Bills - Higher Education and Research Reform Bill 2014









This week students at universities right the country will be attending O-week, and they will be doing so at a time when our higher education system is under a vicious assault from the tea party conservatives who sit on the other side of the House. This assault of course takes its form in the Higher Education and Research Reform Bill 2014. This bill is the second attempt by the Prime Minister and the Minister for Education to wind back the clock to the 1950s, when our universities were reserved for the wealthy elites of our society. As far as they are concerned, they cannot get there quickly enough. Late last year we saw the crossbenchers join the Labor Party to do the right thing by students and future generations in rejecting the first incarnation of this bill. Today I call upon all of those crossbenchers to do that once again—to stand with Labor for fairness in education, for investment in the future and for a society which is marked by high levels of wealth creation and high levels of social mobility.

The conservatives opposite love to trumpet the American system. They think the American system of tertiary education is the way to go. Indeed, they also trumpet the American system of health care. When it comes to education, they say the US system is the gold standard—look at Harvard, look at Yale, look at Princeton. Well, rather than cherry picking one or two—which are not correct comparisons anyway—let's just have a look at the American system of education.

According to the OECD in its latest assessment of education levels across developed nations, the United States as recently as 1996 had the second highest share of adults who earned post-secondary education credentials and the highest share of adults with university degrees. This is no longer the case. In the space of less than 20 years America's level of educational achievement has fallen behind other nations to the point where in 2012, the most recent year measured, the United States was ranked fifth in the percentage of adults who had earned a higher education award.

As the inclusive prosperity report recently published by the Centre for American Progress shows, not only has the proportion of Americans receiving a higher education fallen; but there is a pronounced downward trend in educational mobility in that country. In America 29 per cent of men and 17 per cent of women had less education than their parents compared with the OECD average of 19 per cent for men and 13 per cent for women. Only 20 per cent of US men and 27 per cent of US women had more education than their parents compared with the OECD average of 28 per cent and 36 per cent, respectively, falling well behind the OECD average, but this is the system which is deified by this Minister for Education and Training because it goes to the very heart of their survival-of-the-fittest mentality. Let the market rule anywhere; that is the only measure they have. But what these figures show is that those sorts of approaches produce lower social mobility and at the end of the day lower economic growth and a less mature, informed and prosperous economy and society.

This downward trend in educational mobility is likely not only to impact on long-term productivity growth because that relies on the accumulation of knowledge but has a much more profound effect on the society itself because truly optimistic societies are those societies where there is a high degree of social mobility, where people understand that, if they work hard, study hard and get a good qualification, they can achieve an outcome from doing that. Lower social mobility leads to a much more pessimistic society and less social harmony.

Recent studies in America have shown that for every one per cent increase in the share of a state or region's population who successfully complete a higher education course there is a corresponding wage increase of 1.6 per cent for all high school graduates. What that figure shows is simply this—and in many ways it is common sense, but it is very good economics and it is even better social policy—when you invest in higher education, you do not just lift a few boats; you lift all of the boats and you drive economic growth through education.

No country can afford to turn its back on the wealth-boosting and -creating potential of higher education, but that is exactly what our country is doing, exactly what this government is doing precisely at the wrong time when we are so poised to reap huge benefits which will flow to this country from the Asian century. The most concerning aspect of the conservatives' fascination with the American higher education system is simply its callous disregard for future generations, who are going to be saddled with overwhelming levels of debt—quite ironic as you sit in this parliament and are lectured by those opposite about levels of debt. They have no compunction about going down the American road of huge levels of debt for students. In the United States student debt is $1.2 trillion, there are default rates of 40 per cent and there is certainly a growing concern in that country that student debt is not just a drag on economic growth but a drag on future consumption from families and also a cause in the future of financial instability within their economic system itself.

This is the system that the conservatives in this country want to impose on future generations in this country: greater inequity and greater debt. That is why I call it a form of class and intergenerational warfare—nothing more, nothing less, particularly when it is combined with the proposal to have time limited unemployment benefits—and then some—and the attack on universal health care. There is no financial responsibility more important to social mobility peace of mind than the combination of knowing that when you have a family your children can get access to education and be safe in the knowledge that, if some trauma happens in the family, affordable health care is available. That too is being withdrawn from future generations, and those three attacks—unemployment benefits, what is going on in higher education, what is going on in health care—are intergenerational and class warfare in our system from the conservative, survival-of-the-fittest mentality mob who run this country at the moment.

One of the reasons they are in so much political strife is that they are trying to impose this model on a group of people who have the common sense to see it for what it is. They want to import a model where there is a real-time measurement of the crisis it causes in an economy and transpose it on ours in spite of all the evidence that exists about what is going on in the United States. It is a system in crisis.

If we look at the Australian system since 2000, we see Australia has significantly boosted our share of the population which has earned post-secondary education credentials and degrees. In 2000 just 27 per cent of Australian adults had earned post-secondary education credentials. By 2012, the most recent year for which data is available, the share of adults in Australia with post-secondary education credentials had increased to 41 per cent. Twenty-seven per cent to 41 per cent. Among Australian young adults aged 25 to 34, 47 per cent had earned post-secondary education credentials, up from 31 per cent in 2000. Overall, at 77 per cent, Australia is first amongst all OECD and partner countries in the share of young adults who are expected to pursue university degrees before turning 25 years old. We are punching well above our weight—because Labor governments from Whitlam all the way through have been active partners in funding the higher education initiatives which the coalition is now determined to tear down.

What is most perplexing about the coalition's plan for higher education is highlighted in the inclusive prosperity report which I spoke about before. It notes that in order to fix the American higher education system a bold new approach is required. It says that America should make community college or a public four-year college virtually free at the time of study so that all high school graduates and their families have no doubt that they can afford higher education. Sound familiar? The report goes on to conclude:

Under such a system, students would be required to repay all or part of the support they received as a percentage of their income over a specified period of time—for example, 20 years or 25 years. If former students are struggling economically, no payment would be required until their earnings are sufficient to make payments.

That is the Australian system that we have now, before its destruction as proposed by those opposite. The Australian system has an emphasis on affordable education. It encourages, not discourages, wide participation. Now in Australia now have a government which wants to move Australia to a high-cost American system while the Americans want to move to an Australian system because the financing of their higher education system in that country has been such a comprehensive failure. No-one in this House should be surprised at this because this agenda has lurked on the conservative side of politics for years, but it popped out after the last election when we suddenly saw their real Tea Party credentials—and of course it was exposed in full on budget night 2013. These are just some of the reasons we oppose this bill so strongly.

We have got to be clear about what the coalition is trying to do. Cuts have been run through—with $2 billion in grants alone. The product of that is $100,000 degrees. This is going to discourage participation by those people who cannot afford to take on this level of debt and who, in all likelihood, will be receiving only modest incomes in a whole range of professions and who will therefore decide in the future—or their children will decide—that it is simply not worth getting a degree when the debt that comes with it cannot by paid off with the modest income that they are likely to earn in the future. That is why this system is so tragic. That is why it will lead to intergenerational inequality: it will simply push out of the system those whom we spent years and years getting into the system in the first place. It is going to be particularly hard on professions such as nursing and education but it is also going to hit engineering hard. Those figures have been canvassed pretty thoroughly in this debate. What we do know, and what those on the other side of the House are in denial about, is that the cost of the degrees will impose a crippling debt that will discourage active participation. At the end of the day we are all going to be the losers. Individuals will be the losers and our economy will be the loser as well.

This debate is pretty revealing of the government's priorities overall. They do not see any form of collective solution to any particular form of social policy as being the way to go. They have got an individualist view of the world where governments should play a minimal role, if any role at all. In their view, the actions of a whole host of individuals will produce something that is greater than the sum of its parts. This defies experience around the world.

One of the reasons Australia has been so good, over 100 years, at matching strong economic growth with social equity is that we have always had a really good partnership in our economy between government on the one hand and business and community on the other. And we have worked together with the models we put together in education, with universal public provision so that people can pay more to buy up. In health, people can get a good basic service but pay more and trade up. This has all been done on the basis of government working cooperatively and intervening where necessary in the community. We have had a decent system of industrial relations with a decent level of minimum wage and collective bargaining rights, universal health and education, a progressive tax system and transfer payment system—the basis of the Australian model. And surely, bit by bit, plank by plank, this government has identified every one of those key public policies that go to the core of the fact that Australia is not only prosperous but fair. What they do not understand is: it is bad economics when you start attacking the platforms in the economy that drive social mobility and fairness. What that drives is a low value, unfair economy which does not grow.