Month: June 2025

The Prac Payment that will go to Services Australia and the ATO, as well as students

Andrew Norton1 Comment

Last year I was critical of how I thought the Commonwealth Prac Payments were going to work. These were to provide Austudy level payments, currently equivalent to $331.65 a week, for nursing, midwifery, social work and teacher education students while undertaking compulsory work placements. The payment starts on 1 July 2025 for students on income support and some working students.

Rather late in the day, the legal paperwork for its higher education version was completed last week. The vocational education diploma of nursing version paperwork was already available. The higher education version is administered by universities and funded through the ‘other grants’ provisions of the Higher Education Support Act 2003. The VET Prac Payment is administered by the Department of Employment and Workplace Relations, although the funding is authorised under the Social Security Act 1991.

Things I was concerned about that have not happened

Some of my Prac Payment concerns from last year were not realised in the policy as enacted. The Prac Payment has a means test but it is based solely on the student’s income, not family income. However family income has an indirect effect through eligibility for income support.

A policy goal is reduce the number of students who defer or withdraw from their course due to placement obligations, but students won’t need to prove that they are considering either of those things.

But in the Australian way of public policy, the Prac Payment is an underwhelming half-measure. The payment is low and will be further reduced by tax and by social security income tests. Many students won’t be eligible at all.

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What explains delays in attrition?

Andrew Norton2 Comments

I was quoted at the weekend in a Herald-Sun article about attrition from Victorian universities. The journalist wanted to know how much HELP debt students typically have on drop-out, but unfortunately this data is not regularly published (it should be of course).

But based on some old Grattan analysis, which had actual data to the mid-2010s, the fact that first year is the most common year for attrition, and the strong link between part-time study and attrition, I thought that the typical $$$ figure may not be too high.

That said, average or median HELP debt on dropping out may have increased at a faster rate than indexation in the early 2020s. This is due to students spending more time enrolled before dropping out.

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