Brendan O'Connor (Gorton, Australian Labor Party) Share this | Hansard source

I would like to associate myself with the comments made by the member for Prospect, the shadow minister for education, and others on the side of the House, in opposing the Student Assistance Legislation Amendment Bill 2005. This bill is, of course, similar to the one that was before this place in October 2003, but this chamber and the Senate have, quite rightly, rejected the contents because, as the member for Prospect quite rightly said, this scheme has provided sufficient sums—not by any means great sums, but sufficient sums—to supplement whatever income students had in pursuing their education. There is no doubt that, by closing down this scheme, things will only get more difficult for students.

I do believe it is important that we look at the way in which this scheme and, indeed, what will follow it interacts with what has been happening to HECS, and what has been occurring in the education system—in particular, the way in which people can now purchase entry into university. It is certainly true—the dumb and rich proposition; like a good pasta sauce, thick and rich—that we have a situation where we are allowing people in based on the content of their bank account and not on their capacities as a person to pursue a particular discipline in a university. It is an awful thing. More than 90 per cent of the people in my electorate have an income of less than $50,000 per annum in gross terms. I would not expect one constituent of mine to be in a position to be buying $100,000 degrees up front. This measure compounds what is clearly an inequity in the system. It further disenfranchises very bright students from low socioeconomic backgrounds. We on the side of the House, as we did in 2003, oppose the closure of the scheme.

Like the member for Prospect, I thought that HECS when introduced was a balanced scheme. There was enormous disquiet among people in imposing a fee upon students who had hitherto not or at least for a significant period had not been required to pay fees. We are aware, of course, that many in this place—on this side and on the government side of the chamber—effectively managed to get a free education. Many ministers, including the Treasurer and the former minister for education, who was the architect of this original bill, received a free education when they went to university.

When Labor introduced HECS there was some effort to balance obligations and privileges for our students. If you look at the amount that was to be paid and look at the threshold of income that a student had to reach before that payment was triggered, you see we had the right balance. We had the right balance because the income that triggered the payments to HECS was one that was close to the average weekly income. In 1997-98 in the first Howard term we saw a dramatic reduction in the threshold income. It went from $27,000 per annum to $20,000 effectively overnight, forcing students into a position of paying back a debt on an income that was 25 per cent less than the income in the previous year, placing people close to the poverty line—indeed, below the poverty line.

It is true to say that the government has corrected that trend and did so recently, but for those many years since the 1997-98 financial year, the students of this nation were placed in a very difficult economic situation and found it increasingly difficult to maintain their studies and actually live a reasonable life on an acceptable income. We do not want to be creating disincentives for our talented young people to further their education. We do not want a system that is based on money rather than merit. We want an education system that expands and encourages our best and brightest to participate not only to further and improve their lot but that of this nation as a result of skills gained.

I do associate myself with the comments of earlier speakers from this side of the House on this bill. The government is wrong in looking to abolish the scheme. The Student Financial Supplement Scheme was a voluntary loan scheme which allowed students to borrow money to increase their income while studying. As I understand it, for every $2 of a loan, students gave up $1 in Centrelink payments. Repayment was voluntary until 31 May of the fifth year after the year the loan was received. Students got a bonus on repayments during this period. After the five years repayments were compulsory when taxable income reached the level of average weekly earnings, which in the 2000-01 financial year was $31,639, and were then paid through the taxation system. We thought that was reasonable.

Clearly it would be better if students did not have to take out significant loans. However, it is now increasingly likely because of the increased cost of HECS and just higher basic living expenses. This loans scheme was by no means perfect. It was not a panacea for all the problems that students may have had in pursuing their education, but it did provide modest support, it was a reasonable and fair system and it did ensure that students maintained their education and continued with their studies.

I am aware that the Senate inquired into this matter as late as last year. Their report and the recommendations therein were clearly not considered by this government. The Senate inquiry to which I refer released a report in June 2005 which said many things, including the following:

... the system—

this is talking about student income support as a whole—

operates with various disincentives, inconsistencies and anomalies which penalise the students who are in most need of financial assistance. Students from households with low to modest incomes, from regional and remote areas and Indigenous students are hardest hit by these systemic failings.

The report found that income support payments under Youth Allowance, Austudy and Abstudy are between 30 and 50 per cent below the poverty line, causing extreme financial hardship for increasing numbers of students and particularly Indigenous students. Clearly, the Senate committee thought that the combination of Youth Allowance, Austudy and Abstudy was not working, and therefore it made those comments.

There were many submissions made to the Senate inquiry. The submission made by the Australian Education Union quoted ACOSS figures. ACOSS compared the Henderson poverty line and social security payments for students, and their figures showed how student payments lie between 63 per cent and 82 per cent, well below the poverty line. So even now, for example, if the income provided by way of Youth Allowance or Austudy was the sole income of students—and I am not suggesting that would be the case in most circumstances—they would all be receiving an income below the poverty line. But as it is the case that the proportion of those payments is reducing, there is no doubt that, even with other forms of income, more students are finding themselves with an income below the poverty line.

Therefore, we are in a situation where students are going to opt out of education—regardless of their abilities, regardless of their capacity to further their education because of their academic excellence—based on economic considerations. Conversely, this government thinks we should be selling degrees, that we should put up shopfronts at universities and flog them off for $100,000. That is the reality. When the former minister for education turned up to universities, he should have just gone along with an ice-cream van and flogged off degrees like ice-creams for $100,000, regardless of whether those concerned had any capacity to pursue an academic career in a particular discipline. This is a government that clearly believes it is more important to be able to pay for a degree than to actually fulfil the requirements of a discipline at university. ‘Money not merit’ is pretty much the catchcry of this government: if you have money, you can get a degree.

Clearly, this loan scheme should not be closed. It was a modest but certainly a decent attempt to assist students in need. The Senate and the House of Representatives got it right in 2003, when they rejected a bill of similar substance. We on this side believe the legislation should not be pursued further. In reading some of the submissions made to the Senate inquiry, it is clear that students are doing it tough. For the life of me, I cannot understand why this government has such an enmity towards students. I cannot understand its pursuit of attacking students, knowing that in an economic sense it is a very vulnerable time for many of them. This is just another example of an insensitive, out-of-touch government not concerning itself with people who are doing it tough.

It will be the case that many students will survive this and go on to be qualified in their preferred area of expertise, but it will also be the case that, as a result of the combination of decisions made by this government in the area of education, many talented students will be knocked out of the system and we as a nation will be worse off as a result. Their personal ambitions will be thwarted and we as a nation will be worse off because, instead of encouraging people with talent, enthusiasm and academic excellence, we are saying to those who have difficulty in paying, ‘Too bad,’ and to those people who cannot qualify but who have the money, we are saying, ‘You’re welcome in.’

We do not want to see an education system in this country that favours people with money over people with merit. If that is what this government is about in the area of education then it has it entirely wrong. I think the people of Australia know that, I think the mums and dads who are trying to get their kids into post-secondary education know that, and I certainly know that the students of this country know that. That is why Labor opposed similar legislation in 2003, that is why we oppose this bill, and we certainly hope that the Senate does the same.

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