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Wednesday, 19 May 1993
Page: 819

Senator HARRADINE (11.50 a.m.) —I would like to congratulate Senator Sowada for having moved this motion to disallow section 51 of the Austudy regulations. The motion seeks to redress an injustice; to redress a blatant discrimination perpetrated by this Government and supported by the Opposition against large families, particularly—I notice Senator Panizza is in the chamber—those large families from the bush. Senator Sowada is trying to redress that injustice and discrimination. What the Minister for Veterans' Affairs (Senator Faulkner), who was previously at the table, said has virtually nothing to do with what Senator Sowada advanced for the disallowance of section 51 of the Austudy regulations, which says:

Living allowance is not payable to a student whose entitlement for the year . . . is less than $1,000, unless the student is properly receiving financial supplement under Part 4A of the Act.

That is $20 a week. So the Government is trying to cut down on those who are in receipt of $20 a week or less. As Senator Sowada said—and as I said last year in debates in this chamber on these matters—that means a lot to families with three, four and five students. It particularly means a lot to families in the bush with three, four or five students because, once we cut out the $20 a week or whatever it is, they are then no longer eligible for the incidentals, including the support for return visits to home each year. That is also scrapped by this regulation. So it is a double whammy against families with a number of sons and daughters who are students and, incidentally, who have to go away from home into the cities to attend tertiary or secondary educational institutions.

  I am very surprised to hear that the only response by the Opposition to this question is that it will not deter those families from sending their sons and daughters to tertiary or secondary education. That is just one point. But it is not the essential point. The essential point is a matter of pure and simple tax equity. It would be a different matter if families were able to claim a tax deduction for the money that is expended on the education of their children. But they are not entitled to claim that. Up to 1976 we were able to claim a tax deduction for the education of our children. That is no longer the case. It is extraordinary that it is no longer the case since recent developments in economic theory have emphasised the importance of investing in human capital. Australia needs to not only invest in creating future workers but also ensure that they are trained and skilled to match the best world standards.

  We hear it repeatedly stated by Government members, over and over again, that one of the best ways of overcoming the drastic unemployment problem with which Australia is faced is to invest in human capital and the education and training of our young people. But when we try to do that, we find no taxation recognition of expenditure on education at all—none. That is an injustice. Unfortunately, the major expenses undertaken by parents in meeting the educational costs of their children are not recognised by the tax system. Businesses and businessmen can claim deductions for attending all sorts of seminars of more of less educational merit, but ordinary workers get absolutely nothing for the out-of-pocket expenses of educating their children. This injustice suffered by families because the taxation system will not recognise their educational expenses, needs to be placed on the priority list for consideration by the Government in this forthcoming Budget session.

  I come back to the point which I have made more stridently in recent times and that is the injustice of failing to acknowledge for taxation purposes the fact that an income is shared by a large number of people in a family where there are three, four, five or six children. I am not making any pleas so far as I concerned because I am not involved in Austudy at all. However, we need to look at the effects of the regulation which Senator Sowada has moved to disallow and the regulation which was introduced last year to change the sibling concession.

  Let us take the situation of a farmer in the bush who has three children at university. The family income is $36,000 a year. What would happen if that farmer tried to earn an additional few dollars by pulling petrol or beer at the local servo? For every extra dollar earned, the children would lose 75c in their Austudy allowance, and the farmer would have to pay tax on the extra income. If his income were $36,000, he would be taxed at 46 per cent. He would have to pay 46c for every extra dollar he earns, plus 1.4 per cent of his income for the Medicare levy. For every extra dollar he earned, his children would lose about $1.25 in Austudy payments. There is not much merit in that, is there?

  What sort of justice is there in the regulations when that situation exists? People ought to have a good, hard look at what they are doing in this particular area. The reason why students lose 75c for every dollar earned is because of the change to the sibling concession. Honourable senators would remember that last year I moved for the disallowance of that concession. I was supported very strongly by Senator Sowada. The unfairness of that situation has gone over the heads of both government and coalition members.

  Here we have a situation where 38,000 students are going to be affected. Those students are mainly from middle income, large family groups who are struggling to make ends meet. They are the ones who are battling. They are the ones who are paying their way. These people are the new poor. They sometimes have to rely on the St Vincent de Paul Society or the Salvation Army for help. Very often they are temporarily strapped for cash for a year or two because of their overcommitment to mortgage repayments and various other commitments. This is another attack on those families. It is a ludicrous situation. The Government is saying, `$20 is not much. It doesn't mean anything.' It means a heck of a lot to these people.

  In the case of a family with four children in tertiary or secondary institutions each being entitled to $999 per year—just below $20 a week—what is the overall effect of this regulation?

Senator Panizza —Four grand.

Senator HARRADINE —That family would lose almost $4,000—barring $4. Is that fair? It is a disgrace. I suggest to the new shadow spokesman for education, employment and training, Dr Kemp, and—

Senator Teague —Dr Wooldridge.

Senator HARRADINE —I am sorry, Dr Wooldridge—

Senator Sowada —And Kevin Andrews.

Senator HARRADINE —And Kevin Andrews that they should have a very good look at this. The horse is almost bolting. I would be prepared to move that this debate be adjourned so that they can have a look at this regulation. I seek leave to continue my remarks later.

  Leave granted; debate adjourned.