Andrew Leigh

Higher Education Support Amendment (Response To The Australian Universities Accord Interim Report) Bill 2023
Second Reading Speech
House of Representatives, 4 September

There are hundreds of thousands of 18-year-olds who began university this year. Those people were born in 2005, and they'll be at university from 2023 to 2025 if they do a regular, three-year bachelor's degree. Those people won't be eligible for the pension until 2072. At the end of their working lives, they will be dealing with the advanced technology of a workplace in 2072. We don't know the exact contours of what that labour market will look like, but we do know that it will be the sort of labour market which will reward high levels of skills. Just as the level of skill in the Australian economy has steadily increased over the last couple of generations, it will continue to do so for the current cohort. That means that, to a school leaver today, who was born in 2005 and who isn't eligible for the pension until 2072, university looks increasingly attractive. University won't be for everyone, but, in an age in which artificial intelligence is increasingly taking more routine jobs—automation of mobile services and factory automation are filling niches once filled by workers—higher levels of education are valuable. Our crystal ball for forecasting the precise jobs that will rise is a bit cloudy, but we do know that it's a very good bet that the jobs of the future will require higher levels of formal education than the jobs of today.

Where will those new university graduates come from? They'll tend to come from groups that are currently underserved. At the moment around half of Australians in their late 20s and early 30s has a university degree, but that level differs quite markedly across Australia. In the outer suburbs of major Australian cities, only 23 per cent of young Australians have a university degree. In the regions, only 13 per cent of young Australians have a university degree. Among young adults from poor families, only 15 per cent have a university degree. Among Indigenous Australians, only seven per cent have a university degree. For a young Indigenous man today, you're more likely to go to jail than you are to go to university. Right across the population, 36 per cent of Australians have a university qualification today, and it's been forecast that by mid-century it's going to be necessary to have 55 per cent of the population with a university qualification.

Labor is committed to ensuring that we provide more opportunities to get to university for those who currently struggle to find a pathway into university. This bill flows from an interim report by a panel which is chaired by Mary O'Kane and whose other members are Barney Glover, Shemara Wikramanayake, Jenny Macklin, Larissa Behrendt and Fiona Nash. Commissioned by Education Minister Jason Clare, this is the most important higher education review in 15 years—that is, since the Bradley review. Among its recommendations are recommendations contained in this bill.

One of those is to remove the 50 per cent pass rule and to improve student support. At present, students are required to pass at least 50 per cent of the units of study they undertake to continue eligibility for Commonwealth assistance. These pass rate requirements were brought in at the beginning of 2022 under the former coalition government's Job-ready Graduates Package. Their aim was to dissuade students from continuing in courses that they're not academically suited for, but the practical effect has been overly punitive. We should be helping those students to succeed, not forcing them to quit. Western Sydney University this year alone has seen 1,350 students lose their funding and withdraw from their courses. The 50 per cent pass rule affects a disproportionate number of students who are Indigenous. It pushes out of university a disproportionate number of students who are first in family. It forces out of university a disproportionate number of students who are from poorer backgrounds. These are the very students that we need to continue on in university if Australia is to ensure that the education of the population matches the technological demands of the labour market. If we don't manage to do that, inequality will worsen.

In their book The Race Between Education and Technology, Claudia Goldin and Larry Katz lay out a simple way of thinking about inequality. That is that inequality worsens at times when education stagnates and technology advances. Their theory is that only by education keeping up with advances in technology can we ensure that the gap between rich and poor doesn't widen. But the benefits go, too, to growth. We know that attending university boosts the productive capacity of those who get further education. It doesn't just benefit them; it benefits their coworkers. There's a positive spillover from higher levels of education. The earnings benefit is somewhere in the order of 10 per cent additional earnings for every additional year of further studies, meaning that a three-year bachelor's degree delivers something in the order of a 30 per cent wage gain. Then, on top of that, we see the benefits to those who work around university graduates. By scrapping the 50 per cent pass rule, we're going to ensure that there are more students who are able to get support, rather than simply be forced out. The rule has hit more than 13,000 students at 27 universities. Its scrapping has been called for by universities right across the country, including the University of Adelaide, Monash University, the University of Technology Sydney, the University of the Sunshine Coast, the University of New England, Queensland University of Technology and Western Sydney University.

This bill introduces requirements on universities and other providers to have policies in place to help students successfully complete their studies. Those policies will identify students who are struggling and connect those students with support services. The Department of Education will issue a discussion paper to consult with universities and providers on the content of those policies, including how they're going to identify students and connect them up; provide non-academic supports, including financial assistance, housing assistance and mental health supports; have crisis and harm response arrangements in place; identify trained academic development advisers; and ensure that those supports are culturally appropriate.

It's also important that universities consider proactively offering special circumstances arrangements, where a university is aware of a significant life event for a student, and that they provide targeted literacy, numeracy and other academic supports. It's important, too, that these interventions be properly evaluated. We have set up, within Treasury, the Australian Centre for Evaluation, which will work collaboratively right across the Commonwealth in improving the quality of evaluation and carrying out more rigorous evaluations, including robust randomised trials. In the area of student support, a randomised trial carried out by Alfred Paloyo, Sally Rogan and Peter Siminski looked at the impact of peer assisted study sessions at a major Australian university. They did that through an encouragement design. All students were eligible for the peer assisted study sessions, but the study sessions were randomly marketed to a subset of students. That then increased uptake and allowed the researchers to look at the causal impact of peer assisted study sessions on student achievement. It is that sort of careful, rigorous evaluation which needs to be conducted on these programs, on the programs which are providing academic supports and on programs that are providing non-academic supports.

The other key measure in the bill that I want to draw the House's attention to is extending demand driven places to all Indigenous students. The existing demand driven measure applies to regional First Nations students. Under this bill, the eligibility for demand driven funding will cover metropolitan First Nations students studying bachelor and bachelor honours courses, except medicine at a table A university. That goes towards Closing the Gap outcome 6: to increase the proportion of Aboriginal and Torres Strait Islander people aged 25 to 34 who have completed a tertiary qualification—that is, certificate III and above—to 70 per cent by 2031.

It means there will be no cap on the number of First Nations students who can enrol in Commonwealth supported places. The Department of Education estimates this may double the number of Indigenous students at university within a decade. The measure has received support from Universities Australia, the Australian National University, the University of Queensland, Western Sydney University, Macquarie University, James Cook University, the University of Southern Queensland, the University of Melbourne, the University of Adelaide, the University of Queensland and the University of Technology Sydney. It builds on the government's election commitment to deliver up to 20,000 Commonwealth supported places and fee-free TAFE.

It is vital that we increase the number of Indigenous students at Australian universities and that we create more of those opportunities that we know come from higher levels of education. We understand, as a government, the damage that was done to students, and to the sector more broadly, by the former coalition government's ill-conceived Job-ready Graduates Package—a package which did nothing to redirect student enrolments in the way the former government intended but simply disproportionately loaded more debt on students in disfavoured courses. The former government's scrapping of the demand-driven system has meant that fewer Australians can get the benefit of attending university. It's exactly the opposite of what Australia needs at a time when technology is racing ahead. As technological advances improve, we have to give more Australians the opportunity to attend university.

I want to commend the Minister for Education, Jason Clare, for thinking big in this space and thinking about questions such as whether we will ultimately require new universities. The number of universities per capita in Australia is significantly lower than that, for example, in the United States. New institutions can provide fresh opportunities and place useful competitive pressure on other universities to ensure they're doing their best job of serving their students and the broader community. When I look to the example in the United States, where I was fortunate to study for a bit, the liberal arts college model in the north-east in particular is one which seems to be largely absent from Australia—the notion of a university that prizes teaching above all else and whose faculty members are often researching effective teaching practices. That is, they are the leaders for the nation in improving the quality of academic instruction. Institutions along the lines of a US-style liberal arts college could be a benefit to the Australian higher education ecosystem. The minister is also thinking about the idea of a universal learning entitlement; more work integrated learning and courses; a jobs broker program; a national student charter, akin to the New Zealand model; and a national skills passport would include all of your qualifications, microcredentials, prior learning, workplace experience and general capability.

We know that it is going to be essential to continue to learn through one's career. The old-fashioned model of a block of education at the start of a career which you draw down through the course of the rest of your career has gone out the window. When I visit mechanics workshops, as I did a lot when we were campaigning for mechanics to get the data they need to fix modern cars, I was struck by the degree of ongoing learning that's happening in those workplaces—mechanics learning to fix new electric vehicles and also tapping in to be able to update the software on new cars. Sometimes that learning was happening formally; sometimes it was through watching a YouTube video. But it was very clear that those mechanics who weren't engaged in continuous learning would be struggling in a decade’s time. That's the approach we need to take right across education, creating continuous learners who are able to adapt and adopt new technologies to thrive in the modern age.