John Williams (NSW, National Party) Share this | Hansard source

I rise to talk about a situation to do with the Rudd government’s changes to youth allowance in the May budget. I can understand where the government were coming from when they first made these changes. The situation was simple. A student completing year 12 and, say, living in Sydney, not far from the university that they wished to attend, could take a gap year. Under the old regulations, they could go out and earn some $19,500. That would then declare their independence from their parents, and hence they would qualify for youth allowance. When you have a situation where a student completes year 12, defers uni for one year, has a gap year and lives at home with their parents—and their parents might be earning $400,000, $500,000 or $600,000 a year—I think it is only right that the government target that situation. Why should taxpayers be supporting that student who is living at home with parents on that sort of money to the tune of some $9,600 a year in youth allowance?

So what the government did was to target this situation—and rightfully so, as I said. Why should a bricklayer or a shearer pay tax each week, only to find that they will probably never set foot on a university campus in their life? They should not be subsidising students in that financial situation. But, in the crossfire, what the government has done is taken out those in rural and regional areas who do not live close to universities—those who have to go off to university, pay for accommodation, and suffer the costs of travel and the standard costs of purchasing books et cetera. The government has done two things that are very wrong. The first thing it has done has had a huge effect, through this policy, on those in their gap year.

I will give you an example. Eli Kimmince is a good young fella. He lives in Inverell, the town I come from. He has taken a gap year and he is working as a manager at McDonald’s in Inverell. Eli comes from a family that I would say does not have much money at all. His parents probably bring in a standard wage; they might earn about $40,000 a year. I am aware of the fact that they earn less than $42,000 because that is the amount below which parents have to earn for their student children to qualify for youth allowance. Eli has deferred university for one year while he is working at McDonald’s, and his goal in life is to next year attend the Australian National University here in Canberra to study a course and then join the Federal Police. What has happened to this young fella? His life has been tipped upside down. Because of the changes to the government’s regulations and the change in the budget, he must now go and work for 18 months. He cannot start university at the start of next year, and he is not one bit impressed, like thousands of others in gap years who are now facing this situation.

They have been held back from university. They will have to work for another six or eight months next year. We have the situation, as I said, that the government has targeted these people who are in cities or who live close to their university and can live at home. It might be in places like Armidale, where we have a reasonable university. We are very proud of it, since it was the Country Party that first got the University of New England on its feet. They can get the youth allowance and perhaps do not deserve it. But those who have to travel away cannot live at home, and we now have these people who are deeply concerned about whether they are going to get to university next year. That is the thing that is so wrong about these changes in the budget.

These people want to be educated. Tell me this: if we do not get them to university, what will we do for doctors, nurses, dentists, lawyers, vets—all the providers of those vital services that regional Australia requires as well as those in the cities? What do we do in the future for those specialist services if we cannot get our students off to universities? That is the problem here, and that is why it is so wrong. I was glad to call a rally recently at the Inverell RSM Club, at which we had 120 people on a Saturday morning. There were teachers, students and concerned parents. Like all parents, all those parents want is the best for their children and to give them a good start in life, and they are very concerned that theirs will not be going to university next year. So that is problem No. 1.

What the government also did in the budget was to make a change such that those who are taking a gap year—instead of working the 12 months, grossing the $19,500 and declaring independence from their parents—now have to work for 18 months. What are the problems with working 18 months? For a start, you have to defer university for two years. What university will defer for two years? The universities have acceded to the situation, which was mentioned in today’s Australian in an article titled ‘Flexible on gap-year deferrals’. It states that, in a move that shields the federal government from a political storm over its changes to youth allowance, the universities are showing some flexibility. But when someone defers for two years, the problem is that they will go and get a job—it might be at McDonald’s, at Coles or at some other supermarket—they will probably get a car, and, if they are young bloke like me, they will probably find a girlfriend. They will probably lose interest in study, and that is the problem. The longer they defer the more likely they are not to actually attend university.

The next point I make is that when students leave year 12 in rural and regional areas—probably out somewhere where you have never visited yourself, Senator Jacinta Collins—where do they find a job? Your forecasts are for 8½ per cent unemployment—one million unemployed next year. Where do they go to get a job for 18 months when the jobs are not there? If they cannot get a job then they cannot qualify for youth allowance. If they cannot qualify for youth allowance then how do they get to university? How do they get through their studies, their tertiary education? How do they qualify to be our nurses, our doctors, our dentists—those vital people who I mentioned earlier on.