Gavin Marshall (Victoria, Australian Labor Party) Share this | Hansard source

That is right, Senator Nash. I appreciate your remarks earlier and the passion with which you have prosecuted the Social Security Amendment (Income Support for Regional Students) Bill 2010, which is only proper. The Bradley review was a broad-ranging review, but anyone listening to the debate would think that it was all about the independence test—that is the impact that has created the controversy. I think it is worth putting on record some of the background to the review and some of the other very positive changes that have improved equity arrangements for income support and benefits for students. I will take a few moments to go through them and give some background to them.

In December 2008, the Review of Australian Higher Education, the Bradley review, reported on whether the higher education sector was structured, organised and financed to position Australia to compete effectively in the new globalised economy. The Bradley review examined student income support programs and found that they were not accurately targeting students in most need of assistance. It also found that one of the unintended effects was that Youth Allowance was being accessed by some students living at home in high socioeconomic status households. To address these issues the review recommended a comprehensive reform of student income support programs, which the government did. Unfortunately, when you change the rules people will be unhappy if they are adversely affected by those changes, but, overwhelmingly, the changes have benefited many thousands of students.

In response to the Bradley review’s recommendations in relation to student income support, the government announced a package of reforms in the 2009-10 budget. The reforms were aimed at ensuring that only those students who are genuinely independent qualify for assistance. They included changes to the parental income test for dependent students, in July 2010. The parental income test threshold was increased from $33,000 to $44,165 and further increased in January 2011. The 20 per cent family taper rate was introduced to replace the 25 per cent per child taper rate. Changes to how young people can access payments as independent recipients, including lowering the age of independence from 25 years to 22 years, are phasing in from 2010 to 2012. The introduction of the Student Start-up Scholarship for all university students receiving Youth Allowance, Austudy, ABSTUDY or the relocation scholarship was implemented. The Student Start-up Scholarship assists with the costs of textbooks and specialised equipment—even for those on a part-time rate of student income support. That scholarship was $650 in each half year of 2010 and increases to $1,097 in each half year from 2011. These are new programs.

The changes to the parental income test and taper rate will improve access for dependent young people from low- and medium-income families: over 100,000 students are expected to benefit from the changes. Many will receive a higher payment than would previously have applied, and many students who would previously have considered it necessary to gain eligibility as independents will no longer need to. One hundred thousand students will significantly benefit from that reform. It is estimated that an additional 67,800 students will qualify for income support and approximately 44,600 students will receive a higher rate of payment.

In relation to changes to the workforce participation criteria, it was noted that they were about establishing genuine independence, so the whole package of reforms goes to targeting assistance more closely to young people from lower socioeconomic backgrounds. To meet the criteria, students must work an average of 30 hours per week over 18 months in a two-year period. By the end of August 2010 around 174,000 students had received at least one payment under the Student Start-up Scholarship, and over 20,000 students had received a relocation scholarship. The effect of the decrease in the age of independence has already resulted in more than 2,400 students gaining access to Youth Allowance or ABSTUDY for the first time or receiving increased student payments. The government expects 7,000 additional students to benefit in the 1 January 2011 change.

These are significant improvements for over 100,000 students. Yes, it is regrettable that the changes to some of the rules have created some difficulty for some. Those issues have now been widely canvassed and there are some issues that the government needs to look at. It is always a problem when a geographical system is used for entitlement—wherever a line is drawn there will be some people on one side of the line and some people on the other side of the line. This is a difficult issue. It has been problematic for the government, but there is a lot of goodwill from the government and I hope that some of these issues will be resolved to the satisfaction of all parties into the future. The impact of the changes the government has made has vastly improved access for over a hundred thousand students, and I think that needs to be acknowledged.

Question agreed to.