On 17 March 2010 the Senate voted to pass amendments to the Government's student income support legislation, Social Security and Other Legislation Amendment (Income Support for Students) Bill 2009 [No. 2]. The key changes relating to students are summarised below.
Universities Australia continues to advocate for changes to student income support as enunciated in the Review of Australian Higher Education (the "Bradley Review"), including an increase in payment rates and broader eligibility.
While positive changes have been made, better income support levels are needed to enable both undergraduate and postgraduate students to participate in higher education without further detriment to their studies.
Universities Australia also recommends a review of legislation relating to student services and amenities, that would assist students financially throughout their studies.
Age of Independence
The Age of Independence will be progressively reduced by one year per annum, starting with a reduction to 24 years from 1 April 2010 and proceeding to 22 years from 1 January 2012.
Changes to Parental Income Test
From 1 July 2010 the Parental Income Test threshold for applicants for Youth Allowance will be raised from approximately $32,000 to approximately $43,000, to align it with the Family Tax Benefit A threshold.
Changes to Workforce Participation Criteria
From 1 July 2010 most prospective students will only be able to apply for the Independent rate of Youth Allowance based on Workforce Participation if they have worked for an average of 30 hours per week for at least 18 of the prior 24 months.
Rural Students and Workforce Participation
Rural students will be able to continue to access the old Workforce Participation independence rules (i.e. earn approximately $19,500 in the 18 months subsequent to leaving school), if they satisfy the following criteria:
- the student's family home is in a location categorised as Outer Regional Australia, Remote Australia or Very Remote Australia in the Australian Standard Geographical Classification (AGSC)
- the student is required to live away from home to study
- the student is undertaking full-time study
- the student's combined parental income for the appropriate tax year is less than $150,000 (indexed).
Commonwealth ScholarshipsFrom 1 April 2010 Student Start-Up Scholarships and Relocation Scholarships will be offered to students receiving Youth Allowance payments.In 2010 the Start-Up Scholarship will be $650 for each six months of eligible study. This amount will rise to $1,064 for each six months of eligible study in 2011 and will be indexed each year in line with the CPI. The scholarship payment for January-June 2010 will be made from 1 April 2010. From 2011, the half-yearly payments will be paid at the start of each traditional semester (i.e. 1 January and 1 July each year).
Relocation scholarships of $4,000 for first-year students and $1,000 for subsequent years will be paid to students, as per the original Bill. These scholarships will also be indexed annually in line with CPI.
Other assistance for rural and regional students
The legislation provides $20 million to establish by legislative instrument a scheme which will provide assistance for people under 25 years old to undertake higher education whose main place of residence is in a rural or regional area, or who would experience financial hardship in undertaking higher education without the assistance. There is as yet no information about what this scheme may entail.