Transcript - Press conference

JASON CLARE, MINISTER FOR EDUCATION: Thanks very much for coming along to Auburn this morning, everybody. We have a good education system in Australia, but the truth is that it can be a lot better, and it can be a lot fairer. And that’s what drives everything that I do as Education Minister and it’s what underpins the announcement that we’re making today. 

What we’re announcing today is a big deal for 3 million Australians. It will reduce the amount that they have to repay in student debt every year. And this builds on the reforms that we’re implementing right now. In February I released the Universities Accord. That’s a big report. It’s a blueprint to reform our universities and our higher education system over the next decade and beyond. And in May I announced the government’s first stage of our response to that report. It implements 29 of the 47 recommendations in that report in full or in part. 

One of the things that’s in that report is a change to the formula about how HECS, or student debt, is indexed, and backdating that to the 1st of June last year. That’s what we announced that we would do in the Budget. And the impact of that is that it will wipe about $3 billion of student debt for more than 3 million Australians. 

But what we also announced in the Budget is that for the first time ever we would introduce, at a Commonwealth level, paid prac. That’s financial support for teaching students and nursing students, midwifery students and social work students to provide them with a bit of practical support while they do their practical training, a bit of financial support to help them finish their university degree. And what we also announced in the Budget is a massive expansion of the free courses that help people to get ready to do a university degree, what we call Fee-Free University Ready courses. They’re a bridge for a lot of people between school and university to help more young people from our outer suburbs and from our regions in particular to get a crack at going to university and to succeed when they get there. 

And what we’re announcing today is the next step. What we’re announcing today will reduce the amount of money that you have to repay in student debt every year. It’s another recommendation of the Universities Accord and, in particular, it’s a recommendation put to the Universities Accord team by Professor Bruce Chapman, the architect of the original HECS scheme.

And what it will mean if you’re on, say, 70 grand a year, is that you’ll have to pay $1,300 less a year than you currently have to. And if you’re on about 80 grand a year it means that you’ll have to pay about $850 less a year than you currently have to. What it means is that there’s more money in your pocket rather than in the government’s. And on top of this, it will also mean that you won’t have to start paying back your student debt until you earn 67 grand a year. At the moment it’s about $54,000 a year. 

What this will do is help people who are just starting out, who’ve just finished uni, who’ve just finished TAFE, and who have now got to pay the bills, pay the rent or are saving for a mortgage or they are trying to start a family. And this will just take a bit of the pressure off and help a lot of young Australians right across the country. 

Happy to take questions. 

JOURNALIST: I guess, because it’s going to take students longer to pay that debt off and, of course, they’re having to pay interest on that, are they going to end up paying more overall? 

CLARE: That’s not necessarily the case. It’s not the advice that we’ve been given. But that will be impacted by a range of reforms that the government is implementing, and we’ll have more to say about that in the coming days.

JOURNALIST: How tough is it for students? We know the cost of living is affecting everyone, but specifically for students who are just starting their working life. 

CLARE: The fact is, things are really tough for a lot of young Australians. You’re straight out of TAFE, straight out of uni, you’re on a low income. You’ve moved out of home, you’re paying the rent, and then you’ve got to start paying back this bill. That can mean that it can be hard to make ends meet. And so, by making sure that there’s more money in your wallet, in your purse, in your pocket rather than the government’s, it’s just going to make life a little bit easier and take the pressure off a lot of young Australians right across the country.

JOURNALIST: Will you take a look at what that interest rate is potentially and maybe set a fixed rate? Or are there other measures – 

CLARE: We’ve already done that. So in the Budget what we announced is that we’re going to set that interest rate or, in fact, what that indexation rate is at the lower of either inflation or wages. And that makes sure that the debt doesn’t go up faster than wages do. 

JOURNALIST: Sorry. Minister, you’re adding hundreds if not thousands of extra dollars into people’s pockets. As you said, you wiped 3 billion in student loans from the Budget. Is there a risk this is inflationary?

CLARE: No, that’s not the advice that we’ve received from Treasury. This does not affect returning inflation to within the band. In fact, I had a chat this morning with Professor Bruce Chapman who, as I said, is the architect of the original HECS scheme. He made the point to me – and you can actually see this if you read the Universities Accord report – that one of the things that this does by improving this and reducing the amount that people have to repay every year is that it will encourage a lot more people to work more hours, particularly Australian women who are current unfairly affected by the way the system works at the moment. So this is good for productivity and good for encouraging people to work more hours. 

JOURNALIST: [Indistinct] 

CLARE: This is about making sure that we implement reforms to make our education system better and make our education system fairer. That’s what the Accord said that we need to do. So this is real, practical reform. It’s reform, as Professor Chapman told me this morning, that’s going to encourage more people back into the workforce. But it’s also reform that’s going to put more money in people’s pockets. 

You know, I made the point a moment ago in answer to an earlier question that young people are doing it tough. And a lot of young people that are just starting out, just finished uni, just finished TAFE, that are on low incomes and have to pay the rent, have to pay the bills also have to pay this bill, have to pay this debt off when they’re earning from $54,000 a year at the moment. By pushing this up to $67,000 a year it helps to take a bit of the pressure off them. And by reducing the amount that they have to repay every year, then it means more money in their pocket rather than Canberra’s.

JOURNALIST: Minister, I understand that the threshold is going to go higher. Can you also talk me through the new system wherein payments are based on a proportion of the person’s income? How does that work? 

CLARE: Yeah, and I think there is a table in the press release that sets all of that out. The intent here is to make sure that we’re reducing the amount of money that people have to pay every year. Bottom line is we want more money in your pocket rather than the government’s. And the best example of that is somebody that’s on 70 grand a year. It will mean that they’re paying $1,300 less a year than they currently have to. For someone on 80 grand a year, they’ll pay $850 a year less than they currently have to. Across the board on average it’s around $680 less a year than students or graduates currently have to. And nobody will be worse off under this. It will mean that everybody earning up to $180,000 a year will pay less every year in their student debt repayments.

JOURNALIST: Minister, I understand the Prime Minister will talk more to this policy in a headline speech tomorrow [indistinct]. 

CLARE: I won’t pre-empt what the Prime Minister has to say tomorrow, but just underline the point that I made a moment ago. That there are a lot of young Australians that are doing it tough. And this is about helping them – millions of Australians who’ve just finished uni or just finished TAFE and they’ve got to pay the rent, they’ve got to pay the bills, they might be saving for a mortgage, wanting to start a family, and they’ve got to pay this debt back too. And this is about taking the pressure off them. 

JOURNALIST: Minister, just a final one from me: there’s some reports in The Australian that backbenchers would like to see travel upgrades sort of taken away for personal travel of politicians. Do you think that’s something that should be looked at? 

CLARE: I think the key thing here is that where there’s an upgrade it needs to be declared. That there needs to be a form filled out and it’s stuck on the internet for everybody to see. And that people are honest about it. I said that yesterday, and I reinforce that point again today.

JOURNALIST: Is there any relief for international students here, financial relief? 

CLARE: No. The student debt system, the HECS system, as we used to call it, the HELP system, is for Aussie students, for Australian students. International students are not eligible for this current scheme, and I think everyone would be aware of the legislation that’s in the Parliament at the moment that’s focused on setting a cap for international students. We want to return migration levels to pre-pandemic levels, and as part of that what we want to do is return international student numbers to roughly pre-pandemic levels as well. And that legislation is in the Parliament. It’s been in the Parliament now for over 160 days. When the Senate sits at the end of November, I hope that they will pass that. 

On that point, there’s legislation in the Parliament to make sure that we wipe $3 billion of student debt for more than 3 million Australians. That will be debated in the House of Representatives next week. And I urge the Parliament to back that too. 

There’s legislation that’s just passed the House that’s now in the Senate to establish for the first time a National Student Ombudsman so that when the worst happens to students or staff – students in particular – at universities, then there’s someone that they can go to where they can get real action to help them. The fact is, we know now that one in 20 students have been sexually assaulted in their time at university and one in six have been the subject of sexual harassment. And not enough has been done on this. Our universities have let our students down and previous governments have let our students down. This Ombudsman is about fixing that.

And I see reports in the media over the last day or so about a report that was ripped up by students at the University of Sydney. The reason that I brought this legislation to the Parliament to create a National Student Ombudsman is in part because of an organisation called End Rape on Campus. People who have dedicated much of the last decade to advocating for, in particular, young Australian women who have been the subject of the most shocking abuse and violence in our universities. And when I see what are, I’m told, Young Liberal students ripping up a report that says, “End rape on campus”, it makes me sick to the stomach. It really does. I’m glad that the University of Sydney is investigating this, and I call on Peter Dutton and the Liberal Party to investigate this as well.

Okay, thanks very much, everyone.