 2015: a report on the earnings of new Australian graduates in their
first full-time employment, GCA, Melbourne, 2016, p. 10.
[34]. GCA,
Graduate
destinations 2015: a report on the work and study outcomes of recent higher
education graduates, GCA, Melbourne, 2016, p. 7.
[35]. ABS,
Education
and work, Australia, May 2016, cat. no. 6227.0, ABS, Canberra, 2016, Table
29: highest non-school qualification: bachelor degree level or above, by age
and sex, 1982 to 2016; and ABS, Qualifications
and work, Australia, 2015, cat. no. 4235.0, ABS, Canberra, 2016, Table
1: non-school qualifications: selected characteristics, persons aged 15–64
years.
[36]. DET,
Completion rates of
higher education students: cohort analysis, 2005–2014, DET, Canberra,
2017, p. 23.
[37]. Deloitte
Access Economics, The
impact of changes to student contribution levels and repayment thresholds on
the demand for higher education, report prepared for DEEWR, Deloitte
Access Economics, 2011, p. iii.
[38]. Higher
education base funding review: final report, op. cit., p. 127.
[39]. For
more detail on the range of student loans and their introduction see C Ey, Higher
Education Loan Program (HELP) and other student loans: a quick guide, Research
paper series, 2016–17, Parliamentary Library, Canberra, 2 May 2017.
[40]. Australian
Government, ‘Loan
repayment’, StudyAssist website.
[41]. Ibid.
[42]. DET,
Higher
education report 2011–2013, DET, 2014, p. 121.
[43]. Australian
Government, The
higher education reform package, op. cit., p. 17.
[44]. Ibid.
[45]. Australian
Government, Portfolio
budget statements 2017–18: budget related paper no. 1.5: Education and Training
Portfolio, Commonwealth of Australia, Canberra, p. 55.
[46]. A
Norton, Mapping
Australian higher education 2016, Grattan Institute, Melbourne, 2016,
p. 47.
[47]. For
details see Parliament of Australia, ‘Budget
Savings (Omnibus) Bill 2016 homepage’, Australian Parliament website.
[48]. Explanatory
Memorandum, Budget Savings (Omnibus) Bill 2016, p. 5. The Bill originally
proposed the measure be introduced from the 2016–17 tax year.
[49]. For
details see Parliament of Australia, ‘Education Legislation Amendment (Overseas Debt Recovery) Bill 2015
homepage’, Australian Parliament website.
[50]. Australian
Government, Budget
measures: budget paper no. 2: 2015–16, p. 9.
[51]. Australian
Government, The
higher education reform package, op. cit., pp. 16–17.
[52]. Ibid.,
p. 16.
[53]. Australian
Government, Portfolio
budget statements 2017–18: budget related paper no. 1.5: education and training
portfolio, p. 55.
[54]. A
Norton and I Cherastidtham, Doubtful
debt: the rising cost of student loans, Grattan Institute, Melbourne, April
2014, p. 39.
[55]. Derived
from DET, Higher
education statistics: all students 2015, DET, Canberra, 2016, Table
2.2: All Domestic Students by Age Group and Broad Level of Course, Full Year
2015.
[56]. Norton
and Cherastidtham, op. cit., p. 44.
[57]. Australian
Government, Driving innovation,
fairness and excellence in Australian higher education, op. cit., pp.
21–2.
[58]. Committee
on Higher Education Funding, Report
of the committee on higher education funding, (the Wran report), Australian
Government, Canberra, April 1988.
[59]. Ibid.,
p. 58.
[60]. Calculations
in this section are based on the data in Appendix A.
[61]. Australian
Government, The
higher education reform package, op. cit., pp. 15–16.
[62]. Ibid.
[63]. Higher
education: base funding review: final report, op. cit., p. 126.
[64]. Ibid.,
p. 98.
[65]. All
figures in this paragraph are drawn from E Bexley, S Daroesman, D Arkovdis and
R James, University
student finances in 2012: a study of the financial circumstances of domestic
and international students in Australia’s universities, Universities
Australia, Canberra, July 2013, pp. 39 and 41.
[66]. P
Martin, ‘The
top tax rate myth’, The Age, 25 May 2017, p. 18.
[67]. R
Highfield and N Warren, ‘Does
the Australian Higher Education Loan Program (HELP) undermine personal income
tax integrity?’, eJournal of Tax, 13(1), March 2015, pp.
202–61, ProQuest database.
[68]. Australian
Government, The
higher education reform package, op. cit., p. 25.
[69]. Ibid.
[70]. A
Bennett, A Harvey and S Fagan, ‘Programs that prepare students for university study may no longer be free’, The Conversation, 18 May 2017.
[71]. Australian
Government, The
higher education reform package, op. cit., p. 25.
[72]. Kemp
and Norton, Review
of the demand driven funding system: report, op. cit., p. 57; and
Australian Government, The
higher education reform package, op. cit., p. 24.
[73]. Kemp
and Norton, Review
of the demand driven funding system: report, op. cit., p. 57.
[74]. Ibid.,
p. 60.
[75]. Australian
Government, The
higher education reform package, op. cit., p. 24.
[76]. Kemp
and Norton, Review
of the demand driven funding system: report, op. cit., p. 64.
[77]. Explanatory
Memorandum, Higher Education Support Legislation Amendment (A More
Sustainable, Responsive and Transparent Higher Education System) Bill 2017, op.
cit., p. 24.
[78]. Australian
Government, The
higher education reform package, op. cit., p. 24.
[79]. Ibid.,
p. 18.
[80]. Ibid.,
p. 18.
[81]. For
more information on the range of HELP loans see C Ey, Higher
Education Loan Program (HELP) and other student loans: a quick guide,
op. cit.
[82]. Based
on Australian Government, Allocation of units of study to funding clusters and student
contribution bands according to field of education codes 2017, op.
cit.
[83]. Senate
Education and Employment Legislation Committee, Higher Education Support Legislation Amendment (A More Sustainable,
Responsive and Transparent Higher Education System) Bill 2017 homepage.
[84]. Senate
Standing Committee for the Scrutiny of Bills, Scrutiny
digest, 6, 2017, 14 June 2017, p. 29.
[85]. T
Plibersek (Shadow Minister for Education), Liberal budget 2017: uni students to pay for $50 billion big
business tax cut, media release,
10 May 2017.
[86]. S
Hanson-Young, The Australian Greens stand with Australia's students and
universities, media release, 24 April 2017.
[87]. P
Hanson, ‘Second
reading speech: VET Student Loans Bill 2016, VET Student Loans (Consequential
Amendments and Transitional Provisions) Bill 2016, VET Student Loans (Charges)
Bill 2016’, Senate, Debates, 30 November 2016, pp. 3880–2.
[88]. J
Hare, ‘Make
students pay back debt at $22,000, says Hanson’, The Australian, 24
May 2017, p. 30.
[89]. Ibid.
[90]. J
Lambie, ‘Budget:
statement and documents: speech’, Senate, Debates, 4 May 2016, p.
3649.
[91]. J
Hare, op. cit.
[92]. Universities
Australia, Uni cuts aren't clever, but merit in new uni equity and work
placement measures, media release, 1 May 2017.
[93]. Universities
Australia, Statement on higher education proposals,
media release, 16 May 2017.
[94]. Innovative
Research Universities (IRU), Submission
to the Senate Education and Employment Legislation Committee, Inquiry into
the Higher Education Support Legislation Amendment (A More Sustainable,
Responsive and Transparent Higher Education System) Bill 2017, 8 June 2017,
p. 2.
[95]. Australian
Technology Network (ATN), Submission
to the Senate Education and Employment Legislation Committee, Inquiry into
the Higher Education Support Legislation Amendment (A More Sustainable,
Responsive and Transparent Higher Education System) Bill 2017, 8 June 2017,
p. 1.
[96]. Regional
Universities Network (RUN), Submission
to the Senate Education and Employment Legislation Committee, Inquiry into
the Higher Education Support Legislation Amendment (A More Sustainable,
Responsive and Transparent Higher Education System) Bill 2017, June 2017,
p. 1.
[97]. P
Hoj, A
not-so-radical way of securing future prosperity and cohesion for Australia:
enhance investments in the public’s innovation assets, National Press
Club Address, 28 June 2017.
[98]. D
O’Keeffe, ‘Uncertainty
over postgrad shake-up’, The Australian, 17 May 2017, p. 31.
[99]. Council
of Private Higher Education (COPHE), Submission
to the Senate Education and Employment Legislation Committee, Inquiry into
the Higher Education Support Legislation Amendment (A More Sustainable,
Responsive and Transparent Higher Education System) Bill 2017, June 2017;
Australian Council for Private Education and Training (ACPET), Submission
to the Senate Education and Employment Legislation Committee, Inquiry into
the Higher Education Support Legislation Amendment (A More Sustainable,
Responsive and Transparent Higher Education System) Bill 2017, June 2017.
[100]. National
Tertiary Education Union (NTEU), Federal
budget 2017: higher education swindle, media release, 9 May 2017.
[101]. NTEU,
University
budget cuts mean 10% less in real public investment per student and more job
uncertainty for staff, media release, 2 May 2017. See also
NTEU, Submission
to the Senate Education and Employment Legislation Committee, Inquiry into
the Higher Education Support Legislation Amendment (A More Sustainable,
Responsive and Transparent Higher Education System) Bill 2017, 7 June 2017.
[102]. S
Johnston (National President, National Union of Students) and A Stapleton
(National Women’s Officer, National Union of Students), ‘This budget
doesn't just hurt current students ...’, Facebook update, 17 May 2017, https://www.facebook.com/NationalUnionofStudentsAU/photos/a.133844243321056.12343.105203722851775/1379742832064518/?type=3&theater;
NUS, Submission
to the Senate Education and Employment Legislation Committee, Inquiry into
the Higher Education Support Legislation Amendment (A More Sustainable,
Responsive and Transparent Higher Education System) Bill 2017, June 2017.
[103]. Explanatory
Memorandum, Higher Education Support Legislation Amendment (A More
Sustainable, Responsive and Transparent Higher Education System) Bill 2017, p.
4.
[104]. Ibid.
[105]. Australian
Government, ‘Part
2: expense measures’, Budget measures: budget paper no. 2: 2017–18, p. 82.
[106]. Australian
Government, The
higher education reform package, op. cit., p. 23.
[107]. Australian
Government, ‘Part 2: expense measures’, op. cit., p. 84.
[108]. The
Statement of Compatibility with Human Rights can be found at page pp. 6–10 of
the Explanatory Memorandum to the Bill.
[109]. Parliamentary
Joint Committee on Human Rights (PJCHR), Report, 5, 2017, 14 June 2017, pp.
22–30.
[110]. International
Covenant on Economic, Social and Cultural Rights (done at New York, 16
December 1966, entry into force generally 3 January 1976, entry into force for
Australia 10 March 1976), [1976] ATS
5.
[111]. PJCHR,
op. cit., pp. 24–28.
[112]. International
Covenant on Civil and Political Rights (done at New York, 16 December 1966,
entry into force generally 23 March 1976, entry into force for Australia 13
November 1970), [1980] ATS
23.
[113]. PJCHR,
op. cit., pp. 26–27 and 28–30.
[114]. The
Committee's website indicates that it had sought a response from the Minister
by 30 June 2017. See: PJCHR, Correspondence
register, PJCHR website, table 1 (outstanding correspondence).
[115]. Deloitte
Access Economics, Cost
of delivery of higher education, op. cit., p. 40.
[116]. See
proposed sections 30-25(3)(c), 33-1(1)(b)(ii) and item 11.
[117]. Proposed
section 33-10.
[118]. Proposed
subsection 93-10(3). Note the census date must be after 1 January 2018 (per
item 18). The definition of enabling course is contained in item 13.
[119]. Australian
Government, The
higher education reform package, op. cit., p. 26.
[120]. Ibid.
[121]. Administration
Guidelines 2012.
[122]. Explanatory
Memorandum, op. cit., p. 25.
[123]. Ibid.
[124]. Ibid.
[125]. Ibid.
[126]. Commonwealth Grant
Scheme Guidelines 2012.
[127]. Income Tax
Assessment Act 1997.
[128]. Australian
Government, The
higher education reform package, op. cit., pp. 18–19.
[129]. For
more details see Australian Government, ‘VET
Student Loans’, StudyAssist website.
[130]. VET Student Loans
Act 2016.
[131]. See
Section 39 of the Trades
Support Loans Act 2014 and Section 1061ZVAA
of the Social
Security Act 1991.
[132]. Budget Savings
(Omnibus) Act 2016, Schedule 1.
[133]. Andrews,
op. cit., p. 4327.
[134]. D
Jacobs and A Rush, ‘Why
is wage growth so low?’, Bulletin: June quarter 2015, Reserve Bank
of Australia, June 2015, p. 12.
[135]. ABS,
Average weekly earnings, Australia, November 2016, cat. no. 6302.0, ABS, Canberra, 2017; and ABS, Consumer
price index, Australia, March 2017, cat. no.
6401.0, ABS, Canberra, 2017.
[136]. Other Grants
Guidelines (Education) 2012.
[137]. DET,
2010–2016
higher education participation and partnerships program (HEPPP) participation
allocations, DET, Canberra, 2016.
[138]. ACIL
Allen Consulting, Evaluation
of the HEPPP: higher education participation and partnerships program,
report prepared for DET, ACIL Allen Consulting, March 2017.
[139]. Australian
Government, The
higher education reform package, op. cit., pp. 22–3.
[140]. Ibid.
[141]. Ibid.,
p 22.
[142]. Norton
and Cherastidtham, op. cit., p. 44.
For copyright reasons some linked items are only available to members of Parliament.
© Commonwealth of Australia
Creative Commons
With the exception of the Commonwealth Coat of Arms, and to the extent that copyright subsists in a third party, this publication, its logo and front page design are licensed under a Creative Commons Attribution-NonCommercial-NoDerivs 3.0 Australia licence.
In essence, you are free to copy and communicate this work in its current form for all non-commercial purposes, as long as you attribute the work to the author and abide by the other licence terms. The work cannot be adapted or modified in any way. Content from this publication should be attributed in the following way: Author(s), Title of publication, Series Name and No, Publisher, Date.
To the extent that copyright subsists in third party quotes it remains with the original owner and permission may be required to reuse the material.
Inquiries regarding the licence and any use of the publication are welcome to webmanager@aph.gov.au.
Disclaimer: Bills Digests are prepared to support the work of the Australian Parliament. They are produced under time and resource constraints and aim to be available in time for debate in the Chambers. The views expressed in Bills Digests do not reflect an official position of the Australian Parliamentary Library, nor do they constitute professional legal opinion. Bills Digests reflect the relevant legislation as introduced and do not canvass subsequent amendments or developments. Other sources should be consulted to determine the official status of the Bill.
Any concerns or complaints should be directed to the Parliamentary Librarian. Parliamentary Library staff are available to discuss the contents of publications with Senators and Members and their staff. To access this service, clients may contact the author or the Library‘s Central Enquiry Point for referral.