Coalition to move amendments to Youth Allowance

The Coalition will move to amend the retrospective changes to Youth Allowance proposed by the Rudd Government to ensure that students currently undertaking their gap year will still receive Youth Allowance in 2010.

These students made decisions to defer their studies for a year in good faith, relying on advice from their schools' course advisers, Centrelink officials, and Government information.  Evidence given in Estimates Hearings by Departmental Officers on 3 and 4 June confirmed that these changes would effectively be retrospective in their impact on this group of students.

The Coalition is opposed to retrospective changes to legislation and will seek to amend this discrepancy, by amending the start date of the new workforce participation criteria from 1 January 2010, to 1 January 2011.

The Coalition's website www.educationforaustralia.com.au has hundreds of examples of testimony from students and parents, showing the severe impact these changes will make on opportunity for further education.

The Coalition will:

• Move amendments to the legislation so that students currently working to qualify for Youth Allowance under the existing rules will still qualify for Youth Allowance in 2010. In Senate Estimates yesterday officials from the Education Department were unable to identify the cost of this measure, but took our question on notice and we anticipate a response when the Senate resumes in a week's time. However the Budget Papers suggest that this may cost $573 million over the next four years, and we look forward to the Government clarifying the exact figure;

• Fund this extra expenditure by proposing a reduction in the start-up costs hand-outs proposed by the Rudd Government. Under the Government's Budget measure, all students in receipt of Youth Allowance will receive $2,254 (paid in two instalments). The Coalition will propose to reduce this to one payment of $1,000 (a saving to the Budget of $696 million over the next four years) except for recipients of the Veterans' Children Education scheme who would continue to receive $2,254; and

• Propose a new, effectively targeted, 'Rural and Regional Scholarship' program that will particularly assist rural and regional students who do not have the luxury of being able to stay home with their parents while pursuing further study. This measure would be initially funded at $120 million over the next four years.

The Coalition has already announced earlier this week that it will move to establish a special Senate Inquiry into the Rudd Government's changes to Youth Allowance and the challenges facing students who must live out of home to study so that changes can be made to better support disadvantaged rural and regional students.

The Coalition calls on the Rudd Government and minor Parties to support these sensible initiatives that will deliver fairness without impacting on the Budget.