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Wednesday, 9 October 1991
Page: 1535

Mr GIBSON —-Can the Minister for Higher Education and Employment Services advise the House of the current state of student finances? Is the Minister aware of any threats to students' living standards while they are studying? What are the Government's intentions on this matter?

Mr BALDWIN —-I advise the honourable member for Moreton that Commonwealth payments for student assistance have nearly trebled in real terms over the past six years. They are up 178 per cent, due essentially to three factors. Firstly, there have been increases in the real rate of benefit, with the maximum benefit for age 18-plus students living away from home up 13 per cent in real terms since 1986. The maximum benefit for a secondary student living at home is up 30 per cent in real terms since 1986. The second factor is the increased numbers, with higher participation and higher education in senior secondary schools and extensions of eligibility in secondary schools. Recipient numbers have more than doubled in the last six years. On an earlier occasion I described the set of measures that we announced in this year's Budget to produce a more equitable, more flexible and more broadly accessible scheme. These changes have been welcomed by student organisations and the Government now has a consultant looking at broader issues to do with the structure of student income support.

In the second part of the honourable member's question he asked about potential threats to the position of students. Quite frankly, there are some very serious threats on the horizon--particularly those coming from the Opposition. If the Opposition spokesperson on education matters, the honourable member for Goldstein--also known as Count Yorga, vampire, because of the way he wants to get his fangs into student finances--is able to carry out those threats, students are facing a grim situation indeed. We are talking about an Opposition that is looking for $3 billion in expenditure cuts. How will that be achieved without eating into student finances?

Frankly, we have not seen anything of significance from the honourable member for Goldstein about what the Opposition proposes to do on student income support. The only statement of any substance that we have heard thus far has been from the honourable member for La Trobe, whose proposal was to abolish all classes of secondary Austudy and to convert tertiary Austudy into a loan scheme. It is pretty grim, but it would be even worse for the higher education sector as a whole if this proposal floating around in certain circles for a goods and services tax were to be implemented.

Were that to be done, of course, the higher education sector would be slugged in three ways. First, the Opposition has made it perfectly clear that it is on about a proliferation of the full fee paying arrangements. Of course, if a goods and services tax is applied to that and one is looking at something of the order of $12,000 average per annum in student fees--and if those charged to overseas students are anything to go by, one is looking at $12,000 on average--that works out at about $1,800. That is the first respect.

The second respect would be the impact on higher education institutions themselves. They are, of course, currently exempted from sales tax under the sales tax legislation. Something of the order of $1.4 billion a year is spent by higher education institutions on goods and services which would be potentially subject to this goods and services tax. If it were levied at 15 per cent, one would be looking at an impost on higher education institutions per annum of $210m. If it were levied at a rate of 22 per cent, one would be looking at $310m. What does the honourable member for Goldstein have to say about this massive financial impost on institutions and on students?

Finally, I turn to how the goods and services tax would impact on students in a direct sense. We do have some information on the pattern of student expenditure as result of surveys done by the National Union of Students and also by the Department of Employment, Education and Training. We know that an average student spends around $3,200 on accommodation and food--not taxed at the moment. Under a 15 per cent coalition consumption tax, there would be a tax of $480 per annum paid on that; and at 22 per cent, it would be $704. The average student spends around $850 on course related costs, particularly books, not currently subject to tax. Under a 15 per cent tax, one will be looking at $125; under a 22 per cent tax, one will be looking at $187.

I have a typical university textbook named Foundations for Australian Political Analysis: Politics and Authority by one D. A. Kemp. The retail price is $32.50. Every student unfortunate enough to be in a course for which this book is a prescribed text will be liable to pay $4.88 on top of that $32.50. It might not be a particularly good example: one may be able to pick it up in a remainder bookshop for a buck!

The average student spends around $1,550 on transport costs, including bus and train fares. Fifteen per cent tax levied on that is $230; 22 per cent tax on that is $340. This is a total pattern of a three-way slugging of the higher education sector: an attack on student living standards, an attack on the quality of provision of higher education and an attack on higher education finance.

Mr Tim Fischer —-Mr Acting Speaker, on a point of order, this Minister is now way out of the ambit of the question. He has covered just about everything but his opposition to the third runway at Mascot against the Cabinet decision. As such, he should be brought back to a conclusion or he should resign.

Mr ACTING SPEAKER —-There is no point of order. However, I would observe that the Minister should conclude his answer.

Mr BALDWIN —-In conclusion, all things considered, students would suffer disastrously under an Opposition government. It would be a case not so much of cuts but rather of puncture marks draining the lifeblood out of student finances. If the Opposition were able to win government, the only potential winners--and they would persevere in this vein--would be those with the foresight and the financial wherewithal to invest in wooden stake or garlic futures.