Opinion & Commentary
First class, but the fare's fair
Overseas students pay tens of thousands of dollars to study at Victorian universities, but one expense, of up to $76 a month, has been transformed from a price to an injustice. That's the difference between a concession zone 1 and 2 public transport fare, to which full-time Australian undergraduates are entitled, and the normal fare that overseas students must pay.
Despite much lobbying by overseas students, the Victorian Government is unmoved. Lamenting the unchanged policy, in 2005 the president of the Melbourne University Overseas Students Service told a newspaper: "I don't know why we are second class." Last year, the overseas students took their cause to the Victorian Equal Opportunity Commission, alleging racial discrimination. The case is likely to proceed later this year.
Overseas students feel so strongly about Victorian public transport that it has turned into an international issue, with the Malaysian Minister for Education writing to his Australian counterpart, Julie Bishop, advocating a change in policy. She in turn wrote to the Victorian Government strongly encouraging it to re-evaluate the concession policy.
The overseas students' reasoning is by analogy: we are undergraduates, they are undergraduates, therefore Australian and international students should be treated the same way. But is this the right way to look at it?
The people eligible for public transport concessions fall into two broad categories, both related to low income. In the first group are those with proof of low income. Pensioners and health-care card holders, for example, have provided government authorities with evidence that they are poor, and concessions are part of their general welfare assistance.
In the second group are people likely to be on a low income, but without an obligation to provide specific supporting financial evidence - holders of seniors' cards, veterans and full-time undergraduate students.
This approach is certain to include anomalies. Some full-time undergraduates are genuinely poor, but others live well on parental support and income from part-time jobs. Part-time undergraduates or postgraduates could, in practice, be in a much tougher financial position. But it would take a large bureaucracy to collect and verify all this information, so it is administratively easier to set simple rules that usually but not always lead to the intended outcome.
Like Australian part-time undergraduates and postgraduates, overseas students could be poor. But unlike their Australian counterparts, their right to be in the country depends on maintaining, as the visa requirement for international students puts it, "enough money to pay for travel, tuition and living expenses for the duration of your stay in Australia". In the world of simple bureaucratic rules to assess financial capacity, overseas students look like the other ineligible categories of students rather than their fellow full-time undergraduates.
But even if some overseas students are needy, they must explain why Australian taxpayers should give them an added subsidy - on top of the subsidy, as the Victorian Government stresses, that they along with all other public transport users receive already when they pay "full" fares.
For the other concession categories, in most cases, cheap fares are as much about moving income around the life cycle as straight subsidy. Concessions go to previous long-term taxpayers (pensioners, seniors, veterans) or future long-term taxpayers (children, students). This won't be true of overseas students, who usually return home after completing their degrees. In most cases, concession fares for overseas students would redistribute money to them from Australian taxpayers.
The crucial distinction for public transport concessions is between temporary and permanent residents, a difference with significant consequences in welfare states around the world. To avoid being overwhelmed, every welfare system must have rules about who is and who is not entitled to assistance. In Australia, like elsewhere, there are many benefits available to citizens and permanent residents denied to others.
Indeed, the Victorian Government's intransigence in the face of intense pressure may have as much to do with preserving this distinction as saving the $30 million it claims it would cost to extend public transport concessions. If the state concedes this, where would the claims stop? On similar arguments, overseas students could claim rights to free hospital treatment and other benefits.
Overseas students have mistaken public transport concessions as benefits to students in general, when that is not their purpose. In the concession scheme, students are just one category of Australians in need. By their citizenship and visa conditions, overseas students are outside the eligible group.
They are not second-class people, just as similarly ineligible postgraduate students are not second class. They just don't qualify for added public transport subsidies.
Andrew Norton is a research fellow with The Centre for Independent Studies.
