Chris Trevor (Flynn, Australian Labor Party) Share this | Hansard source

In addition, I take the point that the member for Mayo raised in relation to the Investing in Our Schools Program and I agree with him on a bipartisan approach. I have travelled extensively throughout my electorate over the last couple of months and have seen some wonderful projects that have been delivered under the Investing in Our Schools Program. Unfortunately, the former Prime Minister of Australia Mr John Howard was not going to continue the program. From what I have seen in my electorate, it was indeed a good program.

What constitutes an eligible family for the purposes of this bill? The bill states that to be eligible for the education tax refund a family must be receiving or eligible to receive the family tax benefit part A. This is the defining criteria as to whether or not a family is eligible to claim for the education tax refund. However, the bill does go into detail to further explain the eligibility requirements for families, and does state that families would also be eligible for the education tax refund if they would otherwise have been eligible for the family tax benefit part A but their child is in receipt of another prescribed payment or allowance from Centrelink, such as youth allowance, disability support pension or Abstudy, and it is this payment that has made them ineligible for family tax benefit part A. Students who are also classed as independent and who receive a payment or allowance, such as youth allowance, will also be eligible for the educational tax refund.

In all these cases, in order to claim the education tax refund the claimant must have their child or children enrolled or registered in a relevant educational institution, whether it is a primary school, high school or, in the case of mature age students, enrolled in a similar course provided by such institutions as TAFE. In total it is estimated that the Tax Laws Amendment (Education Refund) Bill 2008 will benefit approximately 1.3 million families, with 2.7 million students fitting the eligibility criteria.

The bill in my opinion has also been well engineered when it comes to children in shared care arrangements with their parents. The education tax refund will be able to be shared between parents in a similar method to the existing arrangements for sharing of the family tax benefit part A.

The school year and the tax year do not perfectly coincide. Many children will be in a transition from primary school to high school during any one tax year. This could no doubt lead to some confusion amongst parents with different offset amounts between the two levels of schooling. The bill in its current form clears up this confusion, thankfully, by ensuring that the education tax refund amount for a secondary school student, or the highest of the two limits, is applicable should a child transition from primary school to high school during the tax year. The bill also allows for students who may choose to leave or enter school during a school year, with half the amount of the education tax refund able to be claimed to represent the half of the financial year that they attended school.

I am particularly pleased to see that the bill makes clear provision for amounts over the tax offsets maximum limit of $375 for primary students and $750 for secondary students. Expenses that parents incur above these amounts can be carried forward into the subsequent tax year. This will be particularly beneficial for families purchasing large-scale items such as a laptop or a computer that will exceed the yearly threshold. It is indeed comforting to know that they will be able to access the unused amount of the educational expenses in the following tax year and fully benefit from the purpose of this bill.

I am also pleased that the bill has made provision for those who are not required by law to complete an income tax return. In this instance the amount of the tax offset that would have applied to an individual’s taxable income will be paid directly to the individual. These two measures illustrate the government’s thoughtful approach to the bill and thoughtful delivery of this important election commitment.

I would like to take this opportunity to state that parents of students who are home schooled will also be eligible for the educational tax refund. This is fantastic news for them. In my electorate of Flynn, in outback Queensland, some students have no option but to be home schooled due to the vast distances between communities and educational facilities. I am pleased and glad that today this bill recognises them and treats them as no different than any other student attending any other school. In fact, earlier this year in my electorate, the Longreach School of Distance Education was awarded Highly Commended in the Excellence in Family-School Partnerships award at the 2008 National Awards for Quality Schooling. I am proud that these communities have not been forgotten in this bill or by my government.

Having spoken on the eligibility for families under this bill, I would also like to comment on the eligibility of educational expenses to be claimed under the educational tax refund. I am pleased that the list of eligible expenses is a comprehensive list of items that supports a child’s education. I am also pleased that this bill covers not only the purchase of items but also the lease, hire or hire purchase of these items, to better suit individual households and their requirements or preferences. Although it would be difficult to outline here today the many types of school related expenses that could be claimed under this bill I would like to note for the record that under the scheme some of the expenses able to be claimed include but are not limited to: laptops and computers, as well as related equipment including printers; computer software, such as word processing and spreadsheets, as well as antivirus software; school textbooks and stationery; and tools of trade. I am pleased to see not only that the initial cost of a computer is an eligible expense but also that the ongoing cost for home internet access is classed as a legitimate educational expense in this bill. I feel that it is worthy of special mention that the cost for disability aids or equipment to assist children with disabilities to use a computer will also be covered by this bill under the educational tax refund.

No matter which way we look at it, educating a child can be an expensive exercise for a family. Costs seem to add up, with books, stationery and other equipment endlessly on the family shopping list. It has become even more expensive today with high-tech and expensive computer equipment now also a requirement for a basic education. This government will not allow Australian families to be burdened by educational expenses and will not allow working families to face these costs alone.

Although education can be a costly exercise it is ultimately a worthwhile and rewarding one. It is, as I have often said and continue to say, one of the greatest gifts a parent can give to their child. I quote from a longstanding academic on economics and management, Mr Michael Porter. Mr Porter states in his Competitive Advantage of Nations book:

There is little doubt that education and training are decisive in National Comparative Advantage, that is, improving the general education system is an essential priority of government and a matter of economic and not just social policy.

This sentiment is echoed throughout economic literature, with study after study also finding the high rate of return from educational investment. One such study undertaken in 2005 by the Australian National University outlined that in Australia our rate of return for educational investment is around 10 per cent. A 10 per cent return on your investment is a great return, particularly when the investment is in the minds of our young Australians. The total cost of the education tax refund is estimated at $4.4 billion over the next four years. This is a substantial investment in education by my government and a substantial relief for working families who are battling with their children’s educational expenses.

I understand just how tough it is for low-income earners in Australia to provide for the future of their children. To illustrate just how tough it is for some low-income households, the Brotherhood of St Laurence undertook an education cost survey in 2007. The results of this survey found that an alarming 72 per cent of respondents could not afford items that would improve the education experience of their child, 66 per cent did not have access to a home computer with internet access and 60 per cent had difficulty paying for books. This is certainly an alarming set of statistics and one that urgently needed to be corrected. The educational tax refund will help these low-income Australians and ease the burden that they face in simply providing for their children’s education.

As I have stated before, the cost of a child’s education is now more intrusive with the addition of expensive computer equipment which is now vital to a child’s success at school. Of course, families must also cater in the weekly budget for the cost of an internet connection to help with the many assignments and information-gathering tasks that schooling requires. Recent ABS data tells us that around three-quarters of Australian households have a computer at home. Unfortunately, if we look closer into this statistic we see that as many as 90 per cent of high-income earners in Australia have a computer at home but that this figure plummets to under 50 per cent of low-income households. This has been termed the ‘digital divide’—a divide between those who have access to a computer and the internet at home and those who do not. It saddens me that this divide may see some children in low-income households disadvantaged by not having access to a computer or the internet at home. The educational tax refund, thankfully, will help arrest this troubling figure. It will help break down the digital divide by supporting low- and middle-income households in receipt of family tax benefit part A with assistance to provide the educational equipment needed for their children to perform at school.

Already my government has taken the first steps in our commitment to delivering an education revolution. In my electorate of Flynn, 518 new computers are to be installed in high schools as a result of round 1 of the National Secondary School Computer Fund. I look forward to the second round of funding under this scheme to be announced by the end of the year. Of course, the digital education revolution does not stop with the mere purchase of new computer equipment but will continue with the government’s $100 million commitment over three years to support the provision of high-speed broadband connections to Australian primary and secondary schools as part of the Fibre Connections to Schools initiative. My government, the Rudd Labor government, is a government that believes that reliable access to the internet is not a luxury but a prerequisite for a good education and is determined to see Australian children receiving the very best in technologies by world standards.

It is hoped that this bill will be able to apply from 1 July 2008. I would like to remind my constituents in Flynn that, if they are eligible for the education tax refund, they should now be keeping their receipts as evidence of educational expenses that they have incurred and to take advantage of this new tax offset when preparing their tax affairs for the 2008-09 financial year.

With all the benefits that an education can bring to an individual, a family, a community and the nation as a whole, and with the Rudd government’s clear commitment to an education revolution, I commend the Tax Laws Amendment (Education Refund) Bill 2008 to the House and congratulate the Rudd Labor government for its outstanding leadership on this issue.

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