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Wednesday, 11 May 1994
Page: 589


Senator BELL (11.47 a.m.) —The Australian Democrats have some fundamental problems with the Student Assistance Amendment Bill 1994, but we do support some of the overall minor changes brought forward in the package. Firstly, we support the decision to give a legislative basis to the assistance for the isolated children scheme and the Abstudy scheme. We support the indexation of the dependent spouse allowance to the CPI. Linking allowances to the CPI is something that the Democrats have supported for some time.

  We support a decrease in the amount of delegated legislation that comes before parliament. Therefore, we support further changes as have been recommended by the Standing Committee for the Scrutiny of Bills which have been mentioned by Senator Teague. In particular, we believe that the proposed new sections do not go far enough in following that theme. I will quote from a recent report of the scrutiny of bills committee which says, in part:

. . . a proper balance of the functions of primary and secondary legislation would require more content to be included in the Act.

My colleague Senator Spindler was vociferous and firm in his suggestion to the minister in a previous matter in this chamber when he said that, if it was good enough to be spoken about and intended, then it was good enough for the minister to ensure that it was included in the act. I will continue that theme by suggesting that the scrutiny of bills committee feels that way as well. We see a need to properly address that theme again in this legislation.

  It is appropriate that students involved in these schemes have access to the same grievance procedures as other Austudy recipients. Also extended, however, will be the debt management regime which will now include Aboriginal student support, parent awareness programs, the Aboriginal tutorial assistance scheme and the vocational and educational guidance for Aboriginals scheme. No wonder the government is keen to ensure that these sections are covered in a legislative framework.

  Senator Teague has mentioned something about the repayment rates, and I think I should seriously address this subject. It is important that we remember that last year when the higher education funding bill came to the Senate it was only the Australian Democrats who opposed the increased rates of repayment under the higher education contribution scheme. That is getting the money back faster for the government.

  The HECS repayment rates were increased from two, three and four per cent of taxable income to three, four and five per cent of taxable income. Coupled with this, the government reduced the income threshold—the figure at which students are expected to begin to repay their HECS debt—from $27,748 to $26,402. This is despite the fact that graduate starting salaries are now at an all-time low. This bill seeks to increase the rates of repayment by lowering the threshold for the student financial supplement, the student loans, and that is being characterised as bringing it into line. Some sort of evening-up image is being created there.

  Again, the Democrats were the only people looking out for the interests of Australian students when the loans scheme was first introduced in November 1992. We foresaw the government's efforts to increase the pace in levels of repayment, and today we see reduced that income threshold at which students begin to repay their loan. The first reduction of the threshold was insidious and immoral, and we should not accept this repetition of the same device. It is not evening up; it is a repetition of an insidious and immoral step which was taken some time ago, and of course we oppose those changes. Both the HEC and loans schemes remain a cynical revenue raising attempt by this government. It may see students repaying their debts within a shorter time frame, but it will compound the hardship and the financial pressure that graduates face during the early years of their working lives.

  The budget papers reveal that the government intends to collect $23 million from students through such euphemistically described measures as the `improved administration of Austudy personal income test', which will produce $10 million, apparently. They are the sorts of measures that this bill also collects in that sort of rake-off. Evidence gathered last year highlighted the fact that women will be the hardest hit by these debts and that many women will be repaying the debts well into their late thirties, forties and perhaps even fifties.

  Some people will carry that debt for life because it is quite simply the case that, despite having obtained tertiary qualifications, some people will not be able to achieve employment at a rate of payment which will enable them to start repayments. These people have been characterised recently by the government as poor risks or bad debts, the image being that somehow or other they have done something evil which would excuse the government taking punitive measures to recover this debt. These people have really not done anything wrong; they have simply attended a tertiary institution and not been in a position to make the contribution that is included in, again, the euphemistically entitled HEC scheme. It is perhaps better described as h-e-x, a curse, rather than H-E-C-S.

  The pressure that continues to be applied on people who are recent graduates comes at a time when people are intending to set themselves up for future employment. Whether it be loans to establish employment, housing or family life, it is unfortunate that this coincidence of debt arrives at the same time. We have not seen a proper analysis of the effects of these loans schemes on students, yet the government is happy to increase the rates at which graduates repay these debts. In last night's budget, the maximum amount students can obtain in a loan form was increased to $7,000—again, an expansion of the possible debt. Some people have characterised this as the generosity of the government. It is hardly generous; it is just enabling people to increase the burden they need to impose on themselves to complete their tertiary education.

  The government claims that these measures will make more than $5 million out of students over the next five years. The government is again financing its recovery, it would seem, at the expense of some disadvantaged people. Our amendments, which I will propose at the committee stage, will delete the relevant proposed sections, including reference to the Higher Education Funding Act 1988. These measures do not have to mirror changes in the Higher Education Funding Act; there is no legislative nexus.

  The penalty changes are also an aspect of this package which concerns us. We will strongly oppose changes to the penalty provisions. It is a cheap shot; I admit that. It is something that one would have to agree with, so we, of course, welcome the changes in this bill that decriminalise failing to notify the department of changes in circumstances. We agree with the extension of time from seven days to 14 days. One could hardly not accept those changes. But associated with them, and linked in in such a way that it is important to discriminate carefully, are clauses of the bill that deal with debt recovery and penalties for failing to notify changes that are not only draconian but legally questionable.

  I make these comments on good advice. We have sought legal advice. It is based not only on the well-referenced Senate scrutiny of bills committee that has received some accolade already in this debate, even in its early stages. It is not only that that committee has noted that the `new arrangement is a retrograde step, imposing a more onerous level of obligation on recipients under the threat of what, in the circumstances, appears to be a rather severe penalty' but I have also contacted lawyers who question the legal basis of this reversal of onus of proof. And that is what it is: a reversal of the onus—the placing of a further onus on students to be able to prove aspects of this scheme. I quote again from the scrutiny of bills committee:

The Committee can understand that an oil spill on the Great Barrier Reef or serving salmonella infected food would warrant offences of strict liability because of the serious consequences of such acts. But receiving $10 too much because some change of circumstances was not notified does not . . . warrant strict liability.

I hope that all reasonable people listening to this debate and all reasonable decision makers anywhere would agree with that. The two aspects of behaviour are so far apart from each other that people would have to agree that, on the one hand, strict liability could and should be applied but that, on the other hand, the onus of proving that a change in circumstances which results in an additional few dollars going, as they do in most of these cases, directly into a student's bank account, when this was done in an accidental fashion rather than in a conniving, contriving and guilty fashion, is an onus which is far too heavy to bear and does not warrant strict liability. There are other ways of finding out this; there are other ways of prosecuting this level of misdemeanour, which is hardly a heinous crime.

  According to the advice received by the scrutiny of bills committee, strict liability offences disregard guilty knowledge and require the accused to raise the defence. This effectively reverses the onus of proof. Not even in relation to the Department of Social Security, where overpayments total $250 million per year, has a strict liability provision been required or thought necessary. Although the Senate Committee for the Scrutiny of Bills requested the minister to reconsider the scheme, the committee did not meet with any success. So the Democrats will persevere and move amendments at the committee stage which will deal with those changes, because they are punitive and are deliberately targeting students. For those reasons we will be opposing them.

  In effect, this bill allows students to be charged with a strict liability offence for receiving as little as $10 in Austudy overpayments. It replaces a failure to notify offence with an offence of strict liability. I have really repeated what I have said, but I wanted to get it right.

  The matter of the health care cards has been raised by Senator Teague. The amendment which calls on the government to honour its promise that health care card holders would have Austudy means and assets tests waived is a good amendment. It does what ought to be done in this regard. We thought for a while that the minister was going to initiate some change independently, because last year the minister announced that those with health care cards would get Austudy without assets or income testing. But the Department of Employment, Education and Training issued a directive earlier this year reneging on the decision. I would have thought any minister would have been embarrassed by that.


Senator Boswell —He should have been, but he wasn't.


Senator BELL —I agree; a minister with any hint of morality should have been. My colleague Senator John Woodley was particularly involved in this campaign at the beginning of the year when the government first backed down on the decision. He worked hard to make sure those students who had applied under this agreement were not disadvantaged and finally were granted Austudy on that basis. Even the Austudy booklet and information kits distributed around the country contain the original ministerial decision. I quote:

From 1994 the assets test of both you and your spouse generally won't be counted if your spouse holds a health care card.

The minister has had the opportunity to change the departmental directive, to remove that, or to reprint it, but has chosen not to do so and has let down students and their families. Of course, that has applied mostly to rural families. I read from a letter from Mr Rick Farley of the National Farmers Federation:

It is obvious that the Government's decision to provide AUSTUDY to Health care card holders is very beneficial to farm families, who may have a high level of assets but a very low income.

. . . . . . . . .

. . . for the Department to impose an assets test on Health care card holders defeats the purpose of the Government's policy. Effectively, applicants with low incomes and high assets will continue to be excluded from accessing AUSTUDY and furthering their education.

That is a simple statement of the situation as it is. One could not express it any more simply.


Senator Teague —The NFF got their advice from Senator Boswell, I think.


Senator BELL —That is probably right, too. In the debate on this matter, there has been a degree of consensus between those parties who have seen the immorality of this. I am surprised that the minister has not been sufficiently embarrassed or, at least, moved to recognise the sensibility of this and to actually do something about it. In the absence of that, we commend the opposition's decision today to move the necessary amendments, and we will be supporting them.

  It is a little frustrating to be quite ready to support amendments which achieve the same results as those propositions which have repeatedly been put to the chamber by the Democrats—that is, to discount assets from the tests which apply for the provision of such benefits and, one would expect, rights to rural families. So often, the propositions have not been accepted by the opposition when the Democrats have moved them, but now we are quite willing and, I suggest, eager to recognise and support them when they appear here. Let us not stand on ceremony; we will be accepting the amendments, for the benefit of rural families, particularly.