Federal Budget

The Hon. K.J. MAHER (14:21): My question is to the Minister for Employment, Higher Education and Skills. Can the minister inform the chamber as to the impact of the federal budget's savage cuts on South Australian universities and university students?

The Hon. G.E. GAGO (Minister for Employment, Higher Education and Skills, Minister for Science and Information Economy, Minister for the Status of Women, Minister for Business Services and Consumers) (14:21): I thank the honourable member for his most important question. Indeed, there has been a series of extremely savage cuts in public funding to South Australian universities and, added to the increased fees that are to be paid by students, this will total almost $250 million over four years.

South Australia's university students will now have to borrow more money, pay higher interest on their loan and also be required to pay back their debt faster. Students across the country are incredibly angry about these unfair changes—and rightly so—and today we expect to see thousands of students protesting as part of the national day of action, loudly telling the Abbott government that these cuts are completely unreasonable and prohibitive.

With the 20 per cent cut for each student to public universities, South Australian universities are expected to lose $78 million over the next four years. This means that students will have to pay back an extra $39 million per year on average in higher interest rates. They will also have to start their repayments once they start earning $50,638 rather than the current amount of $53,300, so the threshold has been increased or decreased as the case may be. As a result of these changes, a bachelor degree student who is already paying between $6,000 and $10,000 a year towards their degree will now have 20 per cent more added to it, potentially making higher education completely out of reach for some I would imagine.

The risk is that deregulation of fees will lead to an inequitable system which could lock out many students particularly obviously from lower socioeconomic backgrounds. We know that most disadvantaged people have a lower school retention and higher education success rate so this will only increase the divide potentially.

As Minister for the Status of Women I am particularly concerned that these cuts will bite more deeply into women given that the full-time workforce participation rate of female graduates starts declining in their late 20s and early 30s, obviously when many leave the paid workforce to have children. As only one of the five part-time jobs pay enough to reach the HELP payment threshold—the loan repayment system—there is a real risk that people will be faced with carrying relatively higher levels of debt for a good part of their lifetime.

Many of these women, in particular, but men also, when they leave the workforce to have children, will have this debt hanging over their head, while at the same time essential family needs have increased, and they might find it extremely difficult to access further financial support and assistance through loan arrangements if they already have a large debt hanging over their head. They might, for instance, want to put a mortgage on a car to help with family matters.

Mature-age workers will also face disincentives. When the loan repayment salary threshold was slashed in 1997-98, demand for university education for mature people fell. Many mature-age students already work and therefore have to repay their loans whilst studying, and obviously that is a great concern.

Sadly, the deregulation of universities potentially will most negatively impact women and older people, the very groups the federal government claims to be trying to retain in the workforce. As I have said in this place previously, the state government will not stand by and watch the Liberal government rip funding from our universities and other really important sectors of our society. We will continue to fight for a fair South Australia and a place where people can have good access to universities.