BILLS;Higher Education Support Amendment (Streamlining and Other Measures) Bill 2012;Second Reading – 21 Nov 2012

I also rise to speak on the Higher Education Support Amendment (Streamlining and Other Measures) Bill 2012. Higher education is the means by which millions of Australians improve their opportunities. By training for a qualification they gain the means to engage in the labour market and to be active and productive to the fullest extent. The broader economy also gains extra capacity to grow in an increasingly competitive global economy, bringing benefits to the whole community.

I would like to remind the Senate of the comments made earlier this year by the Minister for Tertiary Education, Skills, Science and Research, Senator Chris Evans:

Skills determine access to jobs and can transform lives. Too many Australians are locked out of the workforce because they do not have the skills they need. Inaction is not an option. Failure to address this shortfall will leave the economy short of the skills it needs to be successful well into the 21st century.

I could not agree more. Skills Australia has estimated that, in the five years to 2015, Australia will need an additional 2.1 million people in the workforce with higher vocational education and training, or VET, qualifications. Currently it is expected that there will be a shortfall of 500,000 skilled workers. This is particularly relevant for my home state of Tasmania, with Skills Australia research showing that, from now to 2015, Tasmania will need an additional 11,000 people with qualifications at certificate III/IV level and an additional 8,000 people with qualifications at diploma level. The government understands the importance of ensuring that this need is met and that the higher education system is configured correctly to best meet the needs of Australian students, the higher education sector, and the broader Australian economy.

The issue of higher education is one of particular relevance to Tasmania. Like Australia more broadly, Tasmania faces issues of demography and of a changing global market. With an ageing population, Tasmania faces the issue of a consequently lower workforce participation rate for the foreseeable future. Competition between skilled workers is high, and a lack of skilled workers leads to slower growth and lower productivity. Combined with this, there is anecdotal evidence of a reduction in the number of apprenticeships and traineeships being supported by industry. With slowing demand for Tasmanian products, it is vital that we support individuals to adapt to changing employment opportunities through their working life, as well as supporting individuals to develop new markets. Tasmania must work smarter rather than harder, and an increase in VET education will help to allow Tasmanians to do that.

This bill will introduce a number of measures that will strengthen and streamline the Higher Education Support Act 2003, resulting in more effective and efficient administration of two of the Australian government’s Higher Education Loan Program schemes, namely FEE-HELP and VET FEE-HELP. The VET FEE-HELP assistance scheme was introduced in 2008 and provides income contingent loans to full-fee-paying and certain subsidised students undertaking eligible VET diplomas, advanced diplomas, graduate certificates and graduate diplomas.

The introduction of the VET FEE-HELP scheme made it easier for students to access higher education, and the increased participation numbers since the introduction of the scheme are testimony to that. The information collected on the VET FEE-HELP assistance scheme and the feedback received as part of the post implementation review of the scheme indicates that there are positive achievements to date and positive signs for continuing growth into the future. These achievements include increasing trends in student enrolments, the number of approved VET FEE-HELP providers, the number of eligible VET courses, participation by students from identified demographic groups and funding to the VET sector.

The review made recommendations to improve the scheme, and this bill will position the government to act on the recommendations arising from the review and its commitments under the April 2012 COAG National Partnership Agreement on Skills Reform, particularly the redesign of VET FEE-HELP. The bill enhances the quality and accountability framework underpinning the schemes through strengthening the suspension and revocation provisions. Decisions to revoke or suspend an approved provider will now take effect on the day the notice is registered on the Federal Register of Legislative Instruments. The amendments will ensure that notices of revocation will take effect in a more timely manner and will also give the provider greater clarity about the date the revocation will take effect.

The integrity and transparency of the HELP schemes will also be improved by allowing reports from the national and non-referring jurisdiction education regulators to be considered for both applicants and approved providers. This is expected to result in improved decision making and, in particular, will enhance the capacity to identify low-quality providers. The bill will provide a risk management approach to approvals and compliance for low-risk VET FEE-HELP providers through amendments that allow the minister to determine a category of providers when approving an application. The review noted:

Student access to VFH loans is largely dependent on the number of RTOs that become approved VFH providers (and the courses that they offer). There is considerable room to encourage greater participation by the VET sector beyond the current 95 approved VFH providers.

It is expected that by taking this approach, the administrative burden placed on low-risk applicants and providers will be reduced and this will encourage increased uptake by quality VET providers and ultimately students.

The bill also provides for the consolidation of the following existing four guidelines. They are: VET Provider Guidelines, VET FEE-HELP Guidelines, VET Tuition Fee Guidelines; and VET Administration Guidelines. The consolidated guidelines will simply be called the VET Guidelines. These guidelines are expected to reduce duplication of requirements and improve the accessibility, clarity and transparency of the obligations of approved providers. We know that technology and the needs of employers often change rapidly, so VET providers need flexibility when creating courses.

The bill also makes changes regarding the census date for courses. The census date for courses determines the point at which students are deemed to be enrolled in the course for the purposes of FEE-HELP or VET FEE-HELP. The current provisions are based on the higher education arrangements, whereby the census date is deemed to be not less than 20 per cent of the way through the unit. This is to allow students to withdraw from courses early in their study without incurring a HELP debt. However the PIR noted that, given the flexible nature of VET courses, the 20 per cent rule meant that providers may have multiple census dates resulting in a considerable administrative burden. The inclusion of the census date provisions in the legislation also limits flexibility. This bill removes the current 20 per cent restriction and provides for a census date for each unit of study to be determined in accordance with the Administration Guidelines under FEE-HELP and in accordance with the VET Guidelines under VET FEE-HELP.

The bill will also strengthen a number of definitions and other technical amendments to better support VET FEE-HELP. The definition of a VET course of study will be amended in order to provide for a managed trial of certificate IV qualifications as committed under the 2012 COAG National Partnership Agreement on Skills Reform. Lastly, further streamlining of administration to reduce duplication and increase efficiency will be achieved through the consolidation of three sets of legislative guidelines into a single set of guidelines.

The Senate referred the bill to the Senate Education, Employment and Workplace Relations Legislation Committee, of which I am a member. The committee heard evidence from a number of organisations, including the Tasmanian Department of Education, the National Tertiary Education Union, RMIT University, and TAFE Directors Australia recommending that the bill be passed.

I would like to quote from the Tasmanian Department of Education, which in its evidence to the committee said:

Tasmania is supportive of measures to improve the accessibility of higher level qualifications. We would support measures that would streamline and simplify student access to VET FEE-HELP. In particular, we would support measures that would enable legislation to allow specified Certificate IV level qualifications to be eligible under VET FEE-HELP.

Benefits of introducing VET FEE-HELP in Tasmania for Diploma, Advanced Diploma and specified Certificate IV level qualifications will include allowing us to prioritise government subsidies to the areas of greatest needs such as foundation skills and pathway qualifications in Tasmania’s priority industries and occupations.

The changes made in this bill will give students greater choice, and greater access. It will streamline processes for higher education service providers, making the delivery of higher education more cost efficient. By simplifying the administrative aspects of the VET FEE-HELP scheme, we will also see a further increase in the number of training organisations that will offer courses under the scheme. It will help drive the training that we require to meet our current skill shortages and meet our future skill needs.

Future prosperity is dependent upon increases in productivity. Increasing the skills possessed by Australian workers will help drive increases to productivity and, consequently, an increase in the standard of living for all Australians. Increasing the skills possessed by Australian workers will broaden the opportunities available to those workers and help them to participate in the economy to the fullest extent. I commend the bill to the Senate.