The Gillard Government will make it easier for regional students to access independent Youth Allowance in legislation to be presented to Parliament next week.

As part of a $265 million package, students from inner regional areas will be able to access independent Youth Allowance under exactly the same rules that apply to students from Outer Regional, Remote and Very Remote areas.

Minister for Tertiary Education, Senator Chris Evans, said this meets the Government’s commitment, made in February this year, to eliminate regional eligibility distinctions for Youth Allowance with effect from 1 January 2012.

Recognising that students from regional areas also experience higher costs in relocating for the purposes of study, the Government will also increase the value of the Relocation Scholarship for eligible students from regional areas.

From 1 January next year, eligible regional students will receive a Relocation Scholarship of $4000 for the first year of study, $2000 for each of the second and third years, and $1000 for any subsequent years.

Senator Evans said the Government was acting in response to representations from the many Labor Members of Parliament who advocated for change on behalf of the students in their regional electorates.

The Minister also thanked the Greens and independent Members of Parliament for their strong interest and support of the Review of Student Income Support Reforms.

The Review was part of the agreement to secure passage of the 2010 student income support reforms and delivers on an agreement between the Government and the Australian Greens for an independent review to be conducted.

New figures released today show students have responded strongly to the new opportunities to access Youth Allowance following the Government’s major reforms last year. (See Attachment 1.)

“It is now clear that the Government’s 2010 reforms have delivered major increases in funding to assist students to access university education,” Senator Evans said.

“This year, total support for Youth Allowance for higher education will exceed $1.25 billion – a more than 50% increase on the $800 million outlay in the last year of the former Coalition Government.

“After a decade of stagnation under the Howard Government, we are delivering the support that Australian students need to assist them to get through uni.

“The Government’s investment in Youth Allowance is supporting the major reforms that we are making in higher education to drive improvements in productivity and ensure Australians are able to share in our economic success.”

New figures released by the Government today show the Bradley reforms are working as planned to make Youth Allowance fairer for university students: (See Attachment 2.)

• many more students from low and middle income families are accessing dependent Youth Allowance – an increase of 21 342 students;
• many more students are taking advantage of the lowering of the age of independence from 25 to 23 – an increase of 29 441 students;
• fewer students are accessing Youth Allowance through the independent workforce criterion – which is where we saw the worst rorts, with the full rate of Youth Allowance going to many students still living at home with well-off parents – a decrease of 26 141 students; and
• overall, the number of students accessing Youth Allowance is up from 135 000 to 160 000 – an increase of 18% in just more than a year.

“What these figures demonstrate is that last year’s reforms are working as intended – delivering more support to students who need it the most,” said Senator Evans.

The Government will today table in Parliament the report of the independent Review of Student Income Support Reforms, conducted by Professor Kwong Lee Dow AM.

The Government response partially adopts the recommendations of the Review and builds on them to provide additional support for students from Regional Australia who need to relocate to study.

Importantly, this new package of support will be fully funded. New expenditure will be offset from within the program, through:

• wind-up of the Rural Tertiary Hardship Fund;
• deferral of the measure to extend Youth Allowance eligibility for Masters by Coursework students from 1 January 2012 until 1 January 2014;
• reducing the value of Start-Up Scholarships to $2050 from 1 January 2012; and
• reducing the value of Relocation Scholarships for non-regional students to $4000 in the first year living away and $1000 in subsequent years from 1 January 2012.(Start-Up Scholarships and Relocation Scholarships are new benefits introduced by Labor in 2010.)

“The Government will introduce legislation next week to meet our commitment to remove regional eligibility distinctions for Youth Allowance with effect from 1 January 2012 and to build upon the success of the Government’s reforms,” said Senator Evans.

Attachment 1

Student Income Support expenditure (Higher Education) – Coalition vs Labor

Students have responded strongly to the new opportunities to access Youth Allowance.

We are now seeing significantly higher expenditure on student income support, including Youth Allowance, Start-Up Scholarships and Relocation Scholarships.

Annual expenditure is up from $800 million in the last year of the Coalition government to more than $1.25 billion this financial year.

Note: An Excel spreadsheet dataset of this information is available on request from DEEWR Media: media@deewr.gov.au

Attachment 2

Impact of the 2010 Student Income Support Reforms

Many more students from low and middle income families are accessing dependent Youth Allowance – an increase of 21 342 students.

Many more students are taking advantage of the lowering of the age of independence from 25 to 23 – an increase of 29 441 students.

Fewer students are accessing Youth Allowance through the independent workforce criterion – a decrease of 26 141 students.

Overall:

• the number of students accessing Youth Allowance is up from 135 000 to 160 000 – an increase of 18% in just more than a year
• students in regional areas have responded more strongly, with the number of regional students accessing Youth Allowance up from 28 875 to 36 310 – an increase of 25% in just more than a year

Note: An Excel spreadsheet dataset of this information is available on request from DEEWR Media: media@deewr.gov.au