Release type: Media Release

Date:

100,000 students better off under Labor - 146,600 worse off under the Coalition

Ministers:

The Hon Julia Gillard MP
Minister for Education. Minister for Employment and Workplace Relations
Minister for Social Inclusion
Deputy Prime Minister

The Minister for Education, Julia Gillard, said the Government will move to benefit more than 100,000 students with changes to Youth Allowance to be introduced into the Parliament tomorrow, while the Opposition seeks to take almost $50 a fortnight away from 146,600 students.

The Government’s proposed changes will mean that all university students receiving Youth Allowance, ABSTUDY or AUSTUDY will be eligible for scholarships, students and their parents will be able to earn more before they lose their allowance and students will be able to claim independence earlier.

Key elements include:

  • All university students who receive Youth Allowance, ABSTUDY or AUSTUDY and not receiving a different Commonwealth scholarship will receive a$2254 Start-Up Scholarshipevery year.
  • Theparental income test will be raisedso that families with 2 children studying away from home can earn more than $140,000 before their allowance is cut completely.
  • Students on Youth Allowance who need to move to study may be eligible for an additionalRelocation Scholarship, worth $4000in the first year of study and $1000 each subsequent year on top of the Start-Up Scholarship.
  • From 1 July 2012,students will be able to earn $400a week (up from $236) without having their payments reduced.
  • Theage of independence will reduce progressivelyfrom 25 years to 22 years by 2012, which will se an estimated 7600 new recipients of the independent rate of allowance.

These changes will see Youth Allowance targeted at those families that need assistance most. Under the existing system, of independent students who live at home, 18 per cent come from families with incomes of more than $150 000, 10 percent above $200 000 and 3 percent above $300 000.

The current broken system introduced by the Coalition has seen regional and rural participation actually decline from 2002 to 2007. The extremely low parental income test has effectively forced students into claiming independence from their families, taking a virtually compulsory gap year after which we know 30% do not subsequently take up their university offer.

Under the alternatePyne Plan, almost $700 million will be torn from the pockets of students as start up scholarships are reduced permanently by $1254 every year. Next year this equates to 146,600 students losing the equivalent of $24 a week, each and every week they’re at university.