This was published 3 months ago
Opinion
Labor’s paid placements are a slap in the face, not a saving grace
Victoria Devine
Money columnistIt’s been a big week for university students in Australia.
First, the Albanese government announced it would be wiping roughly $3 billion off student debt by lowering the HECS/HELP loan indexation rate. In real terms, this change will benefit almost 3 million Australians by saving them an average $1200 on their higher education debt.
The government’s plan to pay students $319 a week for placements is a start, but just because something is better than nothing doesn’t inherently make it good.Credit: Dionne Gain
Then, Education Minister Jason Clare announced the federal government would be introducing paid placements for students studying teaching, nursing and social work – undergraduate degrees that all require mandatory placements before students can graduate. Sounds good, right? Well, hold on because here’s where the fine print kicks in.
Unpaid placements were among the 47 recommendations handed down to the government in the recent Universities Accord report, which included 400 pages of recommendations on how to improve the higher education sector and reshape university education for the better in Australia. Among the first adopted recommendations has been the placement payments.
Perhaps the first and most glaring problem is that the payment will be just $319.50 a week. While I appreciate that it’s standard practice for graduates or interns in any industry to earn less than the average employee due to being the least experienced, a rate of roughly $8 an hour is well below the legally mandated minimum wage of $23.23 an hour, or $882 a week.
Minimum wage aside, though, there’s also the serious impracticalities of this payment to consider. The average rental property in Sydney costs $750, and $620 in Brisbane. In Adelaide, it’s $590, and in Melbourne it is $570.
If these professions are so critical, why aren’t they being recognised and remunerated accordingly from the outset?
Even if said student is calling a barely habitable share house home and paying below the median rent in their city, it’s genuinely impossible to understand how any student can be expected to make $319.50 cover a portion of rent, as well as other living expenses like food, bills, petrol, a car or public transport, and basic health needs without going into debt or living well below the poverty line.
Other problems with the placement payment model include (but are not limited to): it not being available to students until July 2025, it being means-tested, and it not extending to other degrees that have mandatory placement components.
Medical students, for example, are required to undertake 2000 placement hours, which translates to around 50 weeks. That’s almost an entire year’s work, usually expected to be undertaken on a full-time basis and often in regional or rural areas, away from your family and loved ones, for no pay.
In announcing the new scheme, Clare said the placement payment has been designed to target the most in-need education areas first, explaining: “What the Accord said is this is where we go first … they said look at teaching, early education, nursing, midwifery, as well as social work. So that’s where we’re focused first.”
Ideally, this means that over time, the payment will extend beyond these three courses, but when that happens and for which courses is still yet to be determined.
The other issue is the time in which the payment comes. I don’t know about you, but I certainly couldn’t afford to live with no salary for the required four months it takes to become a teacher, let alone an entire year, particularly in the current economic environment.
Clare said teachers, nurses and social workers had “signed up to do some of the most important jobs in this country”, and thereby implying that remunerating their months of placement was the least the government could do.
On that, he’s absolutely right. But if these professions are so critical, not just to the economy but to our society as a whole, why aren’t they being recognised and remunerated accordingly from the outset?
A 2022 report from the Australian Education Union found that once graduated, teachers rack up an average 15 hours per week of unpaid work. Research also indicates that the national teacher shortage is reaching a crisis point, with between 40 and 50 per cent of teachers now leaving the profession within the first five years.
One of the major reasons for this decision being that the cost of living well outstrips their salaries. In NSW, for example, more than 90 per cent of teaching positions are in local government areas where housing is unaffordable on a teacher’s annual salary.
By putting teachers well behind before they’ve even graduated university and entered the profession officially by asking them to live below the poverty line via the placement payment, then, is hard to square.
Nursing tells a similar story, where staff shortages are reaching a critical level, and where, according to the Australian Journal of Advanced Nursing, approximately 40 per cent of full-time nurses have taken leave from the profession, while 70 per cent of part-time nurses have done the same. As with teaching, one of the major reasons given for this decision, when asked, relates to wages.
That’s why it’s so hard to understand the government’s placement payment model. These are professions that we desperately need more people to be undertaking, with national levels at a breaking point across all states and territories. And these are professions that graduates are leaving in droves, in part, because the cost of living is outstripping their salaries.
Why, then, would we ask them as students to either go into debt or live impoverished before they’ve even formally entered the profession? In that light, $319.50 is less of a saving grace and more of a slap in the face.
Of course, the placement payment is better than what students were previously receiving, which was nothing. And according to Clare, it is just a starting point.
But just because something is better than nothing doesn’t inherently make that something good, or something anyone should have to put up with. Especially not when the professions they choose are of such vital importance to all of us.
Victoria Devine is an award-winning retired financial adviser, best-selling author and host of Australia’s No.1 finance podcast, She’s on the Money. Victoria is also the founder and director of Zella Money.
- Advice given in this article is general in nature and not intended to influence readers’ decisions about investing or financial products. They should always seek their own professional advice that takes into account their own personal circumstances before making any financial decisions.
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