Real youth income support needed

Issue 

On March 18, the federal government managed to pass its new youth allowance scheme through the Senate. The government's main aim was to tighten eligibility requirements for students getting youth allowance, so that young people now have to work an average of 30 hours a week for 18 months before qualifying for the benefit.

The bill had been debated in the Senate for months, mainly due to the Liberal-National opposition delaying its passage citing concerns that it disadvantaged rural students. Eventually education minister Julia Gillard agreed to a deal that provided concessions to some rural students.

The "age of independence" — that is the age at which students automatically qualify for "independent status" and receive higher youth allowance rates — has been lowered from 25 years to 22 years. But this will be phased in, starting at 24 years on April 1, then 23 years in 2011 and 22 years in 2012.

This is an improvement, but it merely returns us to what existed before Howard's 1997 bill that raised the threshold to 25 years. The age of independence should be lowered to 18 years, the age that is broadly recognised by social and legal conventions as that of an adult.

The Parental Income Threshold (PIT) for students to receive the maximum youth allowance rate has been raised from $33,300 to $44,165.

This means that more students will be able to access youth allowance and others already receiving it will get higher rates.

However, when comprehensive student income support was first introduced by then PM Gough Whitlam in 1974, the PIT was set at the average weekly full-time earnings, which in today's dollars would be about $60,700. While this increase will help many students, many others will still miss out.

Students will now be able to earn up to $400 per fortnight from working before they begin to receive lower youth allowance rates. This is an improvement upon the previous $236 threshold. However, it still remains a token gesture as even a student receiving high youth allowance rates would be living at under the poverty line.

The main problem with the bill is the workforce participation criteria for independence. Students classed as financially "independent" receive higher youth allowance rates than those who are classed as "dependent". But for students to prove they are independent, they must work for an average of 30 hours per week full-time for 18 months in a two-year period.

The Coalition opposition's beef with this was that rural students would be disadvantaged because of less access to work opportunities in rural areas. The National Party gets most of its votes in rural areas.

The deal struck between government and the opposition included concessions to students whose family homes are in areas categorised as Outer Regional Australia, Remote Australia or Very Remote Australia. These students will be eligible for independent allowance rates by working for 15 hours a week over two years, or earning almost $20,000 in 18 months.

Since these concessions to rural students would put the plan's budget into the red, the government, instead of diverting money from destructive or unnecessary sectors of the economy, decided to decrease funding for student start-up scholarships to keep the program "budget-neutral".

Most of the media coverage of these changes has focused on the opposition's "success" in winning gains for some rural students and the government's failure to apply the Workforce Participation Criterion equally for all rural students.

The National Union of Students (NUS) also supported the bill.

"We are obviously very happy that it will be passed this week because it is the deadline essentially", NUS president Carla Drakeford said.

"If it was passed any later, students would not be receiving scholarships, so we're happy that the stage has finally ended."

Yes, these aspects are important, but the media and NUS focus on these points obscures the main problem with student support in this country — that many students who are living away from their family homes must work 15 or 30 hours a week for 18 months over two years in order to win the right to be supported.

An Australian Vice-Chancellors' Committee survey conducted in 2000 indicated that a large minority of students must skip classes and study to engage in paid employment; and that a smaller but still large number go without food or other necessities because of financial hardship.

From 1974 to 1988 university education was free in Australia. Many European countries provide free tertiary education, or access with only modest fees.

The government's insistence that the student support package remains budget neutral is neoliberal dogma. Important social services are neglected while billions are spent subsidising the fossil fuels industry, bailing out banks and waging war.

Resistance believes that people's needs should come before private profit.

[Duncan Roden, a Resistance member, is the Socialist Alliance candidate for Parramatta in the upcoming federal election.]

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