AUSTRALIAN GREENS' DISSENTING REPORT
The Australian Greens supported the referral of the Higher Education and
Research Reform Amendment Bill 2014 to the Senate Education and Employment
Legislation Committee because we were concerned that the bill would have such a
destructive impact on higher education and research in Australia.
Strong investment in higher education will lead to substantial public
benefits for Australia’s economy and society, including the development of new
industries and job creation.
The only barriers to a system of free higher education that is well
funded and prioritises quality education and research are political, not
technical. The Commonwealth could choose to raise revenue or re-prioritise
spending in order to boost funding to public higher education.
The Australian Greens have a long-term commitment to high quality,
well-funded public higher education that is accessible to all students
regardless of their background.
The Coalition Government announced its intention to slash nearly $5
billion in funding to higher education in the 2014 Federal Budget, lift the cap
on student fees and charge higher interest rates on student debt despite
campaigning in the lead up to the 2013 Federal Election on a platform of 'no
changes to university funding arrangements'.
These proposed cuts have been opposed by a vigorous and successful
student and staff campaign that has mobilized tens of thousands of members of
Australia is already one of the lowest public funders of higher
education in the OECD and the cuts proposed in the bill would take us
substantially further backwards.
Substantive elements of the bill
The bill contains a wide range of interlocking measures that when taken
together will create an unfair, inequitable and elitist higher education system
in Australia. Separate provisions of the bill are dealt with individually
Deregulation of student fees
The majority report states:
As public funding for higher education has stagnated or
fallen through successive governments, international rankings of Australia's top
universities have remained static or fallen, especially relative to regional
The lack of guaranteed, high levels of funding has been used as the
primary justification by the university sector for supporting fee deregulation.
Numerous vice chancellors stated that their support for fee deregulation was
driven by the fact that successive federal governments had inadequately funded
higher education and the 2014 Federal Budget stripped nearly $5 billion from
However, it has been disappointing to see vice chancellors, particularly
those from the Group of Eight, not fight strongly against the government’s
proposed cuts, but instead use them as an opportunity to give themselves
greater flexibility in the form of fee deregulation.
Rather than being driven by any genuine “competitive agenda” it is clear
that fee deregulation is being pushed by the government has a tool by which to
shift the cost burden of higher education onto students.
By cutting student subsidies by an average of 20 per cent per place the government
is essentially forcing all universities to raise their fees in order to retain
their current level of funding.
Analysis by the National Tertiary Education Union has found that $100
000 degrees could become a real possibility under fee deregulation:
Analysis undertaken by the NTEU found that the cost of
attaining a university degree in Australia will rise substantially as a result
of these changes and there will be cases where the cost of a degree at some
Australian universities will exceed $100,000. The NTEU’s latest analysis shows
that the cost of attaining a five year medical degree, for example, would rise
from about $50,000 at present, to well over $90,000 as a direct result of
government cuts to funding per student and the imposition of interest rates on
student debt. The analysis shows that universities would only need to increase
fees by as little as 10% above that necessary to compensate for cuts to funding
for there to be $100,000 degrees.
Fears of prohibitively expensive degrees were raised by other witnesses
as well, such as the ACTU, National Union of Students and the independent
National Centre for Social and Economic Modelling, based at the University of
The new fee structure announced by the University of Western Australia,
which will see students pay $16 000 a year, will very quickly see five year
degrees costing in the range of $100 000 once interest on student debt is
Not a single witness agreed with the Minister’s proposition that
university fees would go down as a result of deregulation. Given that
university vice-chancellors are viewing fee deregulation as a tool to boost
revenue, it is obvious that fees will increase across the board if this bill is
passed by Parliament.
Commonwealth Scholarship Scheme
The very name of the proposed scheme is highly misleading as no
Commonwealth funding will be provided.
Further, the government has already confirmed that money will only begin
to flow into the scheme once universities increase their fees more than 20 per
cent in order to make up for the cut in student subsidies.
As the NTEU argue in their submission:
There are inherent inequities built into the design of the
program given that the average value of scholarships offered by universities
with the largest numbers of disadvantaged (low SES) students will be lower and,
in many cases, not even sufficient to offset the increase in fees.
The National Union of Students also criticises the operation of the
scheme and the lack of any guidelines prior to the release of the bill.
According to the private education sector, only 10 per cent of private
providers have over 500 students and therefore would be part of the proposed scholarship
New indexation for all HELP debt
The proposed application of real interest rates to HELP debt has been
criticised as the most unfair and regressive element of the bill.
As Professor Chapman argued in 1996:
The lack of a real rate of interest on the debt is also worth
highlighting. It means that those former students who earn relatively low
incomes over their lifetimes are given greater subsidies in the form of
implicit access to an interest free loan. The orders of magnitude of this
subsidy can be quite large. For example, [it was] demonstrated that male
lawyers, because they earn high incomes relatively quickly after graduating, in
effect pay up to 30 to 50 per cent more (in present value terms) than do public
sector teachers who spend five years out of the labour force after graduating.
The Australian Nursing and Midwifery Federation pointed out the sexist
nature of the proposed changes:
The other issue of course with these proposed changes to the
higher education scheme is that nursing is a female dominated profession; 92
per cent of nurses are female. When you take into account the part-time nature
of women's work and also, often, the time that women take off to have children
or to manage family responsibilities, it would be no surprise to you that we do
not support these proposed changes because of the impacts that they potentially
have on nursing and on the ability of the general public to be able to sign up
for university courses that lead to registered nurse qualifications.
The Australian Education Union also supported the notion that these
changes would have an unfair impact on women and low-income earners.
The fact that the majority committee report calls on the government to
reconsider its position on charging a real interest rate on student debt
highlights the immense weight of the evidence heard in the inquiry regarding
the unfair and regressive nature of the proposal.
Research Training Scheme
The proposal to charge research students was criticised by a wide range
of witnesses as noted in the majority report.
Innovative Research Universities alleged that the amendments ignored the
contribution of researchers or research teams:
The amendments treat research students solely as students
consuming resources for a potential payoff following graduation....A thorough
rethink of the place of research students is required to address the mechanisms
by which Government supports their development and their living costs. This
should ensure coherence with undergraduate funding where universities are funded
for all students who enrol. The Government should be encouraging additional
research students not discouraging enrolments.
The Council of Deans and Directors of Graduate Research submitted that
the proposed amendments will negatively impact on the quantity and quality of
Australia's research graduates and decimate Australia's research workforce.
The driver for charging fees is in part to meet shortfalls in
the research training scheme (RTS) as a result of the proposed budget cuts. The
need for a highly trained research workforce across industry, business,
government and the academy is clear and higher education institutions have been
working towards enhancing programs to produce better qualified graduates more
prepared for roles across multiple sectors. Cutting the RTS is counter-
productive and will place additional financial pressure on institutions and
will stifle their ongoing efforts to enhance the quality of research training
by focussing on and providing broader skills development in the HDR graduates.
The Council of Australian Postgraduate Associations strongly criticised
the $174.7 million cut to the Research Training Scheme and the proposal to
charge research students a fee for their degree.
Extending Commonwealth funding to
The committee heard strong evidence from the Australian Education Union
regarding the problems associated with allowing private providers to access
public funding for higher education:
These matters are of real concern for us. A government that
is intent on deregulating and applying market principles is not too interested
in enforceability of many things at all. Who is going to hold these operators
to account—including the dodgy operators in the VET sector—who have not been
held to account thus far?
The rapid demise of the public TAFE system, particularly in
Victoria, but also across the country—the damage that has been done to the TAFE
system as a result of an incredibly rapid opening up of the market—has been
quite well documented. It has been accompanied by a huge growth in both the
number of private providers—now in excess of 5,000 across the country—and the
amount of public funding that has now gone to the private sector. So in a
relatively short period of time the market has opened up.
The damage to TAFE is best documented in Victoria but
certainly is not restricted to Victoria. In Victoria the vast majority of TAFE
colleges, according to the Victorian Auditor-General, are now struggling
financially. TAFE market share in Victoria has dropped from about 75 per cent
in 2008 to around 27 per cent in 2014. In fact, some commentators think it has
dropped below that, if you take into account some practices around
subcontracting of delivery, because the TAFEs themselves can no longer—on the
basis of the public subsidy they are getting—afford to deliver the
That shift in the market has been equally significant in
South Australia. South Australia was one of the first states to act upon the
requirements in the 2012 national agreement and open up their market. There
again, you see public TAFE provision where the share of the market has dropped
below 50 per cent. It is really occurring around the country.
What is troubling, particularly in terms of the experience
that the TAFE and VET sector brings to this bill, is the opening up of the
market. It has been accompanied by some of the most appalling practices by
private providers who, because of the inadequacy of the regulatory system and
the rapidity with which the market has opened up, have been engaged in what
could only be seen as deplorable practices. They exploit students through the
delivery of lower-level qualifications, as these providers have accessed more
and more public funds, and cherry pick delivery. Where they deliver anything—a
lot of them have been delivering very little—they focus on the high-turnover
end of the market.
They have also been exploiting the opening up of VET FEE-HELP
in the sector. In this sector, as a result of the 2012 national agreement, VET
FEE-HELP was introduced in earnest. In 2008 around $25 million was allocated to
VET FEE-HELP. By 2014, by midway this year, more than $700 million so far has
been allocated to VET FEE-HELP. The vast majority of that, around 75 per cent,
has gone to the private sector.
The result of this has been a significant series of question
marks around the quality of provision in the private sector. There has also
been a whole series of questions around the cost of qualifications. Far from
the opening up of the market in VET leading to a downward pressure on price, we
now see the spectre of $30,000 being charged for diplomas and advanced diplomas
in VET. In fact, a degree at a public university would cost less. That cost is
being shifted, at least temporarily, through the Commonwealth, onto students.
The market has not acted, in the sector, either to increase
quality or in any way to represent value for money for individual students. It
represents a real threat to the quality and reputation of qualifications in the
sector. It really opens up the whole question of the exploitation of young
people who are embarking on a future with their qualifications.
When this bill is looked at holistically, what becomes clear is that
what the government is actually proposing is to make savings in the public
higher education sector and raise revenue off students by increasing student
fees while simultaneously delivering a $500 million windfall to private
Nothing in this bill would force private providers to reduce their fees
as a result of receiving government support. In fact, evidence in the VET
marketplace shows that, over time, private providers are likely to charge more than
their public equivalents and simply pocket government support in the form of
While the government continues to claim the higher education sector is
supportive of the bill, the evidence heard by the committee contradicts this.
The higher education sector is a much broader and more diverse group than
simply university executives. Students, staff and independent experts have
presented strong and well researched submissions arguing about the inherent
inequity in the bill.
Despite the government attempting to present the bill as some kind of
genuine attempt to improve accessibility in the higher education sector, it is
clear the primary motivation is to achieve budget savings in the order of $5
If the government was so certain that the changes proposed in the bill are
sound policies that are supported by the sector and the community, they would
have taken these policies to the last federal election.
The debate around funding higher education in Australia does not need to
be about what level of funding cuts are “fair”. There is no reason, other than
the dogmatic application of economic rationalism, as to why federal governments
can’t increase university funding across the board.
This bill fundamentally misrepresents the value Australians place on
If this bill is passed it will create an inequitable and elitist higher
education system which limits access to our highest quality public education
The Australian Greens recommend that the bill not be passed.
The Australian Greens recommend that the Senate Education and Employment
References Committee establish an inquiry to investigate the benefits of base
funding increases to universities and the abolishment of student fees.
Senator Lee Rhiannon
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