Source: The West Australian

Article: Click to view the original article


Pressure is mounting on the Government to shield people with student debts from huge hikes amid the cost-of-living crisis, with one crossbencher saying it looks like ministers just don’t “get it”.

At the moment, HELP loans are adjusted annually on June 1, meaning the debt continues to increase without taking into account what people have already paid off in tax during the financial year.

The debts, also known by their old name of HECS, are tied to inflation rather than wages growth. Last year, that meant the average loan of $22,636 grew by nearly $1600.

Crossbenchers including Dai Le and teal independents Zoe Daniel and Allegra Spender have urged the Government to fix this by immediately adopting recommendations from the Universities Accord.

The expert review of higher education, released on Sunday, says changing the date of indexation on student loans to come into effect post-tax time would reduce the length of repayments. It also says that linking them to either inflation or wages growth, whichever was lower, would ensure debts did not outpace growth. Ms Le says the recommendations looked great but now the Government had to act.

“I know of young people who are in the workforce at the moment, who are still paying off their $60,000 HECS debt. Now they’re not going to be able to get a loan to buy a house”, the western Sydney MP told The West Australian.

“Unless you’re living in that community, from a community like Fowler, you don’t understand the challenges, such as rent, electricity prices, soaring food costs, transport.”

This week she asked Anthony Albanese when he would act on student debts but his answer instead focused on his amended tax cuts and on aged care wage increases.

“For the Prime Minister to not really answer the question around the HECS indexation for young people, how much is he thinking about the youth of this country?” Ms Le said.

“If they got it, they would have addressed it in the policies by now. I don’t think they get it.”

Ms Daniel wrote to Education Minister Jason Clare this week asking him to accept the Accord’s recommendations around HELP loans “in full and expeditiously”.

She led a crossbench push for action in the lead up to last year’s Budget, and now say with the expert recommendations there is no reason to wait any longer.

“Our young people are facing uncertainty, instability and inequality on so many levels,” the Victorian MP told The West.

“When you’ve got an obvious Federal lever you should use it to alleviate that pressure on young people.”

Mr Clare told Parliament on Monday, in response to a question from Ms Spender, that the report had recommended ways to make HECS “fairer and simpler” and the Government was working through those suggestions.

Shadow education minister Sarah Henderson said Mr Clare “must stop sitting on his hands” after inflation had fuelled crippling increased to student debts.