BILLS;VET Student Loans (Consequential Amendments and Transitional Provisions) Bill 2016;Second Reading – 30 Nov 2016

I spoke earlier about this bill and I was interrupted. I was explaining to those on the government benches who were previously opposed to a price cap on VET fees. Minister Ryan, Birmingham and Morrison all came out strongly against the idea. Despite all the criticism from those opposite of Labor’s price cap policy, these bills we are debating today propose three different price caps on VET FEE-HELP lines: $5,000, $10,000 and $15,000. This is a backflip of such proportions that, seriously, it would make an Olympic gymnast proud.

Another welcome backflip by the government has been the provision of an ombudsman for the VET sector, something that Labor has been calling for over a long time. The Minister for Education and Training, Senator Birmingham, gave an undertaking a year ago that he would establish an ombudsman, but there was no provision for one in these bills when they were presented to the House. Many stakeholders supported the idea of an ombudsman through their responses to the VET FEE-HELP discussion paper, and it is pleasing to see that the government will finally move to amend their legislation in this place to provide for one. An ombudsman is a sensible, practical step to help students get redress for exploitation and unfair debts.

Labor is also pleased to see the government moving to implement a version of the transparency and reporting requirements that Labor moved in the House. This will allow information about the operation of the scheme to be released twice a year so that the public can scrutinise the effectiveness of what providers are doing and what is happening to taxpayers’ money.

Labor has serious concerns about the government’s draft eligible course list which were raised by stakeholders through the Senate inquiry. Submissions to the inquiry noted the simplistic methodology used to create the list. The government has based the list on state skills lists, which were never ever designed for this purpose. The requirement that the course be on two state lists has ruled ineligible many specialist courses that are only offered in one state. And there has been particular criticism from the arts and creative industries, as courses offered by some of our most respected public arts institutions, such as NIDA and the Australian Ballet School, have also been deemed ineligible. I would have thought that the government was actually trying to make some amends in the area of the arts following their disastrous cuts in regard to the arts funding area. There have been courses struck off the list that had been developed to meet industry need which have very high employment outcomes. While we are not voting on the course list today, I understand that my colleague in the House Kate Ellis has written to the minister, urging him to consult with industry on the eligible course list and address the concerns that have been raised.

Labor will be moving two amendments to these bills to address issues that were raised by the Senate inquiry. One of our amendments will allow the minister to grandfather VET FEE-HELP students beyond the end of 2017. The current provisions have the grandfathering abruptly ending at the end of 2017. There are a number of reasons why students may need to continue their study beyond the end of 2017. They might be studying in a course that goes for more than 12 months, they may be studying part-time or they may have suspended their studies taking time off because of illness or family responsibilities. There are currently 140,000 students, by the government’s own estimate, who will need to be grandfathered so that they can finish their courses. The alternative for these students will be having to pay the full cost of their course up-front if they want to finish. Under our amendment, the grandfathering power is given to the minister so the extension does not provide an excuse for dodgy providers design on more students and charge inflated fees.

Labor’s other amendment would exempt TAFEs from the proposed course restrictions and loan caps for another year until 2018, and this will allow the government time to strike a new funding deal with the states. The VET FEE-HELP problem applies overwhelmingly to the private sector. The following facts clearly demonstrate this. TAFEs have a much higher unit completion, on average 77 per cent compared to 59 per cent for private providers. TAFEs do not charge inflated fees for courses. The tuition fees for the most popular diplomas in 2015 are less than $6,000 at TAFE compared to over $18,000 with private providers. We know from evidence submitted to the Senate inquiry into these bills that the government has been aware for some time that there were problems with the VET FEE-HELP system. The Consumer Action Law Centre, the Australian Competition and Consumer Commission, the Australian Skills Quality Authority and the Department of Education and Training all gave evidence that they were either receiving or aware of complaints as early as 2014. During those years, the Abbott-Turnbull government has gone through five ministers and has been so consumed with their own internal factional squabbles that they failed to take action to address this problem.

This legislation has been rushed through parliament, but it is a rush that Liberals imposed on themselves because of their lack of action over the time that this problem was emerging. It has tied this government in knots and they have failed to undertake proper consultation on the reforms. If this government had acted sooner, they could have saved billions of dollars which could have been invested in apprenticeships and TAFE instead of been wasted on dodgy private providers.

While Labor appreciates the urgency with which these reforms need to be implemented, we are concerned that the government will face challenges in the timely implementation of the new scheme, given the rushed nature of their response. While these bills address the rorts from unscrupulous private VET providers, there is a parallel crisis in public vocational education brought on by this government’s savage cuts. These reforms do nothing to restore the $2.75 billion the Liberals have ripped out of TAFEs, skills and apprenticeships. As a result of the Liberal cuts, there are 130,000 fewer apprentices. TAFE is the backbone of our apprenticeship system, yet the current Assistant Minister for Vocational Education and Skills, Ms Andrews, is questioning whether there is a need for new national partnership on skills—so much for jobs and growth.

The current partnership put in place by Labor expires in the middle of next year, and the government’s failure to commit to a new national partnership is putting at risk over $500 million a year of Commonwealth support for TAFE and skills. Labor supports our public TAFE system. That is why we put forward a TAFE funding guarantee before the last election, but for some reason the Liberals have an ideological problem with TAFE. They fail to understand the important role that TAFE has in the provision of technical and professional skills for a strong, competitive economy. And, if they think the private sector is going to do a better job, they only need look at the problems that had to be addressed by the bills we are debating right now. What those opposite have demonstrated with both their cuts to skills and their glacier-like response to the rorting of the VET FEE-HELP system is that they simply do not care about vocational education and training. Only Labor has a commitment to a strong vocational education and training sector, with TAFE at the centre as a public provider. We have been leading the debate for some time on the response to the crisis in the VET sector caused by the rorting of the VET FEE-HELP scheme.

Now the government, after criticising Labor policies, have been dragged kicking and screaming once again to the realisation that our policies provide the best solution. I welcome the government’s adoption of Labor policies, although with the thousands of students ripped off and billions of dollars wasted over the past couple of years while the government sat on their hands it really is a case of too little too late. I commend the bills and Labor’s amendments to the Senate.