The Universities Accord (Student Support and Other Measures) Bill 2024 amends the Higher Education Support Act to give effect to several measures from the Australian universities accord final report. These measures include changing the way HELP indexation is calculated to use the lower of either the consumer price index or the wage price index backdated to the 2023 and 2024 indexation years; the introduction of a Commonwealth prac payment for teaching, nursing, midwifery and social work students; FEE-FREE Uni Ready courses for students to undertake preparatory courses to prepare for university studies; and a requirement for universities to provide 40 per cent of the Student Services and Amenities Fee to student-led organisations. This bill also lists University of Adelaide as a table A provider, which will support the merger of the University of South Australia and the University of Adelaide.
While the coalition do support this bill, we are proposing several amendments, which I will discuss in due course. Fundamentally, we do raise very serious concerns about the way in which Labor has imposed such a massive impost on student debt for three million Australians. The education minister, Mr Clare, has talked a very big game on the support mechanisms for students but we do raise concerns about the deficient way in which this government is in fact supporting students in practice.
While escalating student debt is a direct consequence of Labor’s high inflation and economic mismanagement, the bill is proposing to change HELP indexation to the lower of WPI or CPI. It’s very important not to gloss over what has happened and what Labor is trying to do. Under Labor, HELP indexation has risen by almost 16 per cent: 3.9 per cent on 1 June 2022, 7.1 per cent on 1 June 2023 and 4.7 per cent on 1 June 2024. For someone with an average loan of $24,700 as at June 2022 this has meant a crippling increase of around $4,000. It’s very important to contrast that with the average annual indexation of just 1.7 per cent, which occurred under the former coalition government.
This government can attempt to rewrite history, but three million Australians will never forget what has happened to them under this government. Student debt is out of control. And let’s not forget that there are many young Australians who are struggling just to pay the rent or put food on the table. So while this bill changes how HELP indexation is recalculated and backdates that indexation formula, let’s not forget that this still means an increase in student debt of 11.1 per cent. In the face of Labor’s cost-of-living crisis, this is still a kick in the guts for struggling students and the three million Australians with a student loan. The other really important point to make to counter Labor’s false narrative about delivering refunds of some $3 billion is that most students will not see a refund, as Labor is trying to suggest, and that, of course, provides no cost-of-living relief. That is because, for most students, there will be a rebate applied against each person’s HELP loan account, which of course will be eroded over time by reason of future indexation, depending on how long it ultimately takes to pay off the debt. So, of the three million Australians, it’s estimated to be only about 200,000 who will actually receive a refund, and that refund will be contingent on any other Commonwealth debts which are owing being cleared before cash will be back in the bank. Of course, the fact that the government is talking about refunds and cash in the bank is also ridiculous, because we don’t know when this is going to occur. We have for many months sought details about when this rebate, refund or reduction will be applied, and we are none the wiser.
What we do know is that the claims that the government are making that they will wipe $3 billion in student debt are very misleading. Under Labor, indexation has gone up by a staggering $8.1 billion. So this is all smoke and mirrors from this government to try and cover-up the absolute mess it has made of HELP debt because of the fact that Labor has mismanaged the economy. It has kept inflation higher for longer, and that’s had a very detrimental impact on all Australians, including, of course, Australians with a HELP debt.
Recognising the mess that the Albanese government has made of student debt in this country since the election, the government has also announced several other student debt policies: lifting the HELP debt repayment threshold and lowering the minimum repayment to $450 a year. As we’ve made very clear, this could lead to a lifetime of debt, and we’ve raised serious concerns about that.
The government has also made an election commitment of a discount of 20 per cent to student debt for all debtors, which is a policy reeking of unfairness and elitism, because, as we know, the people who are going to get the most out of that policy are just 55,000 people who have a HELP debt of between $100,000 and $200,000, meaning that, under this policy, Labor would effectively deliver them an average pay cheque of $25,000. Three million people may receive this discount. First of all, Labor’s not serious about this policy; otherwise it would have brought this legislation forward in this parliament. So this is nothing more than an election bribe. But what does it say to all those millions of hardworking Australians who’ve paid off their HELP debt? What does the fact that this is going to cost $16 billion in the hit to the bottom line, or $1,600 for every household, say to all the Australians who’ve seen a collapse in living standards and in their disposable incomes under Labor? I remind the chamber of what the leading economist Chris Richardson said:
… handing $16bn to graduates is a reverse Robin Hood: it’s a tax cut targeted to the big end of town, with money going from the less well off to the better off.
So this is grossly unfair. This is reeking of elitism, and this just sums up what this government is all about.
I will just make the point that Labor has imposed the most horrific cost-of-living impost on all Australians, driving up the cost of food by 12 per cent, health costs by 10 per cent, education costs by 12 per cent, electricity costs by a staggering 31 per cent, gas costs by a staggering 34 per cent, housing costs by 13 per cent and rents by 16 per cent. This government is just tinkering at the edges and doing nothing more.
The bill, as I mentioned, also makes provision for Commonwealth prac payments for students studying teaching, nursing, midwifery or social work. They, of course, work enormously hard, but there is enormous uncertainty about this payment. The universities have in fact raised serious concerns about this. It will be delivered not via Centrelink but through a grant bucket, and then the universities will need to seek payments from that grant bucket. There has been very little or no consultation with state and territory governments or the industry as to how this measure will be implemented, and we are deeply concerned about the lack of consultation.
We learnt during the committee hearing in the Senate hearing process that there’s no detail as to which students will be eligible, how they will be means tested or how and when they will receive this prac payment. As a result of the enormous uncertainty, the coalition will pursue a substantive amendment requiring the government to table the eligibility and means-test requirements for the Commonwealth prac payment before the new grant payment can commence. Importantly this will provide transparency ahead of the payment commencing to ensure students and the providers who will be accessing student applications understand the requirements before the payment begins. Without clear eligibility guidelines, students remain in the dark about this payment.
The bill also includes provisions in relation to the delivery of fee-free university courses. We have raised a number of concerns in relation to that because, at the moment, under the enabling places, which already exist, students can study right now and at no cost. While providers will receive a higher base funding rate per place, being some $18,278, the loss of enabling funding will mean an overall reduction in funding for students who need additional support. There have been some concerns raised about the way that the government has changed the availability of enabling courses, which were very much directed to particular courses and offered to students to support them to kickstart their university studies.
We are also particularly concerned about the requirement in this bill that a minimum of 40 per cent of the student services and amenities fee revenue be directed to student led organisations, including student associations, unions and guilds. This is concerning, and, for that reason, we will be introducing an amendment which seeks to remove the 40 per cent allocation requirement to allow universities the flexibility to distribute these funds in ways that best meet the needs of all students, rather than prioritising student led unions.
The universities have also raised concerns about this. There are some transition provisions in this bill, but we don’t think that they’re strong enough. This is also a measure, directing this additional money to support student led organisations, which is driven more by ideology than by common sense because a lot of smaller universities don’t have well-established student led organisations which can deliver the sorts of support that students need, and that support is really, really important. That support is critical to give students the support they need, whether it’s legal advice, health advice or mental health advice and support. As I say, we are concerned that this provision is all about supporting student unions to run their activities. In particular, if the amendment fails to separate out and vote against this allocation, we are proposing to safeguard these funds from being used for student elections, student protests or protest related activities to ensure these resources directly benefit student welfare and essential services. We have heard anecdotally of a number of instances when student led organisations have used moneys held by them for what I regard as improper purposes. It’s very, very important that we have this safeguard. Otherwise this is a mandate that’s ideologically driven and overlooks critical concerns raised by universities about the misuse of funds. We are seeking the support of the Senate for that amendment to make sure that student support funds are used properly to support students and not for other improper activities, such as student protests and the like. I move:
At the end of the motion, add “, but the Senate notes that:
(a) the Albanese Government’s economic mismanagement and high inflation has resulted in escalating student debt for some 3 million Australians with a HELP (Higher Education Loan Program) loan,
(b) the proposal to change HELP indexation to the lower of the wage price index or the consumer price index would still result in student debts increasing by 11.1 per cent since June 2022, with no date by which student debt credits will be applied or refunds paid,
(c) whether it is student debt, housing or paying bills, Australians continue to suffer acute cost-of-living pain under this government,
(d) the Government has failed to detail eligibility criteria for the Commonwealth Prac Payments or how students will receive those payments, noting that students studying in other areas of workforce shortage such as occupational therapy, psychology and veterinary studies have been excluded from the scheme; and
(e) the Government’s decision to mandate 40% of the Student Services and Amenities Fee revenue be directed to student led organisations, including student unions, associations and guilds, lacks any transparency measures to ensure money is spent on services which support student welfare”.