Chapter 4 - Effect of income support measures on students
The test of student income arrangements is whether they
effectively reduce the need for students to work excessive hours and so avert
the detrimental effect on academic performance of heavy work commitments
prompted by economic necessity.[151]
4.1
An important issue for the committee is the effect of
current income support arrangements on students and their families. This
chapter tackles the issue from two different angles. First, it examines an upward
trend of full-time students working longer hours in part-time employment to financially
support themselves, and the adverse effect on their study habits, academic
progress and retention in higher education. Second, it examines the increasing
cost of higher education and its effect on student finances. The financial strain
on students is affected by the rising cost of higher education, livings costs
and spiralling student debt. The cancellation of a number of loan schemes,
emergency finance schemes and other subsidised financial assistance to students,
among them the Student Financial Supplement and Educational Textbook Subsidy
Schemes, has come at a time when many students are already experiencing severe
financial hardship.
4.2
To these effects must be added those of the Government's
voluntary student unionism legislation, which was introduced into the Parliament
mid-way through the inquiry. The committee notes that students and university
administrators raised concerns about the legislation in the context of
students' worsening financial situation. It was argued that the support that
university student organisations provide to students in the form of health,
education, financial and other services will be severely eroded if the
legislation is passed.
4.3
Students are finding it increasingly difficult to
support themselves financially under current income support arrangements. The
situation is compounded by the stringent eligibility criteria which have made
it more difficult for students to participate in higher education, especially
students from remote and regional areas. Supplementing income support payments with
paid employment is no longer an added extra for many students. Part-time work
has become a necessity for students just to make ends meet. They are working
longer hours than before to the detriment of their studies and their overall
experience of university. The committee believes the financial situation of
many students under the policies of the Howard Government is grim, and that the
evidence presented to the committee during the inquiry shows that it has
deteriorated even further over the past few years.
Balancing work and study
4.4
An increasing proportion of students need to supplement
their income with paid employment of one kind or another. The trend of students
working longer hours in part-time or casual employment is demonstrated by the
findings of academic studies and surveys. Professor
Craig McInnis
and the Australian Vice-Chancellors' Committee among others have provided
evidence of how the profile of students has changed considerably over the past
decade. More students balancing their studies with part-time work is the most
consistent finding. McInnis has recently observed that anecdotal reports of
students working more and studying less have been coming from academics in Australia
with particular intensity and frustration in recent times.[152] The trend of increasing hours of
part-time work is also mirrored in other education systems, especially the United
States, the United
Kingdom and France.
4.5
The committee notes a more fundamental shift in the
relationship between students and universities: a higher level of student
disengagement from university life as well as new forms of student engagement.
McInnis has concluded that a large number of full-time enrolled students have
become de facto part-time students: 'Leaving aside the growing impact of
part-time work on their everyday commitment to their studies, students have in
any case less need to spend time on campus in order to study, or to have access
to teaching and learning resources'.[153]
The issue for universities is their role in defining the nature of the
undergraduate experience and whether they can shape and control that
experience.[154]
4.6
The trend of students working longer hours in part-time
work has coincided with major changes in the needs and expectations of a
generation of undergraduate students. Students today generally find it more
difficult to motivate themselves to study and spend less time on tasks that
would improve their learning. They rely on part-time work as the sole or main
source of independent income, are less likely to study on weekends, and are more
likely to borrow course materials from friends to meet deadlines or to catch up
on classes missed. There is also evidence that students do not view being on campus
or in tutorials as critical to the quality of the experience of university or
vital to their academic success.[155]
Summary of the evidence
4.7
Evidence before the committee showed overwhelmingly
that tightening of eligibility criteria for income support payments in the late
1990s and erosion of the maximum level of income support relative to the
official poverty line have resulted in more students in part-time employment to
pay for the cost of their study.[156]
This is borne out by a number of studies and reports which have examined the
patterns of employment by full-time students.
4.8
An analysis of trends in the perceptions and behaviours
of first year undergraduate students by academics from the Centre for the Study
of Higher Education, University of Melbourne,
charted the major patterns of stability and change in the experiences and
expectations of first year students over the previous decade.[157] The report found that the proportion
of students engaged in part-time and casual employment and the number of
students who rely on paid work as a source of income changed considerably
between 1994 and 2000. Over this period, there was a nine per cent increase in
the proportion of full-time students who work part-time and a 14 per cent
increase in the mean number of hours they work. There was also a significant
increase in the number of first year students who reported part-time or casual
employment as their main source of income.[158]
4.9
The latest report from the Centre for the Study of
Higher Education, published in January 2005, builds on these earlier figures by
providing information on the changes over a ten year period in the attitudes
and experiences of first year students. The authors found that over the decade
from 1994 to 2004 full-time students were spending progressively fewer days on
average on campus and reduced hours in class in each week (17.6 hours per week
in 1994 compared with 15.9 hours per week in 2004). This trend is accompanied
by a significant rise in the proportion of full-time students in paid employment
(47 per cent in 1994 compared with 55 per cent in 2004).[159]
4.10
The findings of the 2000 and 2005 studies are consistent
with the results of a major survey of undergraduate university student finances
conducted by the Australian Vice-Chancellors' Committee (AVCC) in 2000, and
published in October 2001 under the title Paying
Their Way.[160] The report's main
findings were that more students are employed, they are employed for more hours
and their employment is more distributed throughout the year. It drew attention
to the danger that the increase in paid employment of university students has
interfered with their study.[161]
4.11
Although the figures in the AVCC's report are now somewhat
dated, they provide the most complete picture of the extent to which students need
to work to survive. The survey found a significant increase in both the number
of students in employment and the average number of hours of work compared with
the findings of a comparable survey published in 1984. Significantly, the
incidence of paid work during semester had increased by around 50 per cent, with
72.5 per cent of all full-time students in employment during semester. The
survey also found that the average number of hours worked each week had
increased from five hours a week in 1984 to 14.5 hours in 2000. The figures
showed conclusively that not only are more students in employment during
semester, they are also working longer hours – nearly three times the number of
hours worked each week compared with full-time undergraduate students in 1984. The
report's executive summary concluded:
Between 1984 and 2000 the combination of the increase in the
incidence of paid employment and the increase in the average hours of work for
those in paid employment has resulted in a more than four-fold increase for
full-time students in the 'burden' of paid employment.[162]
4.12
Recent evidence from the University
of Canberra suggests that there is
a steady increase in the number of hours in which students are in part-time
work. The Vice-Chancellor, Professor Roger
Dean, told the committee
that full-time students at the University
of Canberra work an average 20.9
hours each week, which is a significant increase on the national figure of 14.5
hours reported in Paying Their Way.[163] The figures reported by Professor
Dean are based on the findings of a survey of the effect of paid work on the
academic performance of students at the University
of Canberra. The survey's authors, Craig
Applegate and Anne
Daly, found that the average student spent
12.7 hours per week in class contact, 11.5 hours per week in extra-curricular
activities outside direct class contact hours and a staggering 20.9 hours in
paid employment. They noted that 95 per cent of respondents who worked said the
primary motivation for working was to earn income, with employment accounting
for approximately 60 per cent of their total income.[164]
4.13
The committee has reason to believe that the University
of Canberra survey findings represent
a broader trend in student employment across all university campuses. The results
of an undergraduate student welfare survey conducted in January 2005 by Sydney
University's Students' Representative
Council confirm that significant numbers of students are working between 15 and
20 hours each week. The survey of 1057 students at the University
of Sydney found that 85 per cent of
respondents said they were in paid employment, of which 62 per cent worked
regularly during semester.[165] The
most common number of hours worked fell within the range of 10 to 15 hours per
week, the equivalent of two day shifts or 3 casual night shifts. The survey
also found that at least 68 per cent of students with regular or irregular work
during semester were working more than 9 hours each week, rising to 40 per cent
of students who were working more than 14 hours each week during semester.[166]
Recommendation 12
The committee
recommends that the Government, in consultation with the Australian
Vice-Chancellors' Committee and student organisations, undertake regular
five-year surveys of student finances and work patterns as per the AVCC's Paying Their Way report (2001). These
surveys must include a review of all ancillary fees.
Government senators do not agree with this recommendation.
Effect of work on academic
performance
4.14
The rising level of interest in the financial
conditions of undergraduate students in Australia
and overseas has been prompted by concern about the declining academic
performance of students.[167] The 2000
report by McInnis, James and Hartley made a
number of preliminary findings in relation to the effect of work on academic
performance. The report findings suggested a trend of less attachment and
commitment to a range of aspects of university life and academic work on the
part of those who work long hours in paid employment. It also found a slight
but noteworthy decline in motivation to study. The authors concluded that these
trends require closer investigation.[168]
4.15
The study by McInnis and Hartley in 2002 researched
this topic in detail. A substantial number of respondents reported financial
concerns and stress from studying and working. The study found that 40 per cent
acknowledged that paid work is disruptive of academic studies, and 34 per cent said
that worrying about money made it difficult to concentrate on their studies.[169] The issue was also examined in the
AVCC's Paying Their Way report, the
findings of which mirrored those by McInnis and Hartley. While the report cautioned
that the interpretation of data on the impact of work on study is complex, the
hours a student works during the semester clearly has a major influence on the student's
academic work: '...the more hours of work, the greater the adverse effect on
study'.[170]
4.16
The report found that three out of every 20
undergraduate students in Australian universities, or some 71,000 students,
reported that their studies are affected 'a great deal' by their employment
during semester. In addition, 43.5 per cent or 220,000 students reported that
study is adversely affected 'somewhat' because of their hours of work. Also
revealing is that seven per cent of students 'frequently' missed classes. The
Sydney University' Students' Representative Council survey of January 2005
found that 61 per cent of respondents indicated that work adversely affected
their study.[171]
4.17
The University
of Canberra survey by Applegate and
Daly produced some mixed findings on the effect of hours of
paid employment on academic performance. They found that the effect of work varies
with the number of hours involved:
Working up to about eleven hours per week improves marks
marginally...However, the beneficial effects of paid employment appear to decline
after 11 hours of work and the effect is estimated to become negative after 22
hours of paid employment.[172]
4.18
The survey concluded that some paid employment improves
academic performance, perhaps by encouraging good time-management skills. More
than 11 hours of part-time work, however, was found to have had a small but
negative effect on average marks. Working more than 20 hours each week had a
substantial negative effect on students' academic performance.
4.19
The committee received anecdotal evidence that the
increasing pressure on students to undertake work in order to survive is having
a detrimental effect on their studies. Students in part-time work would once be
required to work in the evenings, on weekends and during non-teaching periods.
The situation today is very different. Students take jobs during normal
business hours on week days and at times which compete directly with the normal
scheduling of classes.[173] The
National Union of Students (NUS) told the committee that students who work 15
or 20 hours each week engage only in 'shallow learning' in order to receive
their degree, rather than in wider academic pursuits. The NUS submission
concluded that excessive hours of work:
...is a significant disruption to their education as well as their
personal well being. As well as limiting students' ability to reap the full
benefit from the courses they are undertaking, students being forced to work
long hours in order to support themselves negatively impacts on the broader
gains that higher education brings to our culture.[174]
4.20
The committee is concerned by another effect of
employment. Students are taking longer to complete their courses as a result of
working longer hours. This delays their entry into the workforce, sometime by
several years. There was anecdotal evidence from the University
of Adelaide that students across
all faculties are requesting extensions to submission deadlines and other
special considerations more frequently than in the past as a result of
financial pressures and the need to maintain outside employment.[175]
4.21
There has also been a significant change in the way
students approach their studies. According to the Student Financial Advisers
Network, there is a tend for students working long hours to commit only the minimum
amount of time and effort to their studies:
We see a lot of students skipping classes. Any lecturer will
tell you that attendance at lectures is down. Students are now relying on
downloading lecture notes from the internet and reading them at home. Students
are targeting those areas they think will give them the most benefit. They are
only studying those areas that are likely to appear on exams and they are
concentrating on assessment task.[176]
4.22
This assessment is consistent with the conclusion
reached by McInnis, that first year students who work long hours in part-time
work are less likely to work with other students completing the same courses,
and more likely to have studied inconsistently through the semester. These
students also tend to anticipate getting lower marks, and are more likely to
seriously consider deferring at an early point during their course.[177]
4.23
Students are spending less time on campus, partly as a
result of employment, which means they are missing out on the experience of
university life. While surveys by McInnis and Hartley found that university is
only a small part of students' lives and that students only spend the hours
they have to on campus, the on-campus experience of full-time enrolled working
students suffers as a result: 'Many [students] have little sense of the
richness that a campus-based experience can offer...The rational decision they
make to get through a course while working sometimes excessive hours means
losing opportunities for close engagement with the learning process'.[178] The conclusion is supported by the
observations of a number of student associations:
I think the majority of students want [the holistic experience],
but they are unable to take it up because they are spending their time working
rather than being at university studying and getting involved in all the
extracurricular activities, challenging ideas, and the whole purpose for which
universities are there.[179]
...students felt that they had 'missed out on a whole segment of
university life' by having to rush to work from lectures and tutorials.
Essentially, students felt unable to become involved in university
life...Students thrive on diversity; however the escalating need to work longer
hours while maintaining study commitments is impinging upon this freedom.[180]
4.24
While most of the evidence related to the effect of
employment on academic performance, the committee is concerned by evidence that
balancing work and study commitments effects students' quality of life and
health. A survey of university students in inner city and metropolitan Melbourne
in 2001-02 by Professor Judith
Bessant, confirmed anecdotal and media
reports that students were putting not only their studies but also their health
at risk by working long hours. Students who took part in the survey by Bessant commented
on always feeling tired in their attempts to combine work and study, lacking
sleep, finding it hard to concentrate, feeling rushed and having no time to
relax with family and friends.[181]
The nature of part-time work
4.25
While part-time work is now an economic necessity for
many students, it is rare for undergraduate students to be able to find
employment opportunities related to their area of study. According to the University
of South Australia, this situation
creates a '...disjunction between study and the rest of the student's life, and
works against providing students with work-related learning experiences'.[182] The committee heard numerous
accounts of students being compelled to work in low-paid jobs, with many increasingly
resorting to the so-called black economy, or cash in hand jobs, as their main
source of income.[183] The hospitality
and retail sectors are often associated with this form of work. While there is
little data or information on the unregulated work that students undertake, the
survey by McInnis and Hartley found that 15 per cent of respondents said that
the work they do is 'cash in hand'. It appears that the main reason why
students engage in unregulated work is the low personal income test threshold
on earnings before the Youth Allowance is effected. As Dr Dobson told the
committee: 'It is only natural that somebody is going to want to preserve their
hard-won youth allowance, especially those students who have gained it because
they have become independent'.[184] The
President of the Students' Association of the University of Adelaide, Mr David
Pearson, maintained that students do underhand cash work because '...it is cheap,
it is easy, it is off the books and so you do not have to deal with the
headaches of dealing with Centrelink'.[185]
4.26
There was also evidence that students are resorting to
product testing as a source of quick and easy cash, mostly in the form medical tests
for drugs, cigarettes, sleep deprivation and other products.[186] The committee was told that students
on campus are increasingly vulnerable to the predatory practices of companies which
aggressively market their products and services and exploit financially
vulnerable students. The Australian National University Students' Association
told the committee that flyers are frequently circulated around the ANU campus
which advertise sleep deprivation and dietary products:
There are all sorts of weird and wonderful advertisements for
medically related experiments for students to make a quick buck, for cash in
hand—it is made quite obvious. They are all over the campus and I am sure they
are all over the campuses all over the country. We have to ask ourselves what
the purpose of higher education is and in what kind of conditions we want
students to be undertaking their higher education, if this is what it is coming
to for students to make money to support themselves.[187]
4.27
The committee is concerned about reports of students pursuing
unlawful avenues of employment to earn enough money to complete their course.
There have even been reports of students turning to prostitution as a way of supplementing
their income, an issue which raises serious moral, health and safety concerns.[188]
Discussion
4.28
The committee finds that students are working unacceptably
long hours in part-time employment to the extent that many students enrolled in
full-time courses are beginning to closely resemble part-time students in their
study habits, the level of their interaction with other students and teaching
staff and their paid work activities. The latest empirical research, which is backed
by a large amount of anecdotal evidence, shows a consistent increase in the number
of hours students work each week and a corresponding decline in the level of
student engagement with studies and other on-campus activities. The committee
is concerned that if this trend is not reversed, it will only be a matter of
time before a combined weekly total of 60 hours of study and work is the norm
for all full-time students. The committee believes this situation is
unacceptable, placing enormous pressures on students and their families. Working
more than 11 hours a week is known to have a detrimental effect on academic achievement
and the overall quality of the student experience at university. Students are
less able than before to engage in the full range of university activities, of
which the need to work longer hours is arguably the most important reason.
4.29
This situation creates a major policy challenge for university
administrators. They are required to provide flexible arrangements for
delivering courses to enable people to work. The RMIT Student Union submission
noted that the social shift taking place in universities has resulted in a core
change to the development and delivery of post-secondary education: 'Curriculum
developers and academic teaching staff are increasingly having to consider
students' financial situations in the development and administration of their
courses'.[189] As one vice-chancellor
told the committee: 'It is not a minority that you have to accommodate; it is
the majority'.[190] The committee
believes strongly that the Government has a responsibility to provide students
with adequate financial support to enable them to engage properly with their
studies and with the life of the university more generally. The committee
believes further that the Government and university administrators have a joint
responsibility to manage the new realities of student financial hardship and
student disengagement.
4.30
Discussion of the effect of paid employment on the
academic performance of students feeds directly into, and reinforces, one of the
committee's earlier findings – that the current level of income support for
students is grossly inadequate, having fallen between 30 and 50 per cent below
the official poverty line. Consideration should be given to providing a level
of financial support to encourage students to study full-time and complete
courses within the required time without the need to work 15 or 20 hours each
week. The committee notes the view of Professor
Anne Edwards
that while the philosophy of income support should not deter people from
entering the workforce, full-time students should receive sufficient financial
support to enable them not to have work at all:
The incentive ought to be to try and ensure that the levels of
income support are sufficient to ensure that students do not take such a lot of
part-time work that they delay the process by which they can complete their
studies. The best incentive would be to provide sufficient money to allow most
students who are on income support not to have to work at all. They could then
study full time and get out in three years or four years, rather than dragging
their studies out over five years.[191]
4.31
The committee does not take issue with students who
decide to work part-time as a way of supplementing their income support payment.
The important issue is not whether students as a matter of principle should be working
while studying, but the imbalance created by students working excessive hours
each week just to survive. Student bodies told the committee that students are
not opposed to work as they do not expect to be completely self-sufficient, or to
'live like kings' as one student representative put it.[192] However, financial support is necessary
to prevent students jeopardising their studies and being forced to give
priority to employment. The committee accepts that students who find the right
balance of work and study can reap social and economic benefits and acquire the
skills to meet the demands of entering the workforce upon the completion of study.
There is no denying that employers increasingly expect that graduates can
provide evidence of consistent paid work experience.[193]
Recommendation 13
The committee
recommends that the Department of Education, Science and Training undertake an
analysis of the costs and benefits associated with a comprehensive student
income support payment which is separate from the existing Youth Allowance and
which provides financial assistance to students for the duration of their
course.
Government senators do not agree with this recommendation.
Concluding comment
4.32
The evidence to this inquiry overwhelmingly supports
the view that providing appropriate financial incentives for students to reduce
their hours in employment should be government policy. The committee agrees
with the AVCC's recommendation to the Government's review of higher education,
that the Government should restructure the student income support system to
reduce the need for students to work excessive hours.[194] The committee urges the Government
to take immediate steps to address the AVVC's concerns. The committee believes
that reducing student's reliance on employment will have positive effects on
academic performance and student engagement with university life. It will also
have an economic benefit resulting from students completing their course on
time and entering the workforce more quickly than at present.
Cost of higher education
4.33
Australian has one of the least affordable higher
education systems in the world. A recent Educational Policy Institute study of
the relative affordability and accessibility of university education in a
number of OECD countries ranked Australia
as one of the highest fee-charging countries in the world, along with Japan,
Chile, New
Zealand, the United
Kingdom and the United
States.[195]
4.34
Not only is university becoming less affordable, the
level of investment in higher education by the Commonwealth Government has been
declining for some time. The Students' Association of the University of
Adelaide submission estimated that the real value of university operating funds
allocated by the Commonwealth Government has decreased to such an extent it has
resulted in universities losing 20 hours of tutorial assistance per student and
10 hours of lecture time per student each year, as well as a teacher/student
ratio of one in one hundred.[196]
4.35
The committee received overwhelming evidence that many
aspiring students are being priced out of the higher education market, which is
compromising the principle that merit should underpin university entrance. The
trend which the committee examined in previous sections – of a decline in
student participation in campus activities and of a higher proportion of
students working longer hours – is a natural extension of a 'user-pays' education
policy which has increased the financial burden on individual students.
Students are increasingly bearing the brunt of a decline in public funding for
education and a more restrictive social security system.[197]
4.36
The introduction of differential HECS payments has
roughly doubled the cost incurred by students and the further deregulation of
HECS means that many students pay an extra 25 per cent of the cost of their
education. The introduction of loan schemes such as PELS and FEE-HELP has
allowed some universities to significantly increase their postgraduate
coursework fees. According to the NUS, this has resulted in students now
funding over 40 per cent of the running costs of universities.[198]
Closure of the Student Financial
Supplement Scheme
4.37
The Student Financial Supplement Scheme (SFSS), which ran
from 1993 until 1 January 2004,
was widely known in its early years as the Austudy/ABSTUDY supplement. However,
after the program moved to the Department of Family and Community Services it
was renamed the SFSS. Under the scheme, category one loans of up to $7000 per
annum were made available to Youth Allowance, Pension Education Supplement,
Austudy and ABSTUDY recipients. Students were required to trade in one dollar
of their income entitlement for every two dollars of loan received. The maximum
net gain to a student's income was $3500, or $135 per fortnight. Other students
could qualify for a category two loan of up to $2000 if they were dependent and
not eligible for income support due to the parental income or family actual
means test.[199] Administered through
the Commonwealth Bank, payments did not commence for up to five years from the
time the loan was taken out, after which it was collected through a HECS-style
arrangement, the threshold for which in 2003 was $34,494.[200]
4.38
The SFSS was accessed by up to 60,000 students at a
cost of approximately $2.5 billion, with most loans being provided between 1995
and 1999.[201] Data provided by the
Government in 2003 indicated that the major groups in receipt of loans under
the scheme were low income earners (single parents, disabled and indigenous
students) who could no longer reasonably ask to be supplemented by their
parents or who faced other constraints in the labour market. It became clear
that the SFSS was being accessed by the most financially vulnerable members of
the student body without which they would not be able to complete their
studies.[202] The NUS told the committee
that poor students who were accessing the scheme were receiving high private
returns from the education system, notwithstanding that nearly 55 per cent of
loans were not being repaid.[203] The
scheme, however, was widely considered to be a regressive debt trap with an
average loan amount of $20,000, occasionally rising to $60,000.[204]
4.39
Most submissions were critical of the way the scheme
was structured and implemented. The NUS argued that the absence of any sunset
provision was a major weakness because students who had arranged their lives
around access to the SFSS were 'left high and dry' half way through their
degree.[205] While the scheme's many
faults were highlighted in the written submissions, there was ambivalence among
student bodies towards the closure of the scheme without any warning being
given to affected students and without parliamentary approval.[206] There was broad agreement that
abolishing the SFSS without a replacement loan scheme or an increase in the
level of income support would place many students under severe financial stress
and in a situation of having to withdraw from university.[207] There was concern that students
would resort to taking out commercial loans with higher interest rates or more
hours in part-time work.[208]
4.40
The National Indigenous Postgraduate Association
Aboriginal Corporation argued that the scheme should not have been closed
without the introduction of an interest-free alternative. The sudden closure of
the scheme left many of the 4000 indigenous students, or over 15 per cent of
SFSS recipients who had accessed loans, in a difficult financial situation.[209] Other submissions supported the idea
of an income contingent loan scheme that would not involve students having to
trade off part of their income support payment, or making available to eligible
students a one-off compensation payment to enable students to complete their
studies.[210] According to the
Australian Council of Social Service, a one-off payment would go some way
towards relieving the financial pressure from any unanticipated reduction in the
level of assistance.[211]
4.41
Other submissions cautioned against either reinstating
or replacing the SFSS with a new loan scheme because of a concern that loan
schemes by their very nature contribute to rising student indebtedness. The University
of South Australia Students'
Association expressed the view that some students have unrealistic expectations
of graduate salaries, underestimate the time it will take to repay a
substantial debt, and do not consider that their personal life choices may be
limited after completing study as their personal debt grows. It argued that students
would not need to take out personal loans to cover daily living expenses if they
received an adequate level of income support.[212]
The University of South
Australia agreed with this position, advising
that it had closed its student loan scheme because of the increasing number of
unpaid loans, and also because of a belief that students should not have to
accumulate debt in addition to their HECS debt if adequate financial support
arrangements are in place.[213]
Recommendation 14
The committee
recommends that the Department of Education, Science and Training examine a new
income contingent loan scheme to replace the Student Financial Supplement
Scheme.
Government senators
do not agree with this recommendation.
The Democrats acknowledge the benefits provided to
students through the Student Financial Supplement Scheme, but believe it is not
an appropriate model for further consideration.
Closure of the Educational Textbook
Subsidy Scheme
4.42
Textbooks are an essential and often prohibitively
expensive item for any academic study which can impose a large financial burden
on students.[214] The price of
university textbooks can range from $80 to $500 for law or medicine.[215] The AVCC's Paying Their Way report noted that textbooks are about a quarter of
students' course costs, which probably explains why a significant number of
survey respondents conveyed 'despair and venom' at the cost of textbooks.[216] The Educational Textbook Subsidy
Scheme (ETSS) was introduced specifically to mitigate the effect of the Goods
and Services Tax (GST). The GST on books was viewed by many as a tax on
knowledge which would price some students out of an education. The purpose of
the ETSS was to give students an 8 per cent subsidy by compensating bookshops
for the GST payable on textbooks. It is estimated that the scheme provided
welcome relief in the order of $6.40 to $40 per book: 'For people living below
the poverty line, these small amounts of relief are vital'.[217] What was not clear at the time,
however, was that the Government, in agreeing to establish the ETSS to secure passage
of its GST legislation, did not commit any additional funds for the scheme
beyond 2004. Submissions from student associations expressed concern that closure
of the scheme, which took effect on 30 June 2004 mid-way during the inquiry, would
exacerbate the financial problems of students by making it harder for them to
purchase essential study material.
4.43
The committee tried to assess the impact of the
scheme's closure on student finances. Anecdotal evidence from students
associations suggested that the scheme's closure has been significantly felt by
students at universities across the country.[218]
The added cost of textbooks is being felt by students particularly at the beginning
of every semester when financial demands placed upon them often reach their
peak.[219] The Australian National
University Students' Association told the committee that the abolition of the
ETTS was a major issue for students:
Obviously the abolition of that scheme without any proportionate
compensation...severely affected students. All the evidence I have is
anecdotal...but I did talk to several students after it was abolished last year.
I went and hung around the bookshop at the beginning of the next semester and
the next term when people were buying textbooks and there was a marked
increase.[220]
I was living on campus last year when the scheme was abolished.
Before the abolition of the scheme, a number of students around my hall were in
quite a fluster and were racing down to the Co-op Bookshop to make sure they
bought their texts before the next semester. So they were definitely very aware
of the increased costs relating to textbooks, and that resulted in their buying
textbooks before they were even confirmed as the texts for the subjects they
were taking.[221]
4.44
The Flinders Postgraduate Students' Association
submission noted that between 2002 and 2004, the association had distributed
$10,000 per annum to postgraduate coursework students suffering financial
hardship. In 2003, the majority of grants awarded were apparently used to
purchase essential textbooks.[222]
Similarly, the University of South Australia Students' Association found from
its student surveys that the purchase of textbooks was the single most
burdensome cost borne by students: 'All students admitted to difficulties
buying compulsory textbooks and all students agreed that the abolition of
the...ETTS would decrease their chances of being able to do so in the future'.[223]
4.45
The committee finds that closure of the ETTS is having
a detrimental effect on students. By closing the scheme, the Government has
passed more of the essential costs of higher education on to students. Reports
that students view the purchase of textbooks as a waste of money and only purchase
books which can be used for an entire course or those with resale value, are of
particular concern: 'As a result, the majority of students reported completing
only the required readings, rarely being afforded the luxury of purchasing
"extra" readings to bolster their learning'.[224] The committee is concerned by
reports that some students at the Australian
National University,
and probably at other universities, are using emergency loans to purchase
textbooks instead of using the money to pay for rent, food and transport.[225]
Recommendation 15
The committee recommends that the Department of Education, Science and
Training undertake an analysis of the costs and benefits associated with
restoring the Educational Textbook Subsidy Scheme.
Student services and VSU
legislation
4.46
The committee heard evidence at each of the public hearings
that the financial strain placed on students following closure of the Student
Financial Supplement and Educational Textbook Subsidy schemes, especially for
those who do not receive any income support, will be magnified by the
Government's intention to push ahead with voluntary student unionism (VSU) legislation.[226] Although the VSU legislation and its
likely impact on the provision of student services are the subject of an
inquiry by the Senate's Employment, Workplace Relations and Education
Legislation Committee, the committee believes that the concerns raised in
evidence during this inquiry are relevant to its terms of reference. At the
very least, the range of services which student unions currently provide can be
seen as an important supplement to the inadequate income support provisions
which the government provides. Any reduction in the level of these services
will create more financial hardship for students. The committee is concerned by
the unintended consequences of the bill which have not have been addressed by
the Government. One example relates to the food services provided by student
unions at a number of universities, including Monash, RMIT and La Trobe, for
students who cannot afford to eat properly. The RMIT student Union told the
committee that these food services will be directly affected by the VSU
legislation, which may have major health implications for financially
struggling students.[227]
4.47
The situation facing many student-based organisations
was captured in evidence at a public hearing by the Australasian Campus Union
Managers Association (ACUMA):
There is $170 million collected from students for services on
campus, and many of those services are provided by the university, not by the
student organisation. The issue that the government has with a small proportion
of that money needs to be handled in a way that is consistent with the issues
that the government has...[T]he unintended consequences of this legislation are
going to have a fairly major impact on the services that we can provide
students.[228]
4.48
ACUMA told the committee that it was reassessing the
financial effect of VSU legislation on the services provided on campuses across
Australia,
including subsidies to child-care centres, dental and legal aid services, and assistance
with accommodation. This process will include a national survey to assess the
impact of the VSU legislation. ACUMA described the support mechanisms which
student-based organisations provide as 'part of the hidden glue that keeps
universities working', a view echoed by the Students' Association of the University
of Adelaide: 'the erosion of
support for students will eat away at the intellectual landscape of what we are
struggling to call a "clever country'".[229]
4.49
Witnesses raised other concerns with the proposed VSU
legislation. It was argued that the legislation in its current form will have a
major impact on the services which financially struggling students receive on
campus, especially students on low incomes, from rural and regional areas and
international students. The NUS argued that many emergency loan and finance
schemes, as well as the on-campus welfare, counselling and financial assistance
services, will probably be abolished if the legislation is passed: '...under VSU
a lot of the emergency schemes which students currently rely on due to the
inadequacy of student income support would be lost. This is an issue that
really does need to be taken seriously...because it is going to get worse'.[230]
4.50
The NUS also emphasised that not only do student
organisations provide a range of services which would otherwise be unavailable
to students, they also fulfil a valuable welfare role by being a direct
reporting mechanism to university administrators on welfare or occupational
health and safety issues:
Student organisations provide a direct reporting mechanism so
that students can come into a student organisation, give anonymous evidence to
advocates or student representatives and have an issue reported to the
university promptly and through official channels. That is the way it should
be, that is the way we would like it to stay and that is part of the way that
Australian universities maintain quality of teaching and learning.[231]
4.51
The committee notes that the financial pressures which
are likely to result from the VSU legislation will have an adverse effect on
academic performance and the ability of students to complete courses. The
Deakin University Student Association told the committee that RMIT and Melbourne
universities had surveyed the relationship between the networking that students
do at university and retention rates. The survey results show a direct
correlation between how effectively students maintain their social networks at
university and how well they finish their course:
So activities like the orientation weeks and the clubs and
societies that are provided by unions, guilds and associations are a very important
part of keeping students at universities. If they are not paid for in some way
or if they are undermined in some way then that will have a direct effect on
the ability of students to complete their courses.[232]
Ancillary fees
4.52
The Council of Australian Postgraduate Associations'
submission drew the committee's attention to the financial stress caused by
students having to fund fieldwork trips, overseas travel for conferences and
research, and sometimes their own research equipment. It was pointed out that universities
rarely provide funding for these ancillary fees.[233] The rising cost of photocopying was
also raised with the committee as an area of concern. Loans approved by some
postgraduate student associations are being used for photocopying instead of
textbook purchases, which was their original purpose.[234] The committee was told that while many
universities allocate to up to $200 a year to each research higher degree
student for the ancillary costs of pursuing research, the money '...does not go
very far and students end up investing a considerable amount of money to manage
and complete their studies'.[235]
4.53
It appears that undergraduate and postgraduate students
are having to cover the cost of ancillary fees, which is adding more to the
cost of living and placing further strain on the income support payments. The
University of South Australia Students' Association submission described how
students are spending up to $25 dollars each fortnight on ancillary costs such
as printing, photocopying and stationery: 'To the average earner, this amount
may seem small, however students reflected on the added strain such costs put
on their already tight finances'.[236]
The Association was critical of the government for being blind to additional
course costs that students are obliged to pay to complete their course:
Such costs include, but are not limited to: the costs of video
production, camp costs – accommodation and food – professional printing (ink
cartridges and high quality paper), protective clothing such as lab coats,
uniforms for placement, the purchasing of case studies, readers and
professional presentation of documents such as binding.[237]
4.54
The Students' Association of the University
of Adelaide told the committee that
it had met with the university administration on at least two occasions to
discuss the issue of ancillary fees. Apparently, the university set up a
working party to review implementation of its ancillary fee policy. A major
issue for the students' association is students' access to course outlines. University
policy is that students have access to the outlines free of charge; however, lecturers
are beginning to include the outline in their reading bricks which students
have to purchase at a cost of up to $40.[238]
Senator Trish Crossin
Chair
Senator Natasha Stott Despoja
Senator Judith Troeth
Navigation: Previous Page | Contents | Next Page