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Wednesday, 26 November 2003
Page: 18015


Senator RIDGEWAY (10:56 AM) —I also rise to speak on the Family and Community Services (Closure of Student Financial Supplement Scheme) Bill 2003 and the Student Assistance Amendment Bill 2003. I particularly want to explore the effect of these bills and the accompanying scheme on Indigenous higher education students and to echo the words of Senator Stott Despoja on the Democrats' position on these bills.

A number of things need to be said. The Student Financial Supplement Scheme has been flawed from the very outset. Students are encouraged, essentially, to accumulate debt on top of HECS and there is a differential treatment depending on the amount of the loan and whether the student is a dependent or independent student. In particular, there are around 4,000 individual Indigenous students who rely upon this scheme as their main source of income. I think consideration must be given to the effect of its closure, particularly in terms of income support, student access and student retention rates. Until these students are able to complete their studies—or until appropriate income support measures are put in place—it seems to me that the scheme itself should be maintained.

The background to some of this is that, less than 12 months ago, the first comprehensive report into Indigenous education was tabled in this parliament. The report served as a report card on the state of the nation when it comes to Indigenous education. Whilst I do not intend to explore the raft of depressing statistics that are compiled in the report, suffice it to say that the problems faced by Indigenous students begin at preschool and extend across the board right through to the tertiary level. In 2001, just over 7,000 Indigenous students were enrolled in higher education courses. These students accounted for 1.2 per cent of all Australian higher education students. While the number of Indigenous students in higher education did drop in 2000, there has been a steady increase in the past 10 years and this must continue if inroads are to be made in creating better and more diverse life opportunities for Indigenous people.

While increasing the number of Indigenous students is important, equally important is the need to ensure that students are well equipped and well supported in their educational pursuits. To my mind, efforts to increase the number of Indigenous people attending schools and tertiary or vocational education institutions are wasted if they are not accompanied by the appropriate infrastructure and support to enable students not only to access education but also to succeed in it. This brings me to the question of the drop-out rate of Indigenous students, particularly from high school and from tertiary education. As the minister acknowledged in his statement on Indigenous education last year, the retention rate to year 12 for Indigenous students in 2001 was 35.7 per cent—less than half the rate for non-Indigenous students, which stands at 76.2 per cent. The retention rate for Indigenous tertiary students is also far less than the rate for non-Indigenous students, and currently stands at around 59 per cent.

I have spoken to a number of Indigenous professionals in the education sector, and it is so often the case in their experience that many Indigenous people do not complete their education because of financial difficulties. Another feature of Indigenous students is that their average age is 29, which is around five years older than the average age of any other student in our higher education institutions. Being a more mature age student is likely to bring with it greater family and extended family responsibilities and community commitments. As the Bills Digest pointed out, the people who are most likely to be affected by the closure of this scheme are parents, people with disabilities, those who live in regions of low employment opportunities and students in courses with higher levels of face-to-face contact. It is for these reasons and the fact that the take-up of Abstudy loans is disproportionately high that Indigenous students are likely to be extremely disadvantaged by this particular bill.

Anecdotal evidence also suggests that Indigenous students who rely on the Student Financial Supplement Scheme do so because there are no alternatives available. The scheme's closure would result in 4,000 Indigenous students losing up to one-third of their income. So, for many Indigenous students, this scheme makes all the difference. It means that they do not have to decide whether eating or paying rent is going to be the priority for the fortnight. As I have already stated, the drop-out rate for Indigenous school-age students is already alarming. These statistics put extra pressure on students who enter tertiary study, often without formal qualifications.

It is not enough that we get Indigenous students into higher education; as I have said, there must also be a focus on outcomes. If the government prematurely abolishes this financial assistance, the retention rate statistics will only worsen, as will the success rates, as students are required to spend more and more time finding work or actually in employment to make ends meet, and less and less time devoted to furthering their education. Aboriginality itself substantially decreases the probability of being in full-time or part-time employment; let us not make any mistake about that. It makes the situation even more concerning. The Australian Vice-Chancellors Committee has also raised this issue of work commitments. It suggested that student income support needed to be reformed in a way that reduces:

... the need for students to work excessive hours and so avert the detrimental effect on academic performance of heavy work commitments promoted by economic necessity.

In the last decade, the number of Abstudy recipients has plateaued, yet the proportion of the Indigenous population attending tertiary institutions has basically doubled. This suggests to me that the participation rate has been increasing only for those not eligible for Abstudy or for those working or studying part time. This would include students who are using this particular scheme to support themselves while they are studying. The changes to Abstudy payments, eligibility criteria, means testing and travel entitlements over the years are all the more reason to ensure that this particular scheme remains in place, at least until current students no longer utilise the scheme. We need to make sure that momentum in improvements that have been made in Indigenous education is not lost.

This bill comes at a time when the outlook for Indigenous education is grim. The government initiatives contained in Our Universities: Backing Australia's Future make sure of this. I spoke about those matters yesterday in relation to the other bills. Institutions will be able to ask for up to 30 per cent more for student fees in particular courses. This could change the composition of students so that only the wealthy are able to access higher education. Given that the average income of Indigenous people is less than that of the rest of the population, this change alone is likely to have a profound effect on Indigenous students. Rising HECS debt is also a concern for all students, including Indigenous students. The department of education has recently advised that, by 2005-06, HECS debt will be nearly $12 billion. While I do not want to see students getting into further debt, I think that the early closure of this scheme, coupled with funding reforms in higher education generally, will be a further deterrent for Indigenous students to fulfil their goals.

Promoting success and increased participation in education is vital to ensure that a new generation of leaders can emerge and be nurtured. The cost of failure in this regard is the possibility that the current problems that we see in the Indigenous community of high unemployment, community violence, family breakdown and general lack of sustaining life opportunities will be compounded in generations to come. While the Student Financial Supplement Scheme is the least favoured option as a means of student income support, the scheme is everything to the 4,000 Indigenous students who currently participate in it.

A more problematic outcome than the scheme itself would be if, as a result of abolishing the scheme prematurely, a high proportion of Indigenous students were unable to continue and faced further financial hardship, and yet did not have the benefit of the opportunities that come with completing their courses. Given the obstacles that face many Indigenous students, it seems to me that this scheme should continue until the government can establish a suitable safety net or until these students complete their studies, to ensure that those 4,000 Indigenous students are encouraged to succeed and are not discouraged from furthering their education.

At the request of Senator Stott Despoja, who is dealing with these bills on behalf of the Democrats, I foreshadow that she will be moving a number of amendments to these bills at the committee stage. Amendments will be moved to introduce a sunset clause to the scheme so that, if these bills pass the Senate, those students who are currently enrolled and relying on the scheme to finish their degrees will be able to continue to access the scheme until the end of their course. We also welcome the National Union of Students support for this amendment. Senator Stott Despoja will also move an amendment to the Family and Community Services (Closure of Student Financial Supplement Scheme) Bill 2003 to extend rent assistance to Austudy recipients and an amendment to both bills to lower the age of independence. It is also the intention of Senator Stott Despoja on behalf of the Democrats to introduce further amendments to the bills to increase the rate of student income support payments to the poverty line and to increase the parental income test threshold.

To give some context to these amendments, data published recently by the Monash Centre for Population and Urban Research showed that the percentage of students under 19 who are accessing student income support has decreased markedly from 33 per cent in 1998 to 21 per cent in 2001. That data shows that students are increasingly delaying entry to university to earn money to qualify as independent students—that is, students who have been out of school at least 18 months and who have earned at least $15,990 in the 18-month period before claiming youth allowance. Between 1998 and 2001, enrolments by 21-year-olds, 22-year-olds and 23-year-olds increased by 11 per cent, 15 per cent and 12 per cent respectively, compared to only a one per cent increase in 19-year-olds. Thirty-six per cent of students under 25 were able to access Youth Allowance in 2001 compared to 21 per cent of students under 19.

These figures show the serious effects of the government's parental income test. It is inequitable that parental financial capacity is a significant determining factor for the majority of students who consider university study. The system creates perverse incentives for young people to defer studies despite government rhetoric on maximising the national skills base. This report followed on from the Australian Vice-Chancellors Committee report called Paying their way, which found that 70 per cent of students have to work more than two days a week just to survive and more than a third are missing classes due to those work commitments.

It is not surprising that the opposition are opposing these bills today, given that they introduced the scheme in 1993. However, the ALP's current policy in relation to income support also leaves a lot to be desired. Their higher education package, Aim Higher, only extended rent assistance to Austudy recipients and lowered the age of independence to 23, when clearly so much more needs to be done in this area to ensure students are not forced to live below the poverty line.

The Democrats have always advocated extending rent assistance to Austudy recipients and lowering the age of independence, and I welcome the ALP's support of these policies today. However, these should be considered as first steps towards income support payments that students can survive on, not the final destination. It is unacceptable that students should be forced to survive below the poverty line. Unfortunately, however, the government is not offering to increase student income support payments if this scheme is abolished.

To finish up, I want to echo again that since 1996 when the Howard government came into office there has been a relative decline in improvements for Indigenous people on all fronts, except for housing. In other words, while circumstances have been getting better for the rest of the nation, they have been getting far worse for Indigenous people. The higher education reform bills, combined with the closure of this particular scheme and the lack of alternative proposals being put forward by the government, compound the circumstances for Indigenous people.

There needs to be a holistic approach with what is happening out in the communities. We cannot continue talking about what may be happening within communities and feeling helpless about the lack of improvement for taxpayers' moneys. We have to say fairly and squarely when dealing with these types of reforms that they have a direct impact on life-sustaining opportunities and on the capacity of Indigenous students to access higher educational institutions and complete their studies. An important point to keep in mind is that Indigenous students are usually of a mature age and have family responsibilities and commitments within their own communities. These things need to be taken into account when determining what we do with these particular bills and the reforms that the government is putting forward.

From a personal perspective, I cannot see how these bills can be supported because they do not provide any public benefit or the safety net that is required for those who are disadvantaged and for Indigenous students—particularly the 4,000 who are yet to complete their studies. The last thing we need is to foist upon these people the opportunity to increase their debt. It is staggering that by 2006 there may be $12 billion worth of debt owed by students in this country. Should we not be working towards something that is more sustainable and realistic? Should we not be working towards something that provides benefit and builds up the skills base that the government so often talks about by putting in place initiatives that work for all and, in particular, for Indigenous people?

(Quorum formed)