Nursing, teaching, midwifery and social work students will be eligible for a $320 a week payment in a bid to ease the burden of unpaid placements.
A day after revealing it will wipe $3bn worth of student debts, Labor on Monday revealed its plan to tackle “placement poverty” as it sharpens its re-election pitch to younger voters.
The payment, which will be benchmarked to the single Austudy per week rate, is expected to help about 68,000 university students and 5000 VET students annually.
But the scheme won’t start until July 1 next year and not all students will be eligible.
It will be means-tested and paid in addition to any income support the student may already receive.
Education Minister Jason Clare said it would help students who are struggling to pay the bills to be able to finish their courses.
“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 uni, but they can’t afford to do the prac.
“Some students say prac means they have to give up their part-time job, and that they don’t have the money to pay the bills.”
A “prac payment” was a key recommendation of a recent review into the university sector.
The Universities Accord said “onerous hours” required by mandatory placements can financially disadvantage students who are unable to participate in paid work while on placement.
National Union of Students president Ngaire Bogemann described the scheme as a “massive win” for uni students.
“I’ve heard horror stories of nursing students, of students doing placements having to live in their cars while they’re undertaking full-time unpaid work. This is just relief for students,” she told the ABC.
It comes after Labor announced it would cap student loan indexation to the lower of the consumer price index or the wage price index.
The changes, which require legislation, will be backdated to June 1 last year and are estimated to save the average graduate $1200 on their total debt.
A total of $3bn will be wiped off the debts of more than 3 million Australians with HECS debts.
Mr Clare said he had heard the pleas of students loud and clear “and that’s why we’re responding”.
“What it means is that it cuts their debt and it means that they’ll be able to pay off that debt sooner,” he said.