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Wednesday, 26 November 2003
Page: 17996

Senator KIRK (9:47 AM) —I rise this morning to speak on the Family and Community Services (Closure of Student Financial Supplement Scheme) Bill 2003 and the Student Assistance Amendment Bill 2003. The Student Financial Supplement Scheme was introduced in 1993 in response to student demand for additional financial support in order to help them undertake their university studies. The scheme has the effect of providing a voluntary loan, where eligible tertiary students trade in $1 of their income support for $2 of a loan, to a maximum value of $7,000. The scheme is a recognition that battling university students cannot survive on Centrelink payments. Despite this recognition, the government announced in April of this year that the Student Financial Supplement Scheme would not be available after 2003.

In the year 2000, 40,000 students took advantage of this scheme. The government, unfortunately, is not proposing any replacement scheme or any additional financial assistance to students after its removal. The government has not offered even a glimmer of hope that it will increase student support to a liveable income. Without such a measure, this means that up to 40,000 students every year will essentially be blocked from participating in the higher education system. Vicky Kasidis, Access and Equity Officer of the Swinburne Student Union, wrote in the Swinburne student newspaper, The Swine, earlier this year:

What this means in real terms is that poor students will have less money per fortnight (most would lose at least $200.00 per fortnight) and this will drive many out of the tertiary sector altogether.

The Australian Vice-Chancellors Committee report that Senator Crossin referred to—namely, the report entitled Paying their way: a survey of Australian undergraduate university student finances released in October 2001—was the first national survey of the financial circumstances of higher education students in 10 years. It is for this reason that I will be referring quite a lot to the findings of this report. It highlights the difficulties that many of our university students find themselves in today. Most of the student comments on the surveys about the student financial supplement loan were very positive. I will read a small selection of their statements:

University loan scheme is great.

If I was not able to receive the supplementary loan I would not be able to attend uni.

Without a student loan I could not attend uni. Last year I held a part-time job all year. It ended up that I earned more money this year by only full-time employment during semester breaks. By the time uni is completed my HECS debt will be 50,000 plus.

Financial situation hard at first—hard to live out of home on Youth Allowance. Took out a student supplement loan which is easier. Still hard. I am now working two casual bar jobs to get savings, so I can buy textbooks, pay car loan and fees.

Overall, the survey provided strong evidence that the financial circumstances of undergraduate students at Australian public universities are having an impact on students' studies, to the extent that the students and the public that fund universities are not gaining optimum value for their enrolment. The survey was extremely broad in its reach, with 19 of our 37 public universities participating and a total of 34,752 student replies being received. A huge number of students responded to the survey; therefore, I think it is fair to say that the survey is quite representative of students' views. The survey found:

Government income-support programs are very important in allowing less financially-advantaged students to continue studying, but many concerns were expressed that the level of income support is too low and that access to the schemes is too restrictive. Austudy recipients are disadvantaged compared with Youth Allowance recipients because they are not eligible for `rent assistance'. Because of the way in which the programs are structured, Youth Allowance and Austudy recipients have a strong financial disincentive to work more than about a day a week on average throughout the year. The total income from income support and limited part-time work, combined with educational expenses, leaves participants in these programs financially vulnerable.

In light of the findings of this survey conducted by the Australian Vice-Chancellors Committee and by reason of the information that Labor has before it, Labor will oppose the abolition of the Student Financial Supplement Scheme, as it is one avenue by which such students can choose to increase their day-to-day income. Without any additional measures to increase student income we will only see more of our bright and talented, yet disadvantaged, young people pushed out of higher education, out of the wealth of opportunity that an Australian education offers—but, increasingly under this government, only to a select few.

Rent assistance is a supplement to youth allowance, based on the amount of rent a student pays, and can be a significant supplement to a student's income. That this extra funding is not available to older students we consider to be blatantly unfair and inequitable. Labor will move amendments to make rent assistance accessible to Austudy recipients—a move that would provide up to $90 extra per fortnight to more than 15,000 Australian students. This amount would make an enormous difference to the ability of many students to study and to buy their textbooks and associated materials.

A further Labor amendment to this bill would progressively lower the age at which students become independent and at which the means test on parental income for youth allowance cuts out, to age 24 in 2005 and to age 23 in 2007. Both amendments give effect to aspects of Labor's policy on higher education and learning, known as Aim Higher. If the government does not make more income support available for students, we will only see an exacerbation of the already worrying trends identified by the AVCC report Paying their way. In this report, choice of course, university and mode of study were strongly linked to financial circumstances. A far greater proportion of part-time students, 47 per cent, than full-time students, 15.9 per cent, reported that financial circumstances affected their choice of mode of study—that is, many students would prefer to study full-time, but are simply unable to afford to do so.

This issue ties in with one of the major findings of the AVCC report: that seven in every 10 students are in paid employment during university semesters—an increase by about one-half since 1984, less than 20 years ago. In addition, among full-time students, the average number of hours worked by those in paid employment during semester is 14.5 hours per week—a three-fold increase on the 1984 survey result. It is now the norm to work and study while at university, despite the fact that most courses recommend to their students that significant work hours combined with full-time study will impinge on their ability to successfully complete the course.

Many students regularly miss classes due to work commitments. Many more report that work adversely affects their study `a great deal'. I know of one young man who has repeatedly enrolled at the beginning of the year in his marine biology course, only to repeatedly withdraw later in the semester because 9 a.m. starts at university are simply incompatible with his part-time job working night shift at a service station. Restricted access to financial support means that he effectively has no other option but to withdraw from his university studies.

As a former lecturer in law at the University of Adelaide, I know from personal experience that the financial pressures on students are significantly contributing to a culture of mediocrity within our universities. Bright students that I have come across can do only the bare minimum, and average students often fail because of inadequate income support. Many of them work significant hours just to remain financially viable, hours that cut significantly into what realistically should be time devoted to their studies.

The government, by introducing this bill to abolish the Student Financial Supplement Scheme, has revealed how out of touch it is with university students. This government clearly has no comprehension of the extent of student poverty. Currently, maximum payments are 20 per cent below the poverty line for students on youth allowance and 39 per cent below the poverty line for students on Austudy. There are students, struggling on their full rate of youth allowance—around $300 per fortnight, which must cover rent, food and study costs—who, at the end of the fortnight, simply cannot afford the bus ticket to get to their class. Others cannot afford to photocopy their required readings and other essential materials, much less have any chance of purchasing expensive text books.

The AVCC report found that one in every 10 students misses classes `sometimes' or `frequently' because they cannot afford travel to university. The ability to increase your immediate income by up to $3,500 per year or $135 per fortnight, without affecting your study, as offered by the Student Financial Supplement Scheme that we are considering here today and that this legislation proposes to abolish, is a most attractive option for many students. Unfortunately, this is an option that the government is attempting to remove from Australian university students. A student letter to the President of the National Union of Students stated:

The loan allows students to make their own choices as to the level of the loan and therefore the level of their debt and repayments. Centrelink payments are unlikely, even with increases, to give such individual flexibility.

There needs to be an awareness that there are times when unforeseen expenses validate the need to access extra financial assistance. While students may feel their backs are against the wall, study and starve for the present or cope now and owe big time later, at least a loan system at best recognises the importance of choice and personal responsibility.

The government should be increasing options for students to manage their study and living costs, not turning up financial pressure on students. Since it came to office, the government has slashed university funding by more than $3 billion, while we have seen student contributions to the cost of their education increasing by 85 per cent. Over the past decade, universities have continued to attempt to provide quality education to Australian students. They have continued to research and provide professional training, while fiscal constraints have tightened. Academics find themselves being asked to work longer hours and to take on a greater teaching load with larger classes, and all the while to continue to research, preferably in an area that will provide either prestige or, even better, revenue for the university. This government has stated its vision for the future of Australia's university sector. Its vision is one that would see an end to equal access to education through a system that is based more on ability to pay than on merit.

The hypocrisy of the government is abundantly clear in its attempt to get rid of the Student Financial Supplement Scheme. The premise is `student debt' while at the same time it proposes to shift the cost burden for education even further onto students with the policy of the Backing Australia's Future package. Under the legislation before the Senate today, on which I spoke yesterday, significant changes are sought to be introduced into the university sector. They were covered by other speakers and by me yesterday but, to summarise, universities will be able to increase student fees by 30 per cent, which will see full fees of up to $150,000 for undergraduate studies in some instances. This will be the reality for double the current number of Australian students. In order to pay these extra fees, students will have to take out loans and pay up to six per cent interest. For the first time, students will be forced to pay real levels of interest that will compound year after year in the crucial early years of their working life. The reality of policies like these is that fewer students, many of them among our best and brightest, will be able to make the investment of pursuing a university education. This is and should be a matter of concern for all Australians. The raft of reforms announced by the government could well price many of those who want an education out of the market.

By contrast, Labor's plan, Aim Higher: Learning, training and better jobs for more Australians, in its entirety, articulates a very different future for higher education in Australia. I do not have the opportunity to fully articulate the detail of the policy here but, in brief, Labor will oppose outright the deregulation of university fees and abolish full fees for Australian undergraduates, and it will abolish the government's real interest rate student loans. The Australian Labor Party is committed to an affordable education for all Australians and to university entry that is decided not on your ability to pay but on your ability to undertake the course. The retention of the Student Financial Supplement Scheme and Labor's further amendments to the bill, as part of our plan for higher education, will ensure that education remains accessible for everyone. I urge honourable senators to support Labor's amendments to the bills.