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Wednesday, 2 April 1980
Page: 1393


Senator BUTTON (Victoria) - I move:

That the Senate take note of the Report on the Operation of the Student Assistance Act in 1978, tabled in the Senate on 18 October 1979.

Perhaps at the beginning of my remarks I should explain what the report on the operation of the Student Assistance Act in 1978 dealt with and also the functions of the Act. This report, which is now two years old, discusses the history of the Student Assistance Act and analyses the terms of the Act generally. It makes the following claim:

The Act . . . provides a framework within which Government assistance to students can be modified and adapted to take account of the changing needs of students and changes in the educational scene.

The burden of my remarks will be to make the point that that is a very charitable description of the Student Assistance Act. Certainly one of the things it does not do is take account of changes in the needs of students and changes in the educational scene.

The report outlines what this means in relation to the three main student assistance schemes which provide financial assistance to students pursuant to the Commonwealth constitutional power. There are three elements of the scheme designed to assist tertiary students: Firstly, the scholarship scheme, which has now been discontinued; secondly, the tertiary education scheme, which is predominantly directed to university students and students at colleges of advanced education; and, thirdly, postgraduate award students, who are the recipients of Commonwealth postgraduate awards for research studies. The many problems associated with the Tertiary Education Assistance Scheme and the postgraduate awards indicate why the Act does not provide for the changing needs of students.

I suppose that in speaking to a General Business item in the Senate on a quiet night one can say some things about the student Tertiary Education Assistance Scheme which one might not necessarily say in a more considered statement. I think that I should make one general personal observation about the Tertiary Education Assistance Scheme. I make it in a bipartisan sense. The Labor Government introduced the scheme and the present Government has continued it. The present Government publishes reports which state that the scheme caters for the changing needs of students and so on. I note that Senator Jessop is smiling. He can wipe the smile off his face. We are both locked into this situation, not just me. One can say that probably there is a need in 1 980 for a whole reconsideration of the philosophical assumptions underlying a scheme which was introduced in 1973. When the scheme was first introduced it was said that it was assumed that parents would make a contribution towards their children's tertiary studies.


Senator Jessop - That is not a bad idea.


Senator BUTTON - It is not a bad idea if people have the money.


Senator Jessop - My father did not have the money but he still found it.


Senator BUTTON - I understand what the honourable senator is saying.


Senator Jessop - He made some sacrifices.


Senator BUTTON - I always get upset by the interjections of this optometrist of great vision. I am reminded of the biblical injunction 'optometrist heal thyself. Senator Jessop 's vision of the Tertiary Education Assistance Scheme is a bit limited.

I really want to develop a serious point about this scheme. First of all, many parents are not in a financial position to assist their children's tertiary education. The scheme is, of course, designed to cater for those parents and to provide full benefits for their children. The more serious point I was trying to make was really a social one. In seven years I think we have become aware of very significant changes in the attitude of young people who would be expected to be beneficiaries of parental assistance and so on. Although such an attitude may be a great virtue in young people, many of them do not want assistance from their parents. They want to be independent of their parents at an earlier age than did people even a decade or so ago. I think that the Tertiary Education Assistance Scheme should take account of that interesting and important phenomenon. All sorts of restrictions are imposed under the scheme including restrictions on when one is eligible for benefit, whom one is allowed to live with and things of that kind which are perhaps in a sense out of date in relation to the social aspirations of many young people. I will come back to that point.

This Act and the report on the Act do not provide for the changing needs of students. I will illustrate that by referring to what I regard as four very important anomalies associated with the Tertiary Education Assistance Scheme. Before doing so, I refer to the general level of the award applicable to the person whose parents are of such insufficient means that they attract the full allowance payable under the award, which is $45.10 a week. I make the comment, which has been made here often enough, that that is an inadequate allowance for a student in that situation to live on. There have been a number of very carefully documented surveys which illustrate that point. When one considers that the level of the dole payments is more than $8 higher than that one sees the TEAS allowance in some perspective. I suppose parents are supposed to make up the difference in that area. I say to Senator Jessop that in some circumstances, they may not be able to.

The level of allowance is important. The group eligible for it, because of the means test cut-off point, is smaller than it ought to be. The present level places a squeeze on a group of parents in the community. There are a variety of other anomalous situations to which I wish to refer. I shall refer to the four most important anomalies in the operation of the students assistance scheme. The first is that relating to independent status regulations. The scheme has a number of regulations which define when a student is independent of his parents for the purpose of obtaining independent status and qualifying for the allowance. To be independent of his parents, for the purpose of attracting the allowance, a student must be 25 years of age. That is the point I tried to make a minute ago. There are many people much younger than that who. for a variety of reasons, have independence thrust upon them or who are desirous of being totally independent of their parents. That creates a number of social problems of some significance which are associated with social aspirations.

A student can be deemed to State, independent by being an orphan, a ward of the State, by being married, or having been married or having lived in a de facto relationship for two years continuously- one year if the student has children. Alternatively a student must have been employed full time for periods totalling at least two years in the previous five years. So if a student wants to be independent and attract the allowance he must be 25 years of age, an orphan, a ward of the State, married for a short period but he must have lived in a de facto relationship for two years, or one year if he or she has a child- or have been employed for two years. Often people cannot easily do this under the present Government's policies. So one of these criteria must be fulfilled before a student can gain independent status.

Let me point to some of the anomalies in this system. The fact that a student must be 25 years of age or older assumes, often incorrectly, that parents who can afford to support their children as students will in fact support them. I say without fear of contradiction that there are very many instances of that situation not applying. Sometimes it is not a question of the child wanting to be independent of his parents, but of the parents saying: 'Look, wc have got you through your Higher School Certificate. You are out now. You are on your own'. That situation often occurs. It means that the child is not considered to be independent, although he may have been able to obtain support from his parents who could have afforded to support him. Often students are forced to be independent and because they receive neither parental nor government support they cannot undertake full time study as the scheme provides for.

I refer to another criterion- that of being married. I have already mentioned that people in a de facto relationship are discriminated against by the scheme. A student who lives in a de facto relationship must live with his or her partner for two years continuously or have children. On the other hand married couples automatically receive TEAS allowances. I do not have any evidence or statistics on this, but if one took out statistics about the number of students under the age of 25 who were living in de facto relationships and the number of married students, I think it would be line ball which group constitutes the biggest class in 1980.

That reflects a social change which has taken place in the last 10 or 20 years. Twenty years ago that piece of legislation would have been appropriate in terms of what it was intended to do because the number of students who lived in de facto relationships before the development of the contraceptive pill was very small indeed. That is an extraordinary discrimination to find in legislation of this kind in 1980. The consequence is that many students are said- I believe this to be the case- to marry simply so that they can gain the full allowance under the Tertiary Education Assistance Scheme. That would seem to me to be a bizarre, unusual motive for getting married which in many instances might lead to the State being called upon at a later stage of those persons' lives to provide assistance of another kind under the provisions of the Family Law Act. The fifth criterion I referred to relates to employment. It makes no allowance for students who have been truly independent but who have been employed for the previous two years. Nor does it make any allowance for those students who have been independent for less than two years. Such stringent conditions often force young people to remain dependent on parents, which is not necessarily a desirable situation for them or the parents.

I refer to the second important anomaly which is dealt with in the report. It relates to the question of parents' income. The report points out that the means test is normally applied to the income of the students ' parents. A number of problems are associated with this. Often parents will not support their children until they are 25 years of age. That is not surprising. The means test, which is applied to parents ' income to determine the rate at which a student will be paid assistance, applies to the last financial year unless there is a semi-permanent change in the parental income of at least 30 per cent. Any fall in the income must result in hardship. So in a way this discriminates against students whose parents' incomes go down, but by less than the required 30 per cent, or students whose parents' incomes fall but for less than for two years, or students whose parents 'incomes fall but where hardship cannot clearly be demonstrated.

The present application of the means test to students' allowances assumes that people in the middle income bracket can easily afford to pay for part of their children 's education and living costs. However in many respects such categories of people are worse off than families on low incomes. Usually students who come from low income families receive the full TEAS allowance, but those students from middle income brackets are often means tested out of the allowance or receive only the absolute minimum. So the level of cut-off for the means test is inadequate in contemporary money terms. That is another defect, if I might put it this way, in the operation of the Student Assistance Act. It really needs to be rectified by a government concerned with the operation of the Act.

There are a number of provisions also regarding the means testing of students' incomes. The means test is applied to a student's income and that of his or her spouse if he or she happens to be married. This discriminates in favour of students from wealthy backgrounds, because they are in a position where their parents can perhaps provide them with a flat or a motor car or something of this kind or some means of external support such as assistance with rent and so on. That sort of assistance is not taken into account in terms of a student who has an independent status. Of course the worst example of that is those people who have a high level of income, who by means of tax sharing arrangements and income splitting arrangements pay very little tax and whose student children, because of their taxable income, become eligible for the tertiary education assistance allowance. There are a number of anomolies of that kind which are constantly drawn to the attention of people who are interested in the application of the Student Assistance Act. It is another problem which is of concern and which constitutes a major anomaly.


Senator Messner - But, Senator, are not they combined for the purpose of TEAS?


Senator BUTTON - Are not what combined?


Senator Messner - The income of the two parties.


Senator BUTTON -Which two parties?


Senator Messner - The incomes of the husband and wife. Are not they combined for the purposes of TEAS?


Senator BUTTON - They are, yes. I am sorry, perhaps I used the expression 'income splitting' incorrectly. It is more correctly stated as tax avoidance arrangements, if I can put it that way. Of course it may be that one party does not work at all, and in that situation I think it is fair to describe it as an income splitting arrangement. Take the example of the wife of a doctor who is herself a medical practitioner, who does not practice but who is a member of the partnership and so on. Her income is really part of her husband 's split income, and in those circumstances the student child becomes a beneficiary of the scheme. Perhaps that is not a matter of enormous importance in the context of the financing of the whole student assistance scheme, but of course it is a source of concern that any scheme like this should be made use of in the circumstance in which it is a scheme designed to help the less fortunate student from a socio-economic point of view.

The other two matters to which I wanted to refer in connection with the Tertiary Education Assistance Scheme are concerned with what are called the progress rules of the scheme, which really mean that students become ineligible for the tertiary education assistance allowance because of their failure to satisfy rules outlined in the regulations which provide for a continued progress in their study. This requirement applies particularly when there is a transfer from one course to another. A student loses points under the scheme for previous studies which have been undertaken.

There are other examples like this which continually come to hand. For example, I think only last week, it was, I received a letter from a girl in South Australia who, because of illness, had not been able to complete the required number of units in one year. As a result she lost her tertiary education assistance and suffered quite severe hardship. The regulations are so rigid in their application that they do not provide for a situation like that; they are quite mandatory. If one does not do the required number of units one is out of the scheme. She did not do the required number of units because of illness which was documented, and she lost her tertiary assistance.


Senator Tate - The Tribunal was of no use to her?


Senator BUTTON -The Tribunal was of no use in that situation. I am just coming to the question of the Appeals Tribunal. Perhaps I can come to it now and make the point that the rules which tribunals have to apply leave them very little discretion in many cases of hardship. Any honourable senators who have talked to members of the tribunals in the various States will recognise that because it is a constant source of concern to them that they have to apply very bureaucratic and rigid rules to the matters which come before them, which often results in severe cases of hardship.

The other point which is related very much to the question of progress through one's course is the question of full time study. The example which I referred to of the girl in Adelaide who was not able to complete the required amount of full time study in order to retain her tertiary education assistance -


Senator Jessop - What are you suggesting there, Senator? It is a good point. I am sure that the Government would be interested in some constructive suggestions.


Senator BUTTON -I hope that the honourable senator is right. I made the same point 2lA years ago. The Government has not taken it up yet, so I do not know why I should do it again in great detail tonight.


Senator Jessop - You are making a lot of suggestions.


Senator Tate - Illness is not the same as examination failure. That is simple enough.


Senator BUTTON -It is really very simple.


Senator Jessop - Well, spell it out.


Senator BUTTON -Look, I am not going to draft legislation while I am on my feet for Senator Jessop or for anybody else. It is a very simple solution to say that a person who gets ill and cannot fulfil the required number of units or subjects ought to be able to go to the Appeals Tribunal and. say: 'I have a doctor's certificate. I was ill and I couldn't do it. Please fix up my Tertiary Education Assistance Scheme allowance'. That would be an instant solution as far as Senator Jessop is concerned; it is very simple. I drew attention to it 2V4 years ago in this place and nothing has been done about it since.


Senator Jessop - You have at last spelt it out. You have never done that before.


Senator BUTTON -The honourable senator could not remember my speaking about this subject 2Vi years ago. I am very flattered by the suggestion that the honourable senator might be able to remember anything I said 2Vi years agobut on this subject, certainly not. The other matter which I want to deal with and which is related to the question of student assistance is that of post-graduate awards. There are at present in Australia close on 3,000 post-graduate award holders doing post-graduate research of various kinds. They are immensely important people in terms of the intellectual life of this country, in terms of the research capacity of this country and in terms of our capacity to develop innovative and indigenous research. They are very important people but the value of their awards has declined enormously since 1978.

Senator Carrickand I used to have arguments about whether the awards had declined by 30 per cent or 40 per cent. He always plunged his hand into his Gladstone bag, and produced some new set of figures, but we are really debating the question of whether they had declined by 40 per cent, 50 per cent or whatever. But it is estimated, I think quite conservatively, that to increase the value of post-graduate awards to the level that they were in 1977 would require something in the order of a 50 per cent increase from $4,200- odd- that is the level that they are now- to something like $6,400, having regard to the fact that they are now taxed. By the way, I take no objection to the fact that they are taxed. I think the government did quite a sensible thing, but I think in taxing the awards it should have taken account of the level of them and the circumstances under which post-graduate award holders exist.

In regard to post-graduate award holders I make one very simple point. I seem to remember the present Prime Minister (Mr Malcolm Fraser) saying that his Government would be a government for all the people. All I can say, as perhaps a slightly sceptical observer, is: 'You could have fooled me after all these years '.


Senator Missen - That would not be hard.


Senator BUTTON -As Senator Misseninterjects, it may not be hard to fool me, but it is pretty hard to fool the mass of the people. Postgraduate award holders represent a very important group to the intellectual life and the research capacity of this country. They are a group which has been quite callously overlooked by the Fraser Government for the simple reason that in terms of political clout they are a very small group. Their case for an increase in the value of the award is important, and there should, of course, be more awards made available to postgraduate students in Australia.

Further, to stop people like me finding it necessary to make comments on this matter in this way, post-graduate award holders in Australia should have the value of their awards fixed by a tribunal. The awards should not be fixed at the whim of governments and be included in or excluded from a Budget because of the problems which the Government may or may not have at a certain time. That is not the case with the post-graduate award holders. It illustrates what is wrong with the Student Assistance Act, which is the subject of the report I have been discussing. The report documents failure rather than success on the part of students in this country.

Debate (on motion by Senator Chaney) adjourned.







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