Paul Fletcher (Bradfield, Liberal Party, Minister for Communications, Cyber Safety and the Arts) Share this | Hansard source

I'm pleased to rise to sum up in this second reading debate on the Family Assistance Legislation Amendment (Extend Family Assistance to ABSTUDY Secondary School Boarding Students Aged 16 and Over) Bill 2019, which is being introduced to implement a measure announced as part of the 2019-20 budget.

In the budget, the government announced that it would extend family tax benefit to the families of Abstudy students who board away from home to attend secondary school. This will remove the existing perverse incentive for Indigenous students to drop out of school at age 16. I thank the Senate Community Affairs Legislation Committee for its report on the bill and its recommendation that the bill be passed.

Under current arrangements, once an Abstudy boarding student turns 16 he or she no longer attracts family tax benefit. This creates a perverse incentive for families to retain family tax benefit by removing their child from boarding school. This is a policy normally that is not aligned with the government's objective of supporting Indigenous students to complete year 12. Many remote communities have no local secondary school, so boarding is frequently the only option for children to go to secondary school. However, Aboriginal and Torres Strait Islander boarding students are disproportionately dropping out of boarding education around the age of 16. Data from the Department of Human Services shows that the number of Abstudy boarding students drops by approximately 60 per cent between the ages of 15 and 17.

The Prime Minister's 2019 Closing the Gap address to parliament emphasised that access to quality education for Indigenous students in remote and very remote areas can be a lifeline to future prosperity and wellbeing. This statement echoed the views of the House of Representatives Standing Committee on Indigenous Affairs in its 2017 report on Indigenous education, which stressed the importance of education but found room for improvement in the support of Indigenous boarding students.

Amendments introduced by this bill will build on the 2018-19 budget measure '50 years of Abstudy', which provided $38.1 million over five years to improve assistance for Indigenous secondary students who need to study away from home. It includes better, fairer and more flexible travel provisions and the portability of Abstudy benefits if students change schools. This bill will extend family tax benefit to eligible secondary students aged 16 years and over who receive Abstudy assistance to study away from home. These changes will commence on 1 January 2020, subject to the timing of the passage of this bill. Extending family tax benefit to Abstudy boarding students is consistent with broader family tax benefit rules. It also aligns with recommendations from the 2014 Forrest review Creating parity.

Currently, families of Indigenous boarding students aged under 16 are generally eligible for both Abstudy and family tax benefit. Abstudy for these students is paid directly to the school and boarding provider to cover tuition and boarding costs, while family tax benefit is paid to the family to help with the cost of raising children. Families rely on family tax benefit to meet the ongoing costs of their children's daily incidentals while they are away at school, as well as their living costs when they're at home during school holidays. Once the student turns 16, family assistance legislation precludes Abstudy students from receiving family tax benefit, leaving families with no assistance for the cost of everyday essentials for the child. The loss of family tax benefit when a boarding student turns 16 is a significant drop in income support for families, which contributes to financial pressure for families at a critical stage in a young person's education. Modelling using the priority investment approach shows Abstudy students who stay in boarding for their senior schooling are less likely to need income support in the future. Changes introduced by this bill will mean that, from 1 January 2020, families of Indigenous boarding students will stay in the family tax benefit system until their child reaches the end of secondary school. The families of more than 2,000 Indigenous secondary students will benefit from these changes. On average, these families would receive an additional $5,911 per year.

Through these changes, the government is delivering an additional $36.4 million in support over the next four years. This investment will contribute to increasing the proportion of Indigenous students who complete year 12, improving their work prospects and lifetime wellbeing and reversing the potential cost to the community that comes with long-term unemployment and welfare dependency.

In summary, this bill allows for the implementation of measures that will extend family tax benefit to the families of Abstudy students who need to board away from home to attend secondary school. I commend the bill to the House.

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