Jill Hall (Shortland, Australian Labor Party) Share this | Hansard source

I will start by saying that I know the member for Parkes is a man who is very committed to his electorate and I know that he looks at things very much from the perspective of his electorate. I find myself often agreeing with him on issues, but unfortunately on this issue I do not agree with him. I actually grew up in rural Australia, so I am fully aware of the challenges young people face when they leave home to undertake further study and of the problems and disadvantages associated with education in rural areas. But I have to say that the Central Coast area of New South Wales, part of which falls within my electorate, has the lowest retention rate of schools anywhere in Australia and also has the lowest participation rate of students attending university.

I fully support the Social Security and Other Legislation Amendment (Income Support for Students) Bill 2009 that we have before us today and I would like to congratulate the minister on the process she has undertaken so that we have got to this stage of having this legislation before us. She has undertaken widespread—and I emphasise widespread—consultations with the community and with people affected by this legislation. Coming out of those consultations there have been some changes to the bill and I believe what we have before us today is good strong legislation that will benefit a large number—again I emphasise, a large number—of students throughout Australia.

This bill will amend the Social Security Act 1991 to implement key recommendations of the Bradley review of higher education. That review made some very strong points and claimed there was a need for change because the current system was poorly targeted. It made 46 recommendations and from those recommendations the package of reforms for student income support has been introduced. The bill significantly liberalises personal and parental means-testing arrangements that have applied to payments for dependent students, apprentices and unemployed young people so that more low- to middle-income families can access youth allowance and Abstudy. It changes the criteria upon which a youth allowance recipient is considered to be independent. It provides for new entitlements for scholarships for university students receiving student income support payments: an annual student start-up scholarship and a relocation scholarship for eligible students. I would see that as being very beneficial to those students coming from rural areas. It also exempts merit and equity based scholarships from the social security income test, up to a threshold of $6,762 a year. Each recommendation for reforming student income support arising from the Bradley review has been adopted. The review was conducted and the recommendations were adopted.

Amendments to the Social Security Act to make significant changes to the personal and parental means test arrangements for payments to students and youth will have an enormous impact in my electorate. While the member for Parkes said he had had a considerable number of people visiting him in his electorate office with problems associated with this legislation, I have to say that over the time I have been a member of parliament I have had a large number of people visit me because their children are ineligible for youth allowance, and these are people who are on very low incomes. He talked about the plumbers and council workers in his area who are ineligible for youth allowance. Well, those are the very people in the Shortland electorate who have come to see me because their children have been ineligible to receive youth allowance, and this has been a longstanding problem.

It is important to recognise that these changes to the income test liberalise the amount of money that parents can earn, and they also have a tapering effect. The core part of the reforms will be the relaxation of the parental income test, with the maximum rate of assistance for dependants under youth allowance and Abstudy, and that will take effect from January 2010. This will increase the parental income test threshold from $32,800 to $42,559. That is a significant increase. That is for the maximum payment. The reforms will also soften the current tapering rate—from 25 per cent per child to 20 per cent per family. This means a family with two children aged 17 and 19 who are living at home will receive income support up to a total family income of just over $100,000, compared to the previous cap of $60,000.

I think it is only fair that I share with the House tonight a letter I received from a young student. Her parents live in Shortland electorate but she has been required to go to Sydney to undertake her studies. She has struggled financially. Because her parents’ income just exceeds $60,000, she receives no income support. She was on the verge of withdrawing from her studies. When I told her about the changes that will be introduced in this legislation, she was quite delighted. These are the kinds of changes that she wanted to see come into effect. These are the kinds of changes that ensured she would be able to continue to study. In the time I have been a member of parliament, there have been number of young students who have withdrawn from their studies. That is a loss to Australia as a nation. These are young people who would have completed their education and developed the skills and gained knowledge to work at a high level in our society. I agree with the member for Parkes on one thing, and that is that education is vitally important to young people. Education is the key that unlocks the door to allow young people to be financially secure. It is the key that unlocks the door that will give them the skills and knowledge they need to undertake jobs that will provide them with a very comfortable lifestyle.

Going back to income support, a family with two children aged between 19 and 23 who have had to move to study at university will now be able to receive some support with a parental income of up to $140,000. That is quite significant. I was reading through some information prior to making this speech. I saw that, over the period of the previous government, there were a number of changes to the youth allowance which disadvantaged people who live in electorates like Shortland. This legislation moves the base so that it provides significant and secure income support to the majority of students who want to attend university. Four students who are relocating, the maximum family income will be $168,000. That is quite a significant income. These changes will allow 68,000 more young people to access youth allowance. That is 68,000 students who, prior to the introduction of this legislation, would have been ineligible. So, far from making it difficult for students, this legislation will benefit so many young Australians. And, as I have previously stated, this legislation will benefit Australia as a whole.

The government will progressively lower the age of independence from 25 years to 22 years, which will enable more students to access income support over time. Currently a student is considered to be dependent on their parents up until they are 25 years of age. This legislation will change that to 22 years of age. That has also been a bone of contention with many people who have come to visit me when they have had problems supporting their young adults whilst they are attending university. They cannot understand why their 25-year-old is considered to be dependent upon them. There will also be an increase in the personal income test threshold from the current $236 per fortnight to $400 per fortnight, and that will commence on 1 July 2012.

There will also be the introduction of a new annual start-up scholarship of $2,254 each year for all university students receiving income support. That will be so beneficial to those 68,000 new students who will be eligible for youth allowance. University students on youth allowance will receive the full value of the scholarship, even if they are only receiving $1 of student income support. The scholarship is equivalent to a $43 per week rise in youth allowance. An estimated 146,000 of these scholarships will be used next year compared with the 12,900 allocated for commencing students under the old system. Once again: 146,000 students are set to benefit; previously 12,900 benefited. I can only see this as being good, I can only see this as benefiting students and I can only see this as a very positive change to youth allowance.

The introduction of the relocation scholarship of $4,000 in the first year and $1,000 in later years will provide assistance with the cost of relocating to study for dependent university students who have had to move away from the family home—that is, for students disadvantaged by personal circumstances. There will be 14,200 of these scholarships assessed in 2010, rising to 28,700 in 2013. This compares with 8,100 Commonwealth accommodation scholarships allocated to commencing students under the current system. Once again, this is an enormous increase in the number of students who will be able to benefit from assistance from the government. Once again I would argue that far from disadvantaging students, this is providing an enormous opportunity to students who have missed out. This is providing so many more students with the opportunity to benefit from assistance.

My good friend, the member for Parkes, is worried that people in his electorate will be disadvantaged and will not be able to get assistance. What I would say to the member for Parkes is: ‘Look at the figures and you will see that more young people from your area will benefit from the relocation scholarship, benefit from the start-up scholarship and, in all probability, benefit from the liberalisation of the current youth allowance income test.’

In the short time I have remaining I would like to address the issue of a gap year. First and foremost, any student who has already established their independence and is receiving youth allowance in the period up to 1 January 2010 will not be affected in any way by the changes. Further, until 30 June 2010, young people who completed secondary studies in 2008, took a gap year in 2009, commence university prior to 30 June next year and are required to live away from home to study will continue to be able to attain independence under the second and third elements of the workforce participation criteria. That means they will not be disadvantaged and that the decisions that they made prior to the introduction of this legislation will not be affected at all by this legislation.

I would argue very strongly that the changes that this legislation brings into force will benefit an enormous number of students. These are changes that students living and studying in my electorate and other electorates throughout Australia will be able to benefit from. These are changes that students living in rural areas will also be able to benefit from. I emphasise that the electorate that I represent in this parliament is an outer metropolitan area with the lowest retention rate and the lowest participation rate in university studies in Australia. When I studied, I went to school in a rural area, so I do understand the issues associated with students living in rural areas. Given all these facts, I see that this legislation has been developed in a very thoughtful way. There has been considerable consultation. It introduces all the recommendations of the Bradley review into Australia’s higher education system. I believe that the legislation should be supported by the other side of the parliament. I do not believe that this legislation should be used as a political football to promote members on the other side of the parliament. Rather, I think it should be supported and that the benefits that this legislation provides should be noted by both sides of the parliament.

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