When the Federal Government announced its economic stimulus package last week, it made much of its $950 Teaching and Learning Bonus for students. Like other groups (including single-income families, farmers, and low to middle-income earners), they will receive the one-off bonus to offset the depredations of the global downturn. Students are eligible if they are currently on Youth Allowance, Austudy, ABSTUDY, or a similar payment.
For struggling students, $950 is nothing to be sniffed at. While the stimulus package is still being debated in the Senate, the bonus has generally been praised by tertiary institutions and student groups. La Trobe University quickly issued a press release in favour of the proposed bonus. National Union of Students President, David Barrow, said that "students across the country breathed a sigh of relief at the announcement of a one-off payment for educational costs", but he added that "[they]know that the long-term financial hardship they face remains".
Barrow’s statements reflect what is at stake here. Although the bonus is welcome, it is only a drop in the ocean when it comes to tackling the problem of student poverty. And while the Rudd Government has indicated that it recognises student poverty as an issue, it has — one year into office — so far limited itself to short-term initiatives.
Last week, the Herald Sun reported that the Government was going to fast-track a Community Corps program, whereby university students who volunteer for a range of community services will receive discount vouchers on their HECS. At first glance, the program seems admirable enough, not to mention politically astute. Combining a call to civic responsibility with an offer to alleviate students’ financial burdens, it ostensibly satisfies a broad spectrum of society — not only struggling students and desperate community service operators in need of volunteers, but also all those engaged in social and environmental issues.
But the program (whose implementation the Government has since refused to confirm) attracted criticism for trivialising the issue of student poverty. As the Herald Sun article noted, Professor Bruce Chapman, pioneer of HECS, criticised the program, pointing out that its most likely participants will already be quite wealthy. University of Sydney SRC President, Noah White, called the program "upper-class welfare", pointing out that students who require financial assistance cannot afford to do community volunteering since they spend their spare time working to support themselves through their studies.
Part of the problem with the Community Corps program is that it was developed without consultation with either universities or student groups, leaving the Government open to the criticism that its approach to students’ financial distress is cursory at best. In fact, the idea for it emerged from Rudd’s 2020 Summit held last year.
But a larger, more enduring problem is that the Government has failed to distinguish between two kinds of financial distress burdening students. On the one hand, there is existing poverty, as students struggle on a weekly basis to make ends meet, and on the other hand, there is the burden of accrued HECS debt that students must confront upon graduation and entry into the full-time workforce.
Initiatives like the Community Corps may offer HECS debt relief, but they give students no assistance with the ongoing financial difficulties they encounter while at university. Few students in straitened circumstances will want to put aside precious hours and the potential to earn income in the present in order to participate in a volunteer program that enables them to chip away at their HECS debt in the future.
According to NUS, one in eight students regularly misses meals due to financial constraints. Most students will work an average of 16 hours on top of their studies, which, apart from the problem of their pecuniary difficulties, inevitably impacts on their academic work. As a sometime tutor at the University of Sydney, I can attest to the way heavy workloads eat into conscientious students’ private study and preparation time for seminars, essays, and exams.
If the Government is serious about tackling the issue of student poverty, it cannot restrict its efforts to HECS debt relief alone. It must also take into consideration the student income support system. In fact, this must be the central platform for a full-scale approach to alleviating student poverty. Youth Allowance has not been updated since the early 1990s. According to current estimates, Youth Allowance payments are, at their maximum, 40 per cent below the Henderson poverty line. The system is out of date and out of touch with the needs of the clientele it is meant to be serving. As White writes in an address to first-year students in 2009 at the University of Sydney, the student income support system is "a 20th century relic out of touch with living and housing costs in the 21st century". While the Teaching and Learning Bonus props up students with a welcome supplement to their income support payments, it does not resolve the ongoing problem of the support system’s own obsoleteness.
Student income support has been allowed to lag by successive federal governments. And student poverty goes largely unnoticed in society at large. When it is acknowledged, it tends to be dismissed as a character-building rite of passage, difficult to get through but not excessively so. Last December, Sydney Morning Herald economist Ross Gittins declared that he had little sympathy for students who, he claimed, were "self-pitying", "pretending to be poor and deserving". University students tend to come, he explained, from middle-class families, and as such are surrounded by people on whom they can rely for financial support. Drawing on estimates produced by Professor Chapman, Gittins suggested that student poverty was in some way justified by evidence that university students’ lifetime earning capacity was 70 per cent greater than that of individuals who only went to Year 12.
What Gittins did not ask, however, was: why do universities tend to be the preserve of the middle classes? What financial barriers prevent people from lower socio-economic backgrounds from participating in higher education? In what ways does the student income support system, in its current dismal state, serve as a barrier to successful tertiary participation when it should be providing much-needed financial assistance?
Gittins, unquestioningly accepting the status quo that universities are predominantly middle-class, treats student income support as a redundant measure that props up students who don’t really need the assistance in the first place. In dismissing student poverty so easily, and in failing to recognise that existing student poverty and the burden of HECS debts upon graduation are two separate issues, he commits the same error as the Government in failing to address the distinction between the need to reform the student income support scheme and the need to provide students with HECS debt relief. But he also misses the opportunity to open up the issue of student poverty to wider debate. Reform of the income support system would not only alleviate the distress of current students (middle-class or not); it would also enable prospective students from poorer backgrounds to attend university.
Students from poorer backgrounds are the ones media commentators like Gittins routinely overlook. They are also the ones who are most in need of the largesse offered by programs like the Community Corps, yet they will not be the likely beneficiaries of such schemes. While they would benefit from the Teaching and Learning Bonus, they could not depend on Youth Allowance or similar payments to support them through their studies. If the Government is committed to its proposed education revolution, it must begin to talk about reform of the student income support system. In this respect, the immediate challenges of addressing the global financial downturn need not hinder genuine long-term reform.
It is striking that, while Kevin Rudd and Wayne Swan’s economic stimulus package offers one-off payments to individual students, Barack Obama’s proposed stimulus package, currently being debated in Congress, injects money into the infrastructure that provides students in the US with financial assistance. As the New York Times reported earlier this week, the US stimulus package directs funds to banks specifically for the purpose of student lending. It is time for the Australian Government to review the infrastructure for student income support too.
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