PM urged to back global HECS program to prevent Asia-Pacific ‘youth unemployment bomb’

Anthony Albanese has been urged to back a global HECS-style system across the Asia-Pacific to avoid a ticking youth unemployment bomb.

Foreign Minister Penny Wong and assistant minister Matt Thistlethwaite during their post-election blitz of Fiji, Tonga and Vanuatu in May. Picture: Daniel Walding

You can now listen to The Australian's articles. Give us your feedback.

You can now listen to The Australian's articles.

Anthony Albanese has been urged to back a global HECS-style system across the Asia-Pacific region, amid warnings from Australia’s biggest overseas aid organisation over a ticking youth unemployment bomb that will “arrive on our shores sooner or later”.

As countries across the globe rein in spending on foreign aid and shift funding to defence, World ­Vision Australia chief executive Daniel Wordsworth has revealed the charity group is developing a pilot global HECS program targeting multiple countries.

Amid concerns about the movement of economic migrants across the Indo-Pacific and potential impacts on Australia’s border security, Mr Wordsworth said it was time for action to educate, train and provide jobs pathways for young people in the region.

Writing for The Australian, Mr Wordsworth said “in the next five years, the greatest risk to regional stability in the Asia-Pacific won’t be warships or cyber hacks … it will be something far simpler, more ­silent – and more explosive: youth unemployment”.

World Vision Australia chief executive Daniel Wordsworth.

“From Indonesia to Solomon Islands, millions of young people are stepping into labour markets that have no room for them. These are not future problems. They are present realities. And they are already warping the region’s economic, social and political trajectory,” Mr Wordsworth writes.

“By 2030, over 1.4 billion young adults – more than half of them in Asia and Africa – will be vying for their first job. But in places like Timor-Leste, Papua New Guinea and Cambodia, the economy ­simply can’t absorb them. In PNG alone, the World Bank estimates that up to 80 per cent of youth are underemployed or engaged in informal work only.

“If we tackle this problem successfully, we unlock a demographic dividend and turbocharge regional development. If we get it wrong, we risk a generation trapped in poverty, disillusionment and unrest.

“The youth bulge could become a youth bomb, one that will arrive on our shores sooner or later.”

As China aggressively expands its footprint and influence in the Indo-Pacific region, successive Australian governments have moved to expand employment opportunities for workers in South Pacific nations. Foreign Affairs Minister Penny Wong last month launched a post-election blitz of key Pacific nations including Fiji, Tonga and Vanuatu.

Mr Wordsworth said it was time to tap potential across the ­region and the fix should channel “an Australian success story, hiding in plain sight: HECS”.

“What if Australia helped pioneer a global HECS for our region – an income-contingent loan system adapted for low-income and fragile economies? A version that works through mobile payments, kicks in only when a graduate earns above a threshold, and targets the exact skills local employers can’t find?” he writes.

“It’s not a fantasy. It’s already happening. Rwanda has trialled it. Colombia restructured its loans this way. South Korea built a world-class university system on the same model. World Vision is working with partners to develop a pilot global HECS program.”

The World Vision chief said a global HECS program would deliver on three fronts: security, economics and diplomacy.

“A global HECS is less moonshot, more Ikea flatpack: the parts exist, the manual is written, we just need the will to assemble it. We spend billions on regional stability, defence co-operation and infrastructure aid, but none of that will hold if the region’s young people are locked out of prosperity.”

“Australia faces a choice. We can be the nation that once solved a problem for ourselves – or one that scaled that solution to benefit millions. We can let the Asia-­Pacific’s youth bomb tick louder each year, or defuse it with the best tool we’ve already got. We built HECS. The world needs it. And now, our region is asking for it.”