Starting in July 2025, university and TAFE students who complete mandatory placements studying courses like teaching, nursing, social work, and midwifery will receive payments of over $300 a week during the duration of their placements.
The payments will be means tested and will be paid on top of any other existing income support students receive.
The policy will cost an estimated $23.3 million a week for over 73,000 students across universities and vocational colleges.
This is the second major budget announcement targeting the tertiary sector after it broke yesterday that the government would change the way HECS debt was indexed. Rather than indexing payments to the Consumer Price Index (CPI), wage growth will be used instead.
Labor is targeting young voters as it attempts to deliver a second budget surplus while providing cost of living support to people in a way that does not drive up inflation.
It was also revealed today that after pressure from the Greens and crossbench that high HECS debts were making it difficult for young people to secure home loans, the government has written to the Australian Banking Association asking the representative body to disclose how banks take HECS into account.
Paying students who undertake placements was a central recommendation in the University Accord Report which argued that students undertaking essential degrees needed to be supported so they didn’t “fall into poverty.”
The Accord Report also called on the government to repeal the Morrison government’s Jobs Ready Graduate program which hiked the fees of humanities degrees and change the date HECS is indexed. The government is still considering those recommendations.
Currently, tertiary students are doing hundreds of hours of unpaid labour in order to complete their degrees. Those placements are undertaken alongside course work and paid jobs.
Many students are forced to delay or defer their degrees while they save up enough money to undertake the placements. Others have dropped out entirely because they cannot afford to work full days without getting paid.
During placements, students have reported skipping meals, medication, and other bills to stay afloat.
This change to the budget comes off the back of a continued campaign by Students for Placement Poverty (SAPP) which formed last year, exposing the wider public to the struggles of placement poverty.
SAPP told Honi that these changes do not amount to paying students at least minimum wage meaning placement poverty will continue. They argued this announcement was evidence their movement was gaining significant national momentum.
“$8 an hour is a slap in the face to students who are holding up crucial industries,” a spokesperson for the group said.
“Forcing students to wait until next year for a meagre and means tested payment is a cruel election tactic that ignores the obvious urgency of the crisis.”
The Greens also argue the policy does not go far enough and have questioned the scope of the payments. They point to the announcement as evidence that pressure from the left is working.
“Who knows how many students will be screwed over by means testing. The devil is in the detail,” Deputy Leader Mehreen Faruqi said.
In a statement, Education Minister Jason Clare said that these changes were part of a broader agenda to reform the higher education system.
“This will give people who have signed up to do some of the most important jobs in this country a bit of extra help to get the qualifications they need,” he said.
“Placement poverty is a real thing. I have met students who told me they can afford to go to university, but they can’t afford to do the prac.”
