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Student Allowance parental income threshold frozen

Hon Steven Joyce
Minister for Tertiary Education, Skills & Employment
29 March 2012 Media Statement
Student Allowance parental income threshold frozen in 2012

Tertiary Education, Skills and Employment Minister Steven Joyce has announced today that there will be no increase to the student allowance parental income threshold this year.

Student allowance rates and student loans living costs will be increased by 1.77 percent on 1 April 2012 as part of the 2012 Annual General Adjustment.

“Freezing the threshold at current levels is the first step in curbing the major expenditure increase in student allowances over the last few years as we look to better target this support to students who need it most,” Mr Joyce says.

“Government expenditure on student allowances has increased from $385 million in 2007/08 to $620 million in 2010/11: a 62 per cent increase. Part of this increase can be attributed to significant increases to the student allowance parental income threshold in the 2000s.

“The student allowance parental income threshold has increased well ahead of wage growth and inflation. In 1992, the threshold was $26,832, which is $42,049 in 2011 dollars. This compares to the current threshold of $55,026.”

In the current tight fiscal climate, there is a need to control this increase in expenditure to ensure that allowances remain affordable as a source of support for low-income students.

Freezing the threshold will affect approximately 1,500 students over four years from families with incomes above $82,000 who would have been eligible for a partial allowance if the threshold had continued to increase.

“Continuing to improve the performance of student support lets us invest further in our tertiary education priorities including research, science and the Youth Guarantee,” Mr Joyce says.


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