Topics: Bill Shorten’s upfront cost for VET students.
E&OE…
GREG JENNETT
Bill Shorten’s budget speech in reply has promised to hit the troubled vocational education industry hard by capping taxpayer loans to students. Private training colleges have been exposed for rip-off fees, dodgy practices and low graduation rates. Labor would limit loans to students in the private sector to $8,000. The Government claims that approach risks pushing fees even higher. The Minister for Vocational Education, Scott Ryan spoke to us.
JENNETT
I think it is broadly accepted across politics there is a problem in the VET sector, it is what to do about it to remedy it. Labor has come up with a solution, which is a cap of $8,000 on the private providers. What is wrong with that?
SCOTT RYAN
Well, every problem we have got in the sector now, from students being taken advantage of, to inflation in fees, the loans not being repaid, shonky providers, actions of brokers, they are all a direct result of the scheme and the way it was introduced by Labor in 2012. No thought was given to bringing in a scheme that didn’t have any sort of protections for students and taxpayers. This is another thought bubble by picking a figure out of the air and saying, “That’s going to be a cap for students borrowing”, not taking into account different courses cost different amounts in different places. In fact, there are lots of courses that cost more than $8,000 which will lead to students paying upfront fees to access training in TAFEs and at private colleges!
JENNETT
What do you suggest? That fees will now go up, will they, as providers try to load on up-front fees over and above 8,000?
RYAN
Well, in my consultation with the sector, before I released our discussion paper last week, which outlined a whole range of options to deal with the crisis Labor created, one of the points raised was a unilateral cap will lead to fee increases below that. The secondary effect will be any courses that cost more than that, you will then have an up-front fee to access vocational training, which is particularly important for those who are disadvantaged, because, of course, it mean students don’t get to choose the course they want, it will be the course they can afford.
JENNETT
Do you see a case for a cap down at 3 or $4,000? Is it an effective mechanism? It was canvassed by your paper?
RYAN
We outlined a number of options in this sector to deal with the crisis that Labor’s created. There were caps on loans, potentially. There were ways of considering the reasonable cost of various courses, because different courses cost different amounts. Online course management will have a different cost base than, for example, something that requires more physical training, such as nursing or something that requires more equipment like information technology.
JENNETT
It can’t be an effective marketplace in this area. Some of them are overinflated.
RYAN
Absolutely. The discussion paper goes into great detail to talk about the enormous cost inflation that occurred under Labor’s scheme. The fact that disadvantaged students ended up being charged more than those who were better off. In fact, in the most tragic element, Indigenous students ended up paying higher average fees. It all goes to this point, that in this sector, because of the problems, you actually need to think of what are the second and third round effects, what do people do when you actually introduce a policy? There isn’t going to be a single silver bullet. It is a very complex sector that actually needs a seriously-considered solution. Which is why we’ve put all the facts out there in our discussion paper, outlined what went wrong, and then said, “Let’s look at the options in the context of what happened in the past, so that we don’t create the same problem again.”
JENNETT
Apart from going after dodgy operators, which is already underway, as I understand it, what are you actually proposing to do?
RYAN
We have introduced more than a dozen measures over the last 18 months that crack down on the dodgy practises that we saw under Labor’s scheme. We’ve got a serious compliance activity, that has got a number of court actions in place with the ACCC, we have had an AFP raid in one area, and we have got ongoing efforts in that. We are also taking care of the students where providers have fallen over to ensure they can continue their course. In our discussion paper, we’ve outlined all options, it is open for two months for consultation, so then after July, if the Government is returned, and I am in this position again, I will have an opportunity to take that and redesign the scheme for 2017.
JENNETT
That’s where you could lock into, presumably, caps if you wanted to?
RYAN
We want a considered approach that looks at the impact on providers and the impact upon students. But a unilaterally announced cap that Bill Shorten announced in his Budget Reply last night showed yet again that Bill Shorten is all about politics. He doesn’t have a plan for Australia, he doesn’t have a plan for vocational education. Last night he launched personal attacks on the Prime Minister, he did it again this morning. We are going to see that over the coming weeks, I’m certain, because it is clear, whether it is vocational education or the economy, Bill Shorten doesn’t have a plan for the country. He just has political and personal attacks.
JENNETT
You are about to hit the campaign trail. What are you predicting? A particularly nasty campaign?
RYAN
I think we have seen it from Bill Shorten, that he doesn’t have a plan. He doesn’t have policies, he has soundbites and he has personal attacks. Last night he has continued the personal attacks on the Prime Minister. He has launched his class warfare campaign and I might say with vocational education the impact of that on disadvantaged students, who suddenly have to provide up-front fees to get access to training, or even to TAFE, is a sign that for Bill nothing has changed. It is all about the polls and the personal attacks.
JENNETT
An ongoing topic of debate through the campaign. Thank you.
RYAN
Thank you.
(ENDS)