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risky business: how budget reforms to higher education could impact women

Image: Wikimedia Commons

Image: Wikimedia Commons

My mum once told me that when she quit her job after my younger sister was born to look after my sisters and me full time it was the happiest time of her life. But to really understand that statement you need to know a little bit about my mum.

In the speech she gave at my 21st birthday party my mother revealed (to the amusement of everyone present) that she wasn’t entirely happy when she found out that she was pregnant with me.  In fact she was so dismayed that her doctor reminded her of a woman’s right to choose.  At this point in her life my mother had graduated with a Bachelor of Laws, won a university medal, completed an honours year at Oxford and was newly arrived back in Australia to take up a teaching position at her old university.  So I think it’s fair to say she was a pretty academic, career oriented person.  And having kids so soon was definitely not part of the plan.

As it turned out, the plan could be moulded to accommodate for a loud, often smelly, insomniac baby, so Mum had me, took her maternity leave and then went back to work.  When my sister was born two years later, however, she quit her job.  My dad worked full time and despite having a mortgage on the house and 18+ years of child related expenses to look forward to, my parents decided they could afford to live on a single income for a few years.

One of the reasons Mum gave me for her decision to quit work to focus on us, her kids, despite being the academic person that she was (and still is,) was that you can pursue your career your whole life, but your kids are only young once.  She felt like she was missing out on seeing us grow, and that was reason enough to put off her career goals and take a hit financially in the short term.

Amongst the announcements in the Federal Budget were a string of ‘reforms’ to the area of higher education.  One of these was to raise the rate of interest charged on FEE-HELP loans, and to lower the income threshold at which people have to start paying off their student debt.  Student groups have criticised these changes, saying that it will make it more difficult for people from disadvantaged backgrounds to access higher education.

This week the Greens have released modeling showing the impact the proposed changes will have on women who take time off work after having children, and as a young woman with a sizable student debt under her belt, the findings are pretty concerning.

A woman who takes time off work or works part time for a few years after having children will end up paying around 30 per cent more interest on her loan because of the extra time it will take her to pay it back.  The Greens have calculated the amount of interest paid on a student loan based on the average salaries of nurses and teachers, and we’re talking upwards of five thousand dollars of extra debt for the woman who takes time off.

In the context of other budget announcements such as changing eligibility requirements for the Family Tax Benefit, co-payments for GP visits and increases to the cost of medicines under the Pharmaceutical Benefits Scheme, an extra $5-10,000 worth of debt is a scary prospect for families who are just starting out.  And this is all from a party who claim they stand for conservative family values.

When my mum decided to quit her job in order to spend more time with us, she took a calculated financial and career risk.  There’s no denying she was in a pretty privileged place to be able to do so at all – if she had been a single parent the option might not even have been on the table – but it was still a risk nonetheless.  Putting aside the question of why more mothers than fathers make the decision to put their careers on hold in order to spend time with their children, the fact that women are more likely to do it means the financial burden of this decision will fall more heavily on them.

If the changes outlined in the budget go ahead, and if I one day find myself in the similar position of questioning whether to pursue my career or spend more time with my children, the changes to the FEE-HELP repayment scheme are going to mean that I have an even heftier financial burden to bear.

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