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Access to post-secondary education should be based on merit and not ability to pay. We know that graduates of further education typically enjoy higher incomes over their lifetimes than non-graduates and that tertiary and further education is critical to personal growth.
It is estimated that Australians without a Certificate III could be earning an additional $400,000 on average over the course of a typical working life if they attain a Certificate III qualification or higher. The benefits of higher and post-secondary education, however, historically have not always been shared widely and equitably in our society.
Instead, a disproportionately higher of number students from privileged backgrounds have enjoyed access to opportunities for further education while others have been left behind.
The fundamental principle that all Australians should have access to post-secondary education is not only about equity and fairness, but it is also about ensuring that we as a nation develop the skilled workforce we will need to continue to be competitive into the future. There is international consensus that a population with a high proportion of skilled and qualified individuals will be essential for national economic prosperity in a future which will be characterised by a rapidly moving global economy.
We need to break down barriers to participation in post-secondary education for individuals from disadvantaged backgrounds both to ensure equity of access for these individuals and to ensure the continued prosperity of our nation.
While the cause of the under-representation of people from disadvantaged backgrounds in higher education is multifaceted, it is widely agreed that the economic costs associated with attaining further education is a major barrier for these individuals. In the 1980s former Labor Minister John Dawkins began a national conversation about the inevitable need for the growth of our universities in order to remain internationally competitive. To fund this growth, the reforms called for improved efficiencies within the system but also necessitated student contributions.
At this time, there was a concern that introducing student contributions could erect financial barriers to participation for economically disadvantaged individuals. True to the core Labor values of fairness and equity, the Labor Government at this time chose not to impose a scheme whereby students would be forced to pay tuition fees upfront but rather to allow students to defer their fees through income contingent loans.
This meant that students would not need to pay the cost of their education until they entered the workforce and were earning a decent income - this way, upfront tuition fees would not become a financial barrier for students wishing to study at an Australian university. Income contingent loans have been vital to improving access to university education for individuals from disadvantaged backgrounds.
In much the same way as the Higher Education Contribution Scheme (HECS) has opened doors to education for less privileged Australians, so too will the recent decision to transform vocational education in this country including by introducing income contingent loans for higher level VET courses. We know that people from disadvantaged backgrounds want to pursue further training, to upskill and to secure a better job and yet for some the cost of tuition fees has prevented them from doing so.
The skills reform package agreed to at the recent COAG will transform our vocational education and training system most importantly by making it accessible to many more Australians. The reforms include providing study-now-pay-later loans for government subsidised Diploma and Advanced Diploma students so that they have an opportunity to defer payment of tuition fees rather than having to pay upfront. This extension of study-now-pay-later loans to higher level VET courses will remove the financial barrier that upfront tuition fees can pose and open the doors to further education for many more Australians.
Another critical element of the reform package is the move to guarantee all working age Australians a government subsidised training place up to their first Certificate III. I believe that these two reforms will be critical to ensuring many more Australians are able to obtain post-secondary education, improving their employment opportunities and wage prospects.
Further education is a life-changing experience which should be available to all Australians and not just a few. Governments must not underestimate the positive impact on national productivity of improving access to further education and training to those who may not have had access in the past - it is in our country’s national interest.
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