 |
Edited transcript
Press Conference of Hon Dr Brendan Nelson, MP
Wednesday 24 July 2003
Parliament House Canberra
Well as many of you know the Australian Labor Party, today, has
announced its policy in relation to Higher Education and also in
relation to TAFEs. From the Government’s perspective, in one sense
it is flattering to see that a significant amount of the
Government’s proposed reforms for higher education have been adopted
by the Labor Party, but again Simon Crean and Jenny Macklin have
fallen at the first hurdle when it comes to the very difficult
issues that have got to be addressed if we want Australia to have a
world class internationally competitive university system.
The leaders of Australia’s universities argued that in order for
Australia in the 21st Century to have an internationally competitive
university centre, that HECS flexibility would be required. Then, at
the same time, we now have Mr Crean saying that students who come
from Beijing or Jakarta, who are full fee paying students in
Australian universities, are now going to have more rights to get
access and have the right to choose to pay full fees in Australian
universities, but apparently Australian citizens will not.
From the Government’s perspective also, if we are going to
include training initiatives, well of course in addition to the $1.5
billion in the first four years of the Government’s package, we
would add another $220 million that’s currently on the table in
negotiations with the States and Territories of the Australian
National Training Authority Agreement. The economic and social
development of Australia will rely increasingly upon what happens in
Australia’s universities, in science and research and the
development of new technologies. To create the kind of future
Australia both needs and wants needs a lot more than just pulling
out the taxpayers’ credit card and getting the taxpayer to pay an
even greater contribution to university education. It requires
Government to address some serious issues that are needed to make
Australian universities internationally competitive. We now have
Australian students that are going to study in North America, in
Europe, and in Singapore, where universities are advertising and
marketing in Australia to prospective students, to say to them that
if you want an internationally competitive higher education, if you
want to go to a world class university, then go to another country.
In other words to leave Australia. And what is required amongst many
things in reforming Australian universities is we have to move away
from the fantasy that every single one of the 38 universities are
exactly the same, that they needed to be funded and administered in
precisely the same way. We cannot, any longer in Australia, sustain
a one size fits all funding model for Australian universities. The
Labor Party has gone for the soft option. It has failed to address
the need for governance and management reform in Australian
universities. It has failed to address the need for industrial
relations changes, for work practices which are consistent with
modern work practices in any Australian working environment. It has
also ignored the need for the universities themselves, all of the 38
having argued for it, that it is necessary for them to be able to
set the HECS charge within a ceiling that would be set by the
Government, and importantly, the Labor Party is also ignoring the
right of Australian citizens, who are academically eligible to get
access to university, to have the same right as a foreign student if
they are academically capable of doing a course, to pay a full fee
for that course, and at the same time the Labor Party is proposing
to oppose the Government’s initiative to offer loans for the first
time to Australian citizens who want to go to any one of a number of
private universities in Australia.
Question: Simon Crean makes the point, in relation to your
argument in regard to overseas students, that Australian families
have paid taxes. Surely that is why they should be able to gain
access to universities without paying fees, unlike overseas
students?
Nelson:
That’s the very point. Australian students and their families
have paid taxes. They’ve paid for the infrastructure, the buildings,
the roads. They pay for the lecturers and all of the computing and
the infrastructure that’s important to Australian universities. But
there will always be more demand than any Government will be able to
afford to provide in places in Australian universities. Why should a
student, who has her heart set on doing Law Arts, for example, who
gets 99.1%, be told in effect that she has to go and do a HECS
funded course, that she doesn’t want to do, instead of being given
the choice to take a full fee paying place alongside a student who
would be given the same opportunity from another country.
Question: But that’s (inaudible) under Labor’s policy, because
they’re creating 20,000 new places. You’re only creating 5,000 new
places.
Nelson:
We haven’t yet had the opportunity to examine the full details of
what Labor’s proposing. But a fair proportion of those are taken up
in Medicine, Nursing and Teaching. You need to take into account
that 9,400 full fee paying Australian citizens, who are in
Australian universities at the moment, will be fazed out and those
places will need, obviously, to be replaced with taxpayer funded
places, if that is to be the case. But the fact is that there are
now and there always will be, more Australians who want to do
Dentistry, Medicine, Law, Veterinary Science, Photonics, Laser
Science. Any one of a number of courses that are currently offered
as full fee paying places, than are places available. The fact is
that there are students who do extremely well in Year 12, often in
very difficult circumstances, who frequently come from lower income
families, who miss out on a HECS funded place (the HECS cut off is a
supply and demand issue, it’s not an academic one, I mean the HECS
cut off is determined by the number of people that are trying to get
into a course, not the academic standard that is set by the
university). At the moment, Australian citizens are able, if they
choose to, to take up a full fee paying place if it is offered to
them. And what we are proposing to do, as a Government, is for the
first time, to offer those students a loan, so that they don’t have
to decline the opportunity simply because they don’t have the money.
It’s the kind of flexibility. What needs to be understood, and this
is what the Labor Party just cannot get, and certainly doesn’t have
the courage to address, that if you want Australia to have world
class internationally competitive universities, it is important that
they have the flexibility to not only offer the kind of courses
which are necessary for the Australian and the international market,
but also the flexibility in terms of setting HECS charges and in
choosing, if they wish to, to offer full fee paying places and for
Australian citizens to be supported in taking up those places with
loans.
Question:
Minister, couldn’t you also argue, that (inaudible) if Australia
wants to have a world class university education sector, that we
need to fund it properly and not keep loading charges onto the
students participating in that education. (inaudible) today,
suggests that there is building evidence that higher HECS charges
and higher student’s education charges are discouraging some
students from taking on education.
Nelson:
Firstly the Australian taxpayer, currently, funds about 75% of
the cost of university education. The funding of Australian
universities. Students cover about a quarter of the cost through
HECS, which they pay back once they’ve gone through the university
system and have graduated and are working. Under what we are
proposing it is a partnership. We are proposing that there be, over
ten years, $6.9 billion dollars of extra public taxpayer investment
in Australian universities, and another $3.7 billion made available
to students in the form of loans, which they pay back once they have
graduated and are earning more than $30,000 a year. What’s important
is that we, as a Government, and we as a society, appreciate that
the case for university reform rests on two inescapable, but
predominantly unpalatable truths. And the first is that Australian
universities need access to more money, and they need access to a
lot more of it in the long term. But that money is only half the
problem. The easy thing the Labor Party has chosen to do is to
simply pull out the taxpayers’ chequebook and say that it would put
more public money into it, without realising the importance, in
terms of driving quality, of having more flexibility within the
universities themselves for setting HECS charges, and also to
recognise that the Government has put an upper ceiling on those HECS
charges, which is 30% above what it currently is. It needs to be
remembered that under the Governments reform package, the taxpayer
will still be paying more than 73% of the cost of university
funding, and
Question:
Minister, isn’t it true that Australian students, on a scale of
international students, do pay compared to other countries,
significantly more?
(inaudible by another person) second highest amount of any
country, including the United States, who go through university
already.
Nelson:
I haven’t seen the table to which you are referring Sue, but I
suspect that that particular table includes fees that are paid by
foreign students, non student forms of revenue, in all its forms. I
mean the facts are, that according to Australian Education
International and IDP, which is the marketing arm of Australian
universities, Australia is the second most affordable country in the
world amongst the English speaking countries for university
education, including course costs and living expenses. And the fact
is that in a United States public university, for example, you’ll
pay 50% more and in a private university at least 300% more.
Question: Dr Nelson, if there is an amount of 20,000 and Labor is
proposing to increase (inaudible) to try and meet that, don’t you
have a challenge (inaudible) the average punters out there, that
your package, that you agree is (inaudible) called flexibility, but
loading up students with more costs. Don’t you have a challenge
convincing the Electorate that yours is the best long term
(inaudible) in Australia.
Nelson:
Well in terms of addressing eligible unmet demand Steve, what
we’re proposing to do is to fund, over five years, 32,000 places
fully funded. That’s 25,000 marginally funded over enrolled places,
it includes some 8,000 (mis-speak – should be ‘some 7000’) places in
Medicine, Nursing, Teaching, and then a variety of places right
throughout the University sector. In addition to that, by offering
students, for the first time, loans to support their choices, to
take up full fee paying places, so that they’re not forced to take
up a HECS place in Science, when they’d really rather be doing
Arts/Law. And at the same time offering loans to students who want
to go to private universities, and there are about 30,000 students
currently in private universities, as well as introducing a learning
entitlement which limits the amount of time for which the taxpayer
will carry a student to do repeated undergraduate courses, all of
those things between them will ultimately deal with unmet demand. I
mean, when you take into account Labor’s …
Question:
Surely it will only deal with a certain portion of the
Electorate, who A) can afford, or B) be inclined to take out loans
to go to university. I mean HECS.
Nelson:
Well Steve, when you take into account that this year, there were
40,000 Australians who got a place in a university, who will have
left university by the end of this year and will never return. In
other words the drop out numbers are twice that of eligible unmet
demand. The solution to the problem is much more complex than simply
pulling out the taxpayers’ cheque book and saying, right, we will
fund whatever number of places it takes. The solution to the problem
relies on improving the quality of what is offered in the
universities, of restricting universities in terms of over enrolment
and fully funding marginally funded over enrolled places. It also
requires initiatives, both at school and in the university, to make
students think more carefully about the choices they make before
they go to university. It should also recognise that there are
students who do want to go to non publicly funded universities who
currently don’t have access to Government supported loans which
might assist them. And all of those things together ultimately deal
with eligible unmet demand. I mean the reality is that the Labor
Party is basically saying that anybody who wants to go to university
ought to be funded to go there. And it’s time that we started to
think as much, at least with as much enthusiasm about the 70% of
kids who are not going directly from school to university.
Question:
Dr Nelson, it’s also the reality that if we do want to be
internationally competitive, in terms of education levels, that as a
nation we do need to contribute more and more dollars to education
and that if we are relying on loans schemes, then that is going to
be a disincentive to some people. (inaudible )
Nelson:
The fact is that from a university education there is a public
good from which we all derive a great social benefit, and there’s a
private gain. And what we’re trying to do is get the balance between
the two right. I mean the fact is, that under the reforms which the
Government is proposing, the university, not the Government, the
university will decide whether it will leave its HECS charges
unchanged, whether in some cases to drop them, or in other cases to
increase them. And for the first time, students will have a choice
about where they go to university and what they will receive, in
terms of what they will also be making a contribution towards. The
universities themselves will be required to actually think about
what they offer, what value does it offer to students and to society
generally. I also should point out to you that the maximum possible
increase, the maximum possible increase that a student could face,
graduating as a doctor, a dentist, a lawyer, or a vet, is $2,000 a
year added to their HECS debt. So the maximum possible debt that
they could face graduating as a vet, a dentist, or a doctor, is
almost $50,000, repaid through the tax system when the taxpayer has
paid for some three quarters of the cost of university education.
And the maximum possible debt in all other courses, of course, is
much less. For the 14% of students in the university sector, Fran,
teachers and nurses, we’re proposing no change to HECS at all. What
the Labor Party is also doing is seeking to deliberately confuse
people in relation to HECS funded places and full fee paying places.
98.3% of all of the 531,000 undergraduates in Australian
universities are in publicly funded HECS places. Only 1.7%, 9,400
students are full fee paying students.
(inaudible question)
Nelson:
Since 1997 the universities have the choice, if they wish to, to
offer a full fee paying opportunity to an Australian student, as
they do to a foreign student. And we’ve said that up to a quarter of
the students enrolled in a course could be full fee paying students.
Under that 25% limit, we’ve got to 1.7% of all of the students in
the system. I mean the fact is that those students are students who
are academically eligible, who quite rightly on merit missed out on
a HECS funded place, but they’ve been offered a place and an
opportunity. They have not received any taxpayer subsidy. What the
Labor Party is saying to those students – I mean what’s the
hypocrisy of this? Here’s Simon Crean, who today, has told us that
he pays the HECS charge for his child up front, and received a 25%
discount for which he should not be criticised. He is exercising his
right, he is exercising the choice that he wishes to make. But the
hypocrisy of him then saying to other Australian parents, whose
students have worked as hard as they possibly can, and get tertiary
entrance scores in excess of 99, who miss out on the course they’ve
wanted all their lives – he’s saying to those students and their
families, "Oh well, No, you’ve got to go and do a course in a HECS
place you don’t want, whilst we offer these full fee paying places
to foreign students. I mean what’s being offered her in terms of fee
paying places is choice. It is offering a student who is
academically gifted, but misses out on a HECS place, the choice of
doing something they might want to do, and supporting them with a
loan. I mean the Labor solution to the problem is to abolish these
places altogether. I mean there’s a kind of reverse elitism at work
here, that says that the only place that should be available in an
Australian university, is one that is funded by the Australian
taxpayer. And that is discriminatory against Australians. We welcome
140,000 foreign students into Australian universities, to do a
myriad of courses, 54% of them in commerce, IT and business, but for
some reason we say – well if you come from Rooty Hill, or
Broadmeadows, no you are not allowed to have a fee paying place.
Question:
(inaudible) of the full fee paying students, how many of the 1.7%
of full fee paying students come from Rooty Hill or Broadmeadows?
Nelson:
At the moment there would be a small number for the simple
reason, because at the moment if you are a student who comes from a
family that’s got money, or can borrow the money, you can take up
the place. And we are proposing to solve that problem by offering
the students a loan, which is 3.5% plus CPI, capped at 10 years.
Question:
(inaudible) and if we are playing the politics of envy, aren’t
you playing the (inaudible) when you start talking about foreign
students?
Nelson:
We welcome foreign students. In fact as you know there’s a $113
million package in the Budget to expand the opportunities of the
internationalisation of education. Of course we welcome foreign
students into Australia, but why should we give foreign students
more rights in Australian universities, than Australians.
Question:
But when you start talking about Jakarta and Beijing, you’ve been
a critic of (inaudible). Isn’t that simply engaging in (inaudible)
of another kind. Aren’t you trying to tell the Australian public
that foreigners have a better chance of getting into universities,
than Australians do?
Nelson:
At the moment, what we are trying to do as a Government is to see
that Australian students have as much choice, and as much
opportunity in Australian higher education as does anyone else. It
seems to me an illogical position for the Labor Party to say that it
welcomes students from other countries to take up full fee paying
places in Australian universities, at the same time that apparently
it wants to deny the same opportunities to Australian students.
Question:
(inaudible) 20,000 places, who’s going to be missing out on a
place at university? That’s the number of people that qualified to
get in now, so everyone who qualifies would therefore be able to get
a place.
Nelson:
But Sue, the fact is, and you’ve got to take into account the
9,500 students that will be removed from the system who will then go
into HECS places when you’re talking about any proposed increase in
places the Labor Party’s looking at. But the fact is that there will
always be more students who want to do a particular course instead
of the one that, if you like, their tertiary entrance score has put
them into. For example, if you get 98 and you don’t get into
veterinary science, why shouldn’t you, if there is a fee paying
place available, be offered that opportunity. Why shouldn’t you be
able to take it up instead of saying, "well I’ll go and do a science
degree" and take up a HECS place in a course that you don’t
particularly want to do. What it does, it broadens opportunities.
What the Government’s doing is expanding the number of HECS places
in the system and having expanded the number of HECS places in the
system, then say, to Australian citizens, to Australian students,
well if you want to we will also offer these additional fee paying
places as well. It creates opportunities.
Question:
How much is your (inaudible) places by, how much is your package?
Is it more than just lifting up the 25,000 partially funded
places…(inaudible)
Nelson:
Well the 25,000 marginally funded over enrolled places at a cost
of $347 million will be fully funded. They are places that are
currently disappearing from the system. The universities are ramping
back on over enrolment, as they should. As they should. In addition
to that, there are some 8,000 additional places (mis-speak should be
about 7000), growth places, Nursing, Teaching, Medicine, Regional
Nursing, there’s a whole variety of additional places in addition to
the 25,000. so there’s 32,000 over five years, over the first five
years, in addition to that, as I say, we’re proposing to offer the
students loans who take up fee paying places, and offering loans to
students who choose to go to private universities. Again a student
who goes to a private university is a student who is exercising
choice, doing something that they want to do in a university they
want to go to and by definition not taking up a HECS place in a
publicly funded university.
Question: What percentage of Australian students will be paying
full fees in, say five or ten years time?
Nelson:
We know that after six years, of a 25% limit on fee paying
places, that we have 1.7%.
Question: How many extra new university places (inaudible)
Nelson:
Look, that’s very difficult to forecast in terms, until we create
an opportunity where students have loans, have income contingent
loans which are designed and operate in the same way as HECS, with
the exception of the 3.5% interest rate, until we do that we don’t
really know. Or what we do know is that there are students who would
prefer to be doing another course, but didn’t take up a fee paying
place because they simply couldn’t afford it. We want to fix it.
Question:
Now Minister, do you have a comment or response to the story in
the Herald today that suggests this Report is out and you’ve been
sitting on it (inaudible). That there is evidence now, that
increased HECS is a discouragement to older students and students
from a lower socio economic background.
Nelson:
Firstly Fran, I haven’t been sitting on the report. I haven’t
even seen the report. In fact when I first heard of the report, I
said "what’s this report?"
Question: (inaudible) You still haven’t (inaudible).
Nelson:
Well, I’ve seen a copy of the report this morning. And I’ve seen
the stuff in the Press.
Question: (inaudible) the Department.
Nelson:
The Department has produced this report, which predates, if you
like, the Review which we did of university education. All of the
material in the report, of course I have seen, over a period of
time, because what the report is, is a composite of all of the
information and data and all the stuff that’s available.
Question: (inaudible) shows that disadvantaged students are
taking (inaudible)
Nelson:
16.5% of undergraduate places are filled by the students from the
poorest socio economic status suburbs. We know that from Bruce
Chapman’s work, that in 1988 19% of students, 18 year olds from the
poorest SES were in Australian universities. By 1993 that had moved
to 20%, by 1998 it had moved to 25%. In fact I think from what I
understand of the report, I think the report is difficult in the
sense that a lot of the data stops at 1998 or 2000, or 2001, which
is one of the frustrations in trying to design higher education
policy because you’re often predicated on what’s happened 2, 3, 4 or
5 years previously. And again, in our package, we’ve got initiatives
for equity programs, specific higher education equity programs,
Indigenous students, and initiatives which are designed to target
particularly students from low income backgrounds. I mean the
biggest barrier to students getting into university is not money,
it’s a lousy Year 12 outcome. Much has been said by the Labor Party
about merit based access. Of course, by definition every student
offered a full fee paying place, has a lower tertiary entrance score
than a student that got a HECS place, because the HECS places are
distributed on merit. Those who get the highest tertiary entrance
score get the places as they come. But those students who miss out
on those HECS places should not be described by anyone as being
dumb, or in some way as being intellectually inadequate. As the
universities themselves will tell you, providing they’re above a
certain level they’re quite academically adapted for the course. But
in terms of….
Question: (inaudible) the report (inaudible) decline in the
number of disadvantaged students going to university?
Nelson:
No, there’s been an increase in the number of students from low
income families that are going to university, but what’s happened,
because the rate of growth of participation from students from
middle and higher income families has increased at a greater rate
then the proportion across the sector has remained essentially
unchanged. But the total numbers have increased. I think we’ve got
about 96,000 students from low SES
Question: (inaudible) proportion, is their any evidence to say
that a proportion of our university population comes from lower
socio economic backgrounds are taking up the opportunity less than
those from (inaudible)
Nelson:
As far as I know there isn’t. We spent a lot of time with Bruce
Chapman, who designed HECS, was a Keating Adviser. Bruce is probably
the pre eminent person in the country on looking at student debt,
its impact on participation, and all of the advice that we received
from Professor Chapman, and indeed other research that we’ve got
suggests that, that what we are proposing will have no adverse
impact on participation from low income students. I mean, the single
biggest predictor, as I say, the biggest influence is a Year 12
outcome. And in terms of merit, in case you don’t know, there are
thousands of Australian students who get a HECS place, who have
their tertiary entrance score elevated by virtue of where they live,
by virtue of their difficult circumstances. If you were to purely
apply the merit argument, there are many students from low income
families that wouldn’t get to university today. We strongly support
those kinds of initiatives. We think it is important. It’s an
important equity measure. But people, and the Labor people in
particular, need to be a little bit careful before they go too far
in pushing the pure merit and nothing else sort of argument.
Question: (inaudible) If the principle of flexibility is so
important, why cap the (inaudible) And secondly, if (inaudible) so
important (inaudible) the people with a capacity to pay, or capacity
to borrow (inaudible) to buy their way into (inaudible) education
system, why does the Government appear opposed to Doctors, for
instance, who (inaudible) for wealthier patients to jump the
Medicare que.
Nelson:
Firstly, in terms of the 30%. The 30% is based on the advice that
was given to us by Professor Chapman and others, in that they said
that up to 30% would not discourage low income people from going
into university. But if it were to increase above that it would
certainly have a detrimental impact on low income students going to
university. Also of course the way in which HECS operates, and the
way in which we propose to have fee help operate, the loans which we
would offer to full fee paying students, is of course that you don’t
have to pay a cent at the university gate, you only pay back the
loan once you are working and as we’re saying earning more than
$30,000. I mean the real cost that the students face, which is not
addressed in the Labor Package by the way, the real costs that the
students face are computers, and books and living expenses, rent,
compulsory union fees, a whole range of things which they face when
they go to university. We need to keep this all in perspective too.
It’s rather ironic that there’s been a lot of talk today about
possible increases to, universities having flexibility to increase
their HECS charges by up to 30%, but the NSW Labor Government has
just announced a 300% increase in TAFE fees, where 26% of the
students in TAFE come from the poorest socio economic status suburbs
in the country. There’s no loans scheme available for them. They’re
abolishing quite a number of the ‘no fee’ opportunities in TAFE.
We’ve got full fee paying degrees, $8,000 - $14,000 a year in
Victorian TAFE, no loans there. (inaudible)
50% increase in charges on apprentices that are going to TAFE in
South Australia. I mean, these are fundamental and critical issues
to equity arguments in terms of education. What we’re proposing in
our reforms to higher education, as well as $1.5 billion of
increased public investment, are fees for students, all of which are
supported by loans which are not paid back until they are earning an
income, an income in excess of $30,000 a year. And with all the
debate about university, please, none of us should ever forget that
some 42% of men in this country between the ages and 25 and 44, earn
less than $32,000 a year. The average graduate starting salary last
year, the average salary earned by university graduates in 2002, in
all but one case, and that is Law, is higher than the maximum
possible HECS charge that they could leave university with after
these reforms are implemented. Everything should be kept in
perspective.
Question: (inaudible) question about what Labor policy
(inaudible) degree, (inaudible) student. Isn’t there a fundamental
difference, if those thick and rich students perform well in their
first year, they can transfer into a HECS place? Now foreign
students cannot do that. Why can fee paying students do that?
Nelson:
Sam, no-one should be described as thick. I don’t think any human
being should be described as thick or dumb, or any similar terms of
derision. The second thing is that, when you look at where the fee
paying places are there are 784 courses that offer full fee paying
places to Australian students. Those Australian students are, by
definition, Australian citizens. They are taxpayers or come from
taxpaying families. Once they get into university they have to meet
and pass all of the same tests and standards as every other student
in the course. There are 9,400 full fee paying students in
Australian universities. Last year, 244 transferred in the second or
subsequent year to a HECS funded place, created by a dropout rate
approaching 40% across the sector. If they’re accepted, if they pass
second, or subsequent years, and vacancies are created by students
who drop out and the university considers them eligible, why
shouldn’t they be able to transfer into a HECS place. Keep in mind
these are often students that got 97, 98, 99 – who could have easily
taken up a course, a HECS place in any one of a number of courses in
the university. So, if they are accepted into Laser Science, or
Photonics, or Business at Southern Cross, or Law at Melbourne
University, and there’s a dropout from first year and there’s a
vacancy, why shouldn’t they be allowed to take it up? And the
foreign students cannot take it up, because three quarters of the
cost of it is carried by the Australian taxpayer.
top |
