By Daniel Kelly
Students and parents are worried that the federal budget will slash and further restrict student living allowances in 1997. The worst case scenario is the complete replacement of Austudy with a loans scheme similar to the Austudy Supplement, a loan introduced by Labor. Abstudy, a similar living allowance for Aboriginal students, may or may not suffer the same fate.
To receive the Abstudy/Austudy Supplement, a student has to trade in part of their non-repayable living allowance for a loan of twice the value of the trade-in amount. This loan is repayable after five years and is billed as "no-interest" as it only increases with the annual consumer price index. The fact that a student must pay 50% interest at the outset, by foregoing that much of their living allowance entitlement, is glossed over in the publicity for the scheme.
A straight-out loans scheme would abolish even the fig-leaf of choice that goes with the Supplement. (The choice to borrow isn't an option because Austudy's low living allowance payments make going into debt through receiving the Austudy Supplement a necessity for many students.)
Labor set the scene for a transition to a student loans scheme. Labor's "learn now, pay later" approach to education began with the introduction of the Higher Education Contribution Scheme (HECS) in the 1988 budget. Given the relatively high level of student mobilisation at the time, the ALP opted for HECS rather than up-front fees hoping to provoke less opposition. Through HECS, students accrue a debt according to the number and weighting of subjects they enrol in; this debt is later billed through the taxation system.
In response to demands to increase Austudy to a livable level, Labor introduced the Austudy/Abstudy Supplement loan in the early '90s. Austudy currently pays significantly less than unemployment benefits in almost all cases, even if a student qualifies for the maximum rate.
The maximum rate of Austudy is means tested according to parental income for students under 22 years old unless the student qualifies as independent. (Labor had already tightened the independence qualification from working full time for two of the last five years to working three of the last four.) Austudy is also reduced if a student earns over $3000 per semester ($60 per week) from part-time work while studying. Unlike unemployment benefits the vast majority of students are ineligible for rent relief payments or health care card benefits.
Despite its rhetoric of equity in access to education, Labor tightened the eligibility criteria for student living allowances and kept payments to such a low level that only those supported by wealthy parents, or with considerable savings, were likely to be adequately resourced and able to concentrate on their studies. Now the Coalition is seeking to accelerate the cuts to public funding for education.
In addition to its direct attacks on university funding, the Howard government has slashed staffing levels in the Department of Employment, Education, Training and Youth Affairs (DEETYA) by 20% — before the budget. Some Student Assistance Centres will lose up to 40% of their staff through voluntary redundancies and most SACs will lose 20% of their staff on August 19, the day those taking redundancies depart.
These staff reductions are an ominous sign for the future of student allowances as SACs, already in a staffing crisis, will be unable to administer the schemes as they currently exist in 1997. It seems that next year, at best, cut down versions of the current schemes will be offered. Students are likely to see a "lean and mean" Austudy scheme that doesn't ask as many questions and excludes whole categories of students.
The government is known to be considering the abolition of the Pensioner Education Supplement — a $60 per fortnight payment to pensioner students. Austudy payments to high school students may be abolished (Austudy is currently available to high school students over 16, subject to a parental income test). The Howard government may abolish some or all of the mechanisms for students under 22 to qualify for the independent rate, and may raise this qualifying age (already ridiculously high) even further.