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Wednesday, 17 March 2010
Page: 2026

Senator MASON (9:55 AM) —The coalition in principle supports efforts to improve the ways in which assistance to students is targeted. The government is very right to do that. We have never had problems with the bulk of changes in the Social Security and Other Legislation Amendment (Income Support for Students) Bill 2009 [No. 2] that is before us today, such as the introduction of new scholarships and most of the changes to youth allowance, but we have major problems with two aspects of the bill: firstly, its retrospective impact on students who have already made decisions affecting their lives, work and education based on the law as it previously stood and, secondly, the attempt to narrow the avenues to achieving independence by workforce participation for the purposes of receiving youth allowance. We thought that the changes proposed by the government would unfairly impact on students from remote, rural and regional areas by making it more difficult for them to qualify for youth allowance and thus pursue their further education.

The coalition also maintained that it was wrong of the government to put in the same bill the non-contentious reforms, such as the new scholarships, and the more controversial changes, such as the one I mentioned before. This was bound to be a recipe for trouble, and we were proven right. It has taken us from mid-May last year until mid-March this year to arrive at a position where we can debate and pass this bill. But arrive at that point we finally have.

The bill currently before the Senate represents the result of negotiations undertaken between the government and the coalition. It embodies what I believe is the best deal achievable by all of the parties under the circumstances. This is not to say that this is the best deal that could be. We believe that the government should have been more generous to rural students, and as such I foreshadow that in the committee stage I will move an amendment which will reflect the coalition’s view of what a better outcome for rural students would be.

The nature of any compromise is that neither side gets everything they want but at least both sides get some of what they want. This is the case here. The government gets the bulk of its reforms through, most of which, I remind the chamber once again, the coalition actually never opposed. The issue of retrospectivity is now resolved and the workforce participation path to independence has been preserved for many rural students who would otherwise have missed out if the original version of this bill had been allowed to pass. But, as I said, the coalition believes that even more should be done.

The Minister for Education and Deputy Prime Minister, Ms Gillard, has made much of the government’s intention, in response to the Bradley review, to both increase the overall participation in higher education by young Australians and increase the access and participation by young Australians from groups in our society who are currently underrepresented at our universities. The government is right to do this, and the coalition supports this aim as it is a noble one. There is no question that Indigenous students and students from low socioeconomic backgrounds are disadvantaged when it comes to accessing university. With that, the coalition has no quibble. There is no debate about that. But what we have argued and we make no apology for is this: not only are those two groups affected and disadvantaged with respect to access but so too are rural kids in this country.

As we now know from Senate inquiries and other inquiries, university access by rural kids is falling. It is getting worse. It is getting more difficult. So what the coalition has been fighting for for 18 months now is a better deal for those disadvantaged Australians. It is quite right for the government to talk about Indigenous kids and kids from low socioeconomic backgrounds but it is also right for the coalition to talk about another disadvantaged group, and that is kids from rural Australia. We make no apologies for that. That is why we would never back down on the major premise of our argument: that these kids need extra support.

In this instance, while the coalition supports restructuring student support measures in broad terms, we have always maintained that changes proposed by the government to the youth allowance regime were too restrictive and would impact on too many rural students and make it impossible or significantly more difficult for them to pursue higher education away from home. In particular, we have argued that the abolition of two out of three workforce participation routes for youth allowance eligibility as an independent would make it harder for many young people from rural and regional communities to go to university. Young people in rural and regional Australia have to move to the city if they are to pursue further study and are not necessarily able to rely on financial support from their parents even if their parents’ income or assets mean that they are ineligible for youth allowance under the parental means test. When it comes to rural kids going to university the challenges are different. I caught a bus to university. If you live in outback Queensland, my home state, you cannot do that, so the challenges are quite different for rural and regional kids, and that has been the coalition’s argument from the beginning.

Because this significant cohort of students from the country is ineligible to receive dependent youth allowance, thousands every year currently gain eligibility for independent youth allowance under the workforce participation criteria. This means that they have to earn about $19½ thousand within an 18-month period, which most do during the so-called gap year. This government was seeking to abolish this pathway because it was allegedly rorted by some families and students.

The government are right to attack this. When I was at university—and it is a long time ago—this system was being rorted and the government are quite right to attack those rorts. The opposition supports them in doing that. The problem of occasional abuse of the system might be solved but only at the cost of serious disadvantage to many more innocent students and, indeed, rural students. That was our problem. There was mischief and the government tried to counter that—fair enough—but the solution, in a sense, was difficult, caused many problems and disadvantaged rural students.

The Senate rural affairs committee, chaired by my good friend Senator Nash, which looked last year at the question of access to education by rural students, clearly disagreed with the government’s approach and recommended against closing altogether the two out of three workforce participation avenues as planned by the government. Even the Victorian parliament’s Education and Training Committee, chaired by Labor member Jeff Howard and with an effective Labor majority, unanimously agreed, saying:

... the Committee believes that the removal of the main workforce participation route will have a disastrous effect on young people in rural and regional areas.

And that comes from the Australian Labor Party. The truth of the matter is that you cannot increase access to higher education by underrepresented groups, such as rural kids, by putting obstacles in the way of those students accessing higher education.

As a result of the compromise reached between the government and the opposition, the amended version of this bill will keep the existing second and third workforce participation routes—that is, firstly, students who worked part-time for at least 15 hours a week for at least two years since leaving school or, secondly, students who have been out of school for at least 18 months and have earned at least 75 per cent of the maximum rate of pay under wage level A of the Australian Pay and Classification Scale, which is about $19½ thousand in 2009 over an 18-month period. It is open to students whose family home is located in a very remote, remote or outer regional area as defined by the Australian Standard Geographical Classification, ASGC, and the following conditions that also apply: the young person is required to live away from the family home to study and the combined parental income for the relevant tax year does not exceed $150,000.

Financial responsibility was always a big consideration for the coalition and we always wanted to ensure that any changes proposed by us would be budget neutral. The estimated cost to the youth allowance package as a result of the agreement between the government and the coalition is about $104 million over the estimates period ending 2013-14. To fund this it will be necessary to reduce the value of the Student Start-up Scholarships to $1,300 in 2010 and $2,115 in 2011 and subsequent years, indexed from 2011. This provides savings of about $102.8 million over the estimates period ending 2013-14.

The coalition believe that, while this is a good start and goes some way towards addressing our concerns about access by rural students, more should be done. I concede that there are anomalies. Every time you have a map and you mark a line on a map there will be anomalies and inconsistencies. When I was in the gymnasium this morning my good friend the member for Hinkler, Mr Neville, was talking about some of those anomalies. I concede, and I am sure that the government would concede, that no matter what system you have there will always be anomalies. But, to partly ameliorate that, I intend to move on behalf of the coalition an amendment that will seek to preserve the second and the third workforce participation routes for students in inner regional areas as defined by the ASGC.

I am also happy to say that the other issue which troubled the coalition about this bill, that of retrospectivity, has also been finally resolved. Under the bill as it was originally proposed by the government, many students around Australia would have found themselves in a very difficult situation. Essentially, the law was being changed midstream and the government would have left thousands of students floundering.

This was an issue of equity as well. It was an issue of equity because, in making their decisions about their studies, many students around Australia relied on the information provided to them by teachers, counsellors and Centrelink officials. They, in good faith, made their decisions about their future appropriately, based on the official advice that they received. The government was attempting to change the rules halfway through the game, and that is not fair. The basic principles of the rule of law demand that legislation not be made retrospective and thus disadvantage people who have done nothing wrong but have merely followed the law as it was originally stated. The basic principles of decency demand that the people currently in the system be allowed to proceed and that any changes be introduced only with the future in mind and not affect any current students.

I am glad to see that the government has made amendments to the bill to keep the existing workforce participation rules for students until 1 July 2010, which removes all retrospectivity from the bill. I also welcome other changes to the original bill that came about through intervention by Senator Xenophon and the Australian Greens—namely, the establishment of a Rural Tertiary Hardship Fund, worth $20 million. The government has already agreed to the creation of a rural and regional task force should the legislation pass. This task force will consider how the $20 million fund could be delivered, from 2011, to help prevent the barriers to rural and regional students attending university.

As I stated at the outset, the coalition broadly support the bill but could not do it wholeheartedly until our valid concerns regarding retrospectivity and access for rural and regional students were considered and addressed. They have been partly addressed. I believe that the agreement achieved with the government makes for a better deal for rural students than they would have received under the original, unamended bill. But, as I have said, it is not an optimal outcome. That is why I will be seeking a further amendment to extend the scope for students who can achieve independence through workforce participation. This is an issue that the coalition take very seriously and we intend to revisit it and make it right when we are back in government.

I do not do this very often in the Senate, but I would like to thank some people. This has been a long—some might even describe it as tortuous—process of negotiation with the government. I would like to thank my National Party friend Senator Nash and my Liberal colleagues in rural seats for their ardent and consistent advocacy for rural students. I thank Senator Fielding, who I know will contribute to the debate later, for his counsel on these issues and unwavering support for rural students. I would also like to thank Senator Hanson-Young and the Greens, and Senator Xenophon, for playing, I think, a constructive role in this debate. I should thank Mr Pyne and Ms Gillard and, indeed, their advisers for sitting down and negotiating in a robust way and also in very good spirits. So I thank Ms Gillard and her staff, and Mr Pyne and his staff. Finally, I should thank Senator Carr, who, as always, despite his robustness in the chamber, is a delight to deal with outside.