The release today of the Grattan Institute’s report – HELP for the future: fairer repayment of student debt – continues to expose the gross mismanagement of the VET FEE HELP scheme by the Abbott/Turnbull Government.
While the Liberals have been asleep at the wheel national VET FEE-HELP debt has blown out from $699 million in 2013 to an estimated $3 billion in 2015.
The Grattan Institute report clearly shows that if this crisis continues unabated then the entire Higher Education Loans Program – including HECS, which is the backbone of an affordable higher education system – will be jeopardised.
While the crisis in the vocational education sector escalates, Minister Scott Ryan continues the excuses made by three former ministers over the last two years by refusing to take any responsibility for the systematic problems they have created in their ideological pursuit for deregulation and private provision of education.
The Liberals have repeatedly knocked back Labor’s proposal to put in place a Vocational Education and Training Ombudsman, ban or restrict the use of brokers to recruit students to courses funded by VET FEE-HELP, and cap tuition fees for VET courses eligible for VET FEE-HELP.
Labor has previously and will continue to reject calls for a lower repayment threshold of $30,000 or $40,000 on the grounds of fairness and impact. A threshold $42,000, as recommended by the Grattan report, also fails these tests.
As the report itself acknowledges if the threshold is lowered it will be women, lower income earners, people in part time work and recently graduated young people who would be paying more, sooner.
The income contingent loans scheme (HECS-HELP), introduced by Labor, is based on the principle that you repay your contribution only if you benefit from your education in the way of higher salaries.
It is not a loan scheme as is understood in financial circles, but a social insurance program.
Imposing a lower threshold, or introducing a death tax by way of having the Australian Tax Office raid your estate, violates this basic principle.
Only Labor has a plan for fair, sustainable funding of universities. And only Labor has a plan to stop the rorts in the VET sector and protect TAFE.