Natasha Stott Despoja (SA, Australian Democrats) Share this | Hansard source

The Student Assistance Legislation Amendment Bill 2005 legislates for something that has already been done—that is, the closure of the Student Financial Supplement Scheme, the SFSS. As honourable senators may be aware, the government first moved to close this scheme in 2003. The rationale that was offered at that point included a reduction in the number of people taking up the scheme and the level of debt as a consequence of taking up the scheme if you were a student.

I do not think the declining demand for the scheme should take anyone by surprise. As the Democrats consistently noted—in fact, from when this particular scheme began—the scheme was fraught with difficulty. It was first established in 1993. We found it a punitive and miserly measure that targeted vulnerable people in particular—that is, people from lower socioeconomic groups or rural and regional students; those who were already in financial straits. Without income support, those groups of people would have had little opportunity for pursuing further study, so it became an important crutch, if you like, for people who wanted to study and were therefore prepared to incur unreasonable levels of debt.

With the SFSS, students found themselves trading in $1 of their student income support for $2 of loan. The entitlement that was traded became part of the loan, leading to quick debt accumulation. Many students were not aware that they were actually trading their entitlement for a loan. A number of student representative groups, peak groups, in Australia rejoiced at the closure of the scheme because it unfairly penalised people already struggling with university costs, debts and, of course, university fees, and they felt that this was luring students to forgo income support to which they were entitled.

So the Democrats are not unhappy to see this scheme closed. When this was first announced in 2003, I was very up front about the fact that we did not think that this was an appropriate scheme and that it was not a fair one. Mind you, we were strongly arguing for other support measures to replace it. Nonetheless, my main concern was how we were going to look after the students who were already in the scheme—students who had those loans and required those loans for the duration of their degree.

The Democrats did not simply plan to introduce amendments, but, as I recall, I did introduce amendments. As I recall, I circulated amendments in this place in 2003. The intent of those amendments was to grandfather the students who were already in the scheme. As senators may be aware, the government saw the writing on the wall. Of course, this is pre the coalition-run Senate. That means that those of us on the crossbenches and in the non-government parties could have succeeded in passing the amendments to grandfather the students who were in that scheme. In fact, I remember having discussions with the Independents at the time, particularly Senator Harris, as I recall, who was also particularly keen to ensure the protection of the students and the families who were already affected by the loan scheme.

I am sure that many senators, like my office, had many phone calls, faxes, pleas, letters et cetera from families and individual students, pleading with us to ensure that this scheme, upon which they relied, would not be shut down. But the government saw the writing on the wall and decided to do what we are probably seeing a lot of these days, but, nonetheless, it still surprises me. In fact, the last time that I can recall it happening while I have had this portfolio, which is almost 11 years, was for the closure of NBEET, the National Board of Employment, Education and Training. Senators may remember how that was closed down in an administrative way—the board ceased to exist—before the legislation was passed.

So what did the government do this time? They closed it down administratively and now we are dealing with the legislation. I do not know whether it has escaped people’s notice but it is actually 2006 now—just a couple of years later. I am glad that the government have got around to it, because I was really looking forward to this democratic opportunity to debate, weigh up the methods and the process, and determine whether or not it is an appropriate thing to do. We lobbied the relevant minister. We made very clear to ministers, their advisers and others that we wanted to install a sunset clause in the legislation to protect the students in the scheme who, let us face it, effectively just had the rug pulled out from underneath them, but unfortunately that was to no avail. Although we recognised that the scheme was inequitable—I remember that one student financial adviser described it as ‘insufficient, mean and tricky’; that might be applied, too, to the process with which it was closed down—many students relied on the scheme to fund their study. To shut it down without offering anything in its place was a mean solution.

Senator Wong made reference to some of the statistics. They are pretty alarming, but they are worth putting on record so that government members understand what they did. In the last year of its operation, nearly 40,000 students applied for and accepted an SFSS loan. Many of those students were from traditionally disadvantaged groups, more than half were woman and 15.2 per cent were listed as recipients of the single parenting payment. Those are the types of people who were being disadvantaged by the sudden closure of the scheme, without any replacement, grandfathering or other forms of support.

The abolition of this scheme without the grandfathering of those already relying on it to facilitate their study had, I think, such a mean impact. It did affect the ability of some students to finish their degrees and courses. People told us that it put their study in complete doubt. So the bill now officially brings to a close a scheme that has already been ditched. Still we hear nothing about potential replacements for this measure. Look at the budget last night. Where is student income support? I should not be so naive as to even ask that question. In the last decade it has not been there. There has been nothing on student income support. It is bad enough that the skills shortage was not addressed and education was not really invested in. There was nothing for schools. Higher education—what a joke! As for raising the FEE-HELP cap—please—that is just more debt for students! There was no student income support, although we know that it is one of the key measures to facilitate participation in higher education for lower socioeconomic and other disadvantaged groups. This is just another example.

I think that student income support in this country is in an appalling state of neglect. That has been caused by successive governments, but at least the Labor Party in the nineties was trying to achieve some changes, albeit not enough. But the last decade has just been absolutely appalling. In fact, if senators are interested or if they have any doubts about the appalling state of neglect, just look at the Senate inquiry that the Democrats initiated—the first income support inquiry that looked solely at student income support. Look at some of the statistics contained in that Employment, Workplace Relations and Education References Committee report and listen to the stories that students, advisers and others told. Probably we heard most of the extremes, whether it is students being forced to work in the sex industry or, as I heard at the committee hearing in Adelaide, students being used as guinea pigs for medical experiments in order to earn some money.

We listed the anomalies and punitive measures that actually exist within the current system, such as Austudy recipients not being eligible for rent assistance. This is one that still staggers me. Why on earth is it that if you are on the common youth allowance you can access it, but you cannot if you are on Austudy? When I have put this to people, including people high up in government, no-one has come up with a rationale. Even at the committee hearings, no-one gave me or the committee a convincing reason for it. I still hope that maybe in next year’s pre-election budget we might see some action on this. Another issue is the part-time postgraduate scholarships in relation to taxation.

It was reported that students who are single and over the age of 25 who are ineligible for rent assistance are eking out an existence on a payment that is effectively 49 per cent below the poverty line. Economic survival has usurped academic success as the main object of many students. The committee report says:

The result is that many students find themselves in a precarious financial situation, struggling to provide themselves with the basic necessities of life.

What does the government think—that living below the poverty line for students is somehow a rite of passage? Is it some sort of outdated romantic notion of students studying at university today—that it is about eking out an existence? Do they think that is what you have to do to earn your degree?

The vice-chancellors do not agree with that archaic image. The vice-chancellors—and, as I often remind people, they are not the most radical organisation—have been at the forefront of the arguments for reform of student income support in this country. They are worried about the statistics that show how many students are missing classes, tutorials, lectures and study time as they have to work to support themselves because of the lack of income support, the paltry amount of income support and the inaccessibility of income support in Australia today. Many students are spending hours off campus working in part-time jobs. The committee found:

They are working longer hours than before to the detriment of their studies and their overall experience of university.

I would add that the National Union of Students recently found that almost one-third of part-time students work more than 16 hours per week. It condemned the state of student income support under the current government. The report goes on to say:

The committee believes the financial situation of many students under the policies of the Howard Government is grim, and that the evidence presented to the committee during the inquiry shows that it has deteriorated even further over the past few years.

In addition, the potential impact of the introduction of so-called voluntary student unionism is going to have a hugely deleterious effect. What did we see in the budget last night? We saw the cheap, sell-out, transitional fund—$81 million or whatever it is. Well done, Family First! That is great. That is putting families first. What a cheap sell-out! I think there was also a $10 million scheme for small businesses to encourage them to set up on regional campuses that may be adversely affected by the impact of voluntary student unionism. Mr Acting Deputy President, I misled the Senate. Remember, that transitional fund relates mostly to sporting and recreational facilities on campus. It is not about other issues. So students are in for it yet again. I start to think it is about a rite of passage now. I do not believe that those government ministers who got their education publicly funded necessarily believe that that is what the next generation should have or deserves.

Severe rules on eligibility for student income support have prevented many students from accessing it at all. The inquiry found that the parental income test threshold is too low. It is not keeping pace with wage increases and, indeed, the cost of living. This valuable report comprehensively and thoroughly examined the sector. It examined the issues, particularly the shortcomings of student income support. Despite the fact that the government had representatives on the committee who concurred with the recommendations—remember, there was a majority signing-off on these recommendations—and despite the fact that the government members signed off on the recommendation that rent assistance be extended to Austudy recipients, the government has done nothing. The committee recommended that a costing on this measure should be undertaken and completed before the end of 2005. Well, we missed that deadline. Then again, if you look at the rate of progress, it has only taken 2½ years to close down a scheme that has already been closed down. Maybe we are working in dog years.