Ms LE (Fowler) (18:30): I rise today to shine a spotlight once again on the challenges and struggles facing the young people pursuing higher education in my community of Fowler, which is one of the lowest socioeconomic communities in the country. My biggest concern lies with the fact that our young people will not be able to keep up with the aftermath of their student debt. Last year, university students and graduates were slugged with an average 7.8 per cent increase in tuition fees. This was on top of the already massive HECS debt hanging over their heads. Students are going to see their student loans increase by thousands of dollars following this spike in indexation. Although HECS-HELP loans are considered a ‘good’ debt and incentivise eligible students to repay their debt after completing tertiary education, many graduates struggle to pay this off, even when they have a job, especially now with the cost-of-living crisis.

The burden of student debt is growing, and, nonetheless, Labor has decided to sit back and watch millions of Australians suffer from the highest indexation rates we’ve seen in 32 years. How is this acceptable? I’ve called on the government to freeze HECS-HELP indexation, as it’s certainly not helping students at all. It’s doing the opposite of helping; it’s putting pressure on our youth—as if they don’t have enough to worry about with the cost-of-living crisis. Young people are the future of our community and economy. While the Australian University Accord has made recommendations, such as making the system fairer, the decision-makers in this room haven’t budged, and I urge the government to take this issue seriously.

There are currently 38,000 students in the Fowler community, of which 20 per cent are attending university and 21 per cent are in high school and are hopeful of going to university in the future. With the possibility of HECS indexation increasing due to CPI and the spike in the price of goods and services, the younger generation will struggle to keep up with their massive student debt. This will result in graduates taking longer to pay this off. The government must intervene urgently to assist our future generations.

The feedback I received from my Fowler youth advisory committee was that the cost-of-living crisis remains the key issue concerning young people in my area. They expressed concerns about how they will cope in this economy in which the price of everything is rising. This group of passionate young people is just a small representation of the large cohort of students within Fowler who are calling for the government to do something to alleviate the cost-of-living crisis. I can assure you that the increase in indexation will be felt most by those in Fowler, so I’m asking the government to consider the voices of future generations. It is our responsibility to create systems that make life easier, not harder, for people.

When discussing the federal government’s budget, Treasurer Jim Chalmers stated that his government would not consider pausing indexation, as the budget does not allow this. The Treasurer and I have spoken in the past about the similarities of our electorates, so I’m sure he understands the seriousness of this issue for the youth in his electorate as well, and it’s more pertinent now than ever.

I refuse to believe this is an issue of affordability. When examining this year’s budget, I saw the government has committed $368 billion to war machines and $251 billion to tax cuts for billionaires. Has our government got their spending priorities wrong? How are we to be a clever country if we don’t invest in our young people and ensure that they get access to the best and affordable education? I think it’s fair to say that the government doesn’t care about the future of our young people, and their refusal to address this increasing mountain of debt our students are facing is just so they can help balance the budget.

Last year, the government generated $3.6 billion just from HECS-HELP indexation alone. I think it’s unprecedented for the government to generate mass student repayments from indexation, on top of drowning students with a steep increase in student fees. How do we encourage high school students to pursue higher education and to plan for future careers with this rate of debt? I call on the government to reconsider the budget allocation and to ensure that students who are struggling and calling for help are looked after and heard. The Labor government, the so-called party of the working people, says the current indexation system is fair and working. Is it fair? Is it working? The reality of the current system can be summed up in two words: unfair and unsustainable. This is especially true for bright young people within lower-socioeconomic areas like my community. Therefore, it’s imperative that the government address concerns about how an increase in indexation is disproportionally impacting youth within these areas.

It’s my understanding that students can avoid the increase of indexation if they’re willing to pay off their HECS through voluntary payments. In May 2022, 33,543 voluntary student debt repayments were made when the income indexation rate was only 3.9 per cent. We then saw a spike in voluntary payments in the following year: 130,494 voluntary debt repayments were made when the income indexation rate was 7.1 per cent. This exponential payment growth suggests that students had to rush to repay their debt to avoid the indexation rate. But this was for those who were able to pay up-front; what about all those who couldn’t? I can assure everyone that the majority of young people in Fowler would not and could not afford to do it—and also those in the rest of Western Sydney. Many are struggling to juggle their studies along with part-time jobs and other commitments, with many having the responsibility to contribute to rent and water bills to help support their families in this cost-of-living crisis.

As the representative of my Fowler community in Western Sydney, it’s my duty to voice their concerns, struggles and stories regarding the current student debt crisis. I’d like to remind members of this House that the weekly income of individuals within Fowler is about $521. It’s expected that the median income for graduates will be lower. How do we expect young people to survive? The increase in indexation makes it harder for young graduates working in entry-level jobs to make ends meet—to pay bills and rent, and to put food on the table. What is our role in this House? Surely, as legislators, we legislate to make life easier for people to go to work, to earn a living, to set up a business, to buy a home or to raise a family. We must look at opportunities to assist students and graduates who study, while also limiting the impacts of ever-increasing indexation. In doing so, we can ensure that students within lower-socioeconomic areas aren’t left behind. Any steps taken to alleviate the burdens imposed upon young people count. According to the Australia Institute, HECS-HELP indexation in the last year will leave people earning less than $62,000 a year, with an increase in indexation bigger than the repayments. This concerns me, as many young graduates, especially those in Fowler and Western Sydney, will fall within this threshold. The steep increase in student debt will cause a domino effect, which will inevitably hold its own social and financial consequences.

Maybe this is the reason why young people are still living at home longer. One of my constituents from Fairfield East has concerns about the student debt crisis. The constituent shared that she has followed the traditional pathway of studying hard at university and then finding a job, but she is struggling to pay off her $60,000 HECS debt due to the 7.1 per cent indexation rate. On top of that, much of her salary is going in income tax. How do we expect these people to survive in this economy? Every student and graduate should be able to enjoy an equitable and fair education system. However, it is challenging to achieve this when some students, who have started with a larger debt, see their loan amounts grow more rapidly than expected. Where does the equity lie? We need a fairer system.

I call on the government to reconsider the ramifications of the Morrison government’s Job-ready Graduates package, which aimed to encourage students to study in areas of national priority. Although the package is designed to decrease tertiary fees for some courses while increasing them for others, the fees increases outweigh the decreases. In particular, the overall student contribution to degrees has risen by $476 million per year. It’s clear to me that our youth are still struggling to breathe because of the government’s failure to unwind unfair systems. This will only increase with ever-growing burdens and stress on students, who just want to pursue their dream degrees and careers.

Those who have completed tertiary education and are locked into HECS repayment will also experience difficulty obtaining a home loan to purchase a first property. HECS debt has a direct impact on home loans. What will the government do to ensure that young people are not being locked out of the housing market unfairly? According to ABC News, more than three million Australians are struggling to secure loans, such as mortgages, due to debt, including HECS-HELP debt. Let’s ensure that HECS-HELP actually does what it says—help, not hinder, our youths’ future.