Nelson's higher education changes act to block the path out of poverty

For those Australians from poor backgrounds who can get into higher education, having a university degree is an almost guaranteed way of escaping poverty.

But unfortunately, the government's recently announced higher education package is likely to close the door on students from disadvantaged backgrounds.

The benefits of a university education are that it significantly improves the employment and earnings prospects of graduates. For example:

• Unemployment is four times higher among people who have not completed secondary school compared to those with a bachelor degree.
• Tertiary qualifications boost earnings by around 40 per cent while completing Year 12 or a TAFE qualification raises earnings by around 10 per cent.

The problem is that young people from low-income families as well as many from rural families are much less likely to aspire to a university education and obtain the benefits it provides.

Recent studies show Australians from low-income families are 50 per cent less likely to participate in higher education and rural Australians are 40 per cent less likely to go on to higher education.
Barriers to poorer students attending university are most apparent at some of the more elite universities.

The average level of enrolment of low-income students is 15 per cent across all universities, yet at ANU it is only 3.9 per cent, at the University of Sydney it is 6.3 per cent, and at the University of Melbourne it is 7.3 per cent.

Students from low-income families and also those from rural backgrounds perceive a broad range of barriers: costs of attendance, university fees, academic attainment, parental support, greater relevance of TAFE courses.

They also often have a desire to earn an income on leaving school to support themselves and their families.

Many of their families have a culture of debt-aversion - in contrast to the relatively comfortable attitude that middle and high-income families have to taking on large mortgages and loans.

While there has been little change in the under-representation of students from low-income and rural backgrounds in the past ten years, the situation is very likely to worsen under the government's proposals for a number of reasons.

With two forms of university entry - one through merit selection and the other through full-fees - we are likely to see a lower proportion of low-income students, especially at the elite universities.

The elite and research-intensive universities are most likely to increase HECS fees by the full 30 per cent and to fill a larger number of full-fee paying places.

Students from richer families will be able to enter via the back door courtesy of a big cheque.

Theoretically, poorer students now have the option of also buying themselves a full-fee paying place at university.

The Minister for Education argues that by introducing a loan scheme - FEE-HELP - for full-fee paying students he has bridged the equity gap.

But the reality is that few students from poor families would readily take on an interest-bearing debt of up to $50,000 to finance their university education.

The $50,000 cap on these loans is justifiable in the sense that it will help prevent student debt rising to ridiculous levels, but it is unfair that courses costing over this amount, such as medicine, will remain inaccessible to poor students who miss out on a HECS place.

Where a poorer student takes on a FEE-HELP loan in order to access a university place, then the even more inequitable situation will arise whereby lower-income students will be paying full fees while higher-income students will receive cheaper, interest free HECS places.

The other important dimension to undertaking a university education is the ability to be able to support oneself, or have financial support, while studying.

Forty-one per cent of high-school students from low-income families believe their families could not afford the costs of supporting them at university.

This appears to be an increasing issue for existing and potential students with a recent significant fall in the number of young students receiving Youth Allowance.

Young people in poorer families are either forgoing a university education or are delaying undertaking study until they are able to find better financial support.

The government's proposed system of merit-based scholarships to students from low-income families, and accommodation scholarships for rural students will only partly help.

These scholarships are an improvement on not having any additional support but are inadequate in terms of the number available, the value of the support, and the time at which they are provided.

There are more than 121,000 students from low-income families enrolled in our public universities.

The scholarships will only assist a fraction of these with about five out of every six poor students missing out.

And, at a rate of $2,000 a year, these scholarships still fail to bring the incomes of students receiving Youth Allowance and Austudy payments above the poverty line.

The accommodation scholarships for rural students at a rate of $4000 a year will have a more substantial impact but, again, four out of five rural students will miss out.

In any case, these scholarships are an inadequate "equity program" because they are only provided to those few disadvantaged students who continue to aspire to a university education at the end of their secondary schooling.

They are not sufficient to encourage a student to attend university, helping those who have already decided, and only those with very high academic merit.

Much more needs to be done to assist students from disadvantaged backgrounds at earlier points of their school life to encourage them to consider going on to higher education.

Other barriers relating to not having parental or peer support, unclear employment pathways, or a lack of academic confidence are ignored by the government's package.

A comprehensive approach to improving equity in our universities would also need to address some of the failings of our social security system, such as:

• Too few students from poor families being eligible for Youth Allowance because the cut-off point for parental incomes is too low.
• Low-income mature-age people who are studying to improve their job prospects receive around $80 a week less in benefits than if they are receiving unemployment benefits.
• Assistance for many jobless families actually falls during the teenage years. This adds to pressure to get work early and to forgo an education that could provide a better route out of poverty in the long run.

The government's higher education review was an opportunity to make serious inroads to the problem of social polarisation on our university campuses.

Instead, another path out of poverty for poor and disadvantaged Australians looks set to be blocked.