Australia squeezes grants

August 30, 1996

Thousands of Australia's students may be forced out of university because of a federal government decision tightening up on the financial assistance they receive.

On top of the sharp rise in tuition fees announced in this month's higher education budget, students face a severe means test to obtain Austudy - the government-financed assistance scheme.

The age at which a student is declared independent, and therefore eligible for a higher grant, has also been raised from 22 to 25.

Students immediately attacked the decisions, claiming the budget allocations to universities would destroy all semblance of equity and quality and would drive students off campuses.

Lori Faraone, president of Australian National Union of Students, said: "Only in the deluded world of this government are people dependent on their parents until 25."

She warned that the campaign of protest marches and strikes waged before the budget announcement would be a prelude to further action if the government continued with its "wanton and anti-intellectual attacks on the education system".

In presenting the conservative coalition parties' first budget to parliament, following the defeat of the long-serving Labor administration in elections last March, federal treasurer Peter Costello said the government intended to reduce Australia's underlying deficit by Aus$4 billion (Pounds 2 billion) this year and Aus$7.2 billion over two years to balance the budget during the parliamentary term.

Given that the deficit in the past year has exceeded Aus$10 billion, this suggests the government intends to achieve a further Aus$3 billion in savings in 1998/99.

The budget papers stated that the government intended to develop a standard youth allowance that would combine the current Austudy and unemployment benefit schemes.

This would standardise government aid programmes and simplify the present range of 13 different types of payments to young people.

By making Austudy for students harder to obtain, the government expects to save up to Aus$1 billion over the next four years. Increasing the age at which students qualify for the highest independent rate will alone save almost Aus$220 million by the year 2000.

The government also announced that there would be a two-year waiting period before young migrants, including those from New Zealand, could claim Austudy benefits. In an effort to crack down on exploitation by wealthy families of the Aus$1 billion-a-year assistance scheme, the family means test will also be toughened so as to generate savings of Aus$240 million over four years.

Education minister Amanda Vanstone said that providing payments to students free of a parental means test after the age of 22 did not properly reflect the obligation families had to contribute to the education of their children.

Senator Vanstone said many students from wealthy homes bypassed the family means test and that this was not equitable. The change would ensure students who were undertaking longer study were only assisted if their families were in genuine need. But students said that the changes meant the government had broken another of its pre-election promises.

Ms Faraone said the cuts were completely at odds with commitments made by Prime Minister John Howard before the March election when he said he believed strongly in Austudy and would not impose cuts.

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