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West Australian
10 hours ago
- Business
- West Australian
Labor under fire for HECS/HELP indexation timing
Aussies keen to see their student loan debts cut by 20 per cent as promised by Labor in the federal election may not be so happy when they check their accounts. Since Sunday, students with HELP or HECS loans would have seen their debts increase by 3.2 per cent as indexation kicked in. Indexation serves to adjust student loans according to inflation – but the timing at which they are applied has been heavily criticised for years. 'HELP debts aren't actually very helpful,' independent Tasmanian senator Tammy Tyrell said. 'Today, students are watching their debts go up, with the money they've paid through the year nowhere in sight. 'Banks reduce your loan before charging interest. Credit unions do too. Just not the government who pretend someone's repayments don't exist. It's costing students thousands of dollars all because Labor is too lazy to fix its accounting. 'Labor's HELP debt changes are one-off sugar hits. If they're genuine about making a difference for students, they could fix this rigged system when parliament returns. Just count someone's payments before interest is charged. 'It doesn't make sense to me that someone's debt is indexed before taking into account the thousands of dollars they've paid throughout the year,' she said. 'Imagine if banks did that with your home loan – took your money, charged you interest but the repayments don't come off the outstanding balance. I reckon people would be pretty upset about that, so why do we expect students to put up with it? 'A student's HECS-HELP debt should be indexed after the yearly repayments are taken off. 'No matter what the indexation rate is, it's not a fair system when you're indexing badly. We need to change the timing, not the rate.' Education Minister Jason Clare said Labor's policy to reduce HECS debts by 20 per cent would be backdated to June 1 before indexation was applied. 'It will be the first Bill that we introduce into the parliament when parliament sits for the first time in the last week of July,' Mr Clare told ABC radio. 'What that legislation will do is cut everyone's debt by 20 per cent and backdate that cut. And that's important because every 1st of June in every year HECS debts or student debts get indexed. 'That 20 per cent cut will come into effect before that indexation effectively happens to make sure that we honour the promise we made and we cut everyone's debt by 20 per cent. The Australian Universities Accord Final Report 2024 determined that the indexation should be applied later in the year after compulsory repayments made during the previous financial year were deducted from a student's balance.
Yahoo
3 days ago
- Business
- Yahoo
Key detail as student debt set to soar
Millions of Aussies with outstanding student debt will have their deficits deepened on Sunday, with a promised slashing of student debt still about two months away. One of Labor's big ticket pre-election promises was to slash HECS, VET and apprenticeship loans by 20 per cent as soon as Anthony Albanese's government was re-elected. People's debt will jump on Sunday when the annual increase kicks in, as laws to make the 20 per cent cut won't be introduced to parliament until MPs return to Canberra in late July. 'It will be the first bill that we introduce into the parliament when parliament sits for the first time in the last week of July,' Education Minister Jason Clare said this week. Student debts will be jacked up 3.2 per cent on Sunday, in line with the consumer price index. But once legislation for the 20 per cent cut is passed, debts will be slashed retrospectively, and the indexation applied will be adjusted to reflect the lower balance. This means the indexation increase will only apply to the amount owed before the June 1 increase, minus 20 per cent. Slashing student debts by 20 per cent will cost the federal budget $700m during the next four years, and $16bn over the coming decades. The average student debt in Australia is about $28,000; last term, the federal government tweaked the annual increases after debts skyrocketed during the back-end of the pandemic with massive inflation. 'I think everyone listening will know somebody in this situation and perhaps will know that HECS debts are bigger today than they were when I went to uni, when many of us went to university – that by cutting this debt by 20 per cent, it's going to help a lot of people get a good start in life, make it easier to get out there and buy their first home,' Mr Clare said on ABC radio this week. Higher education was free in Australia from 1974 until 1989. Initially, all degrees then cost $1800, but in 1996 the federal government brought in three-tiered rates. The current Education Minister, Mr Clare, finished with a bachelor of arts and a law degree from UNSW in 1998. The laws required to slash student debts by 20 per cent will have other functions too. 'It will change the amount of money that you have to earn before you start paying your debt back,' Mr Clare said. The threshold to start paying off the debt will rise from $54,000 to $67,000. For someone being paid $70,000, repayments should decrease $1300-per-year. 'It means more money in your pocket,' Mr Clare said. Laws need to change so the tax office can wipe 20 per cent off the debts. Labor will have to rely on the Greens to pass the laws through the senate. During the election campaign, the Greens said they would wipe all student debt if elected.
West Australian
4 days ago
- Business
- West Australian
‘Money in your pocket': Aussie student debt-slashing laws still months away
Millions of Aussies with outstanding student debt will have their deficits deepened on Sunday, despite a promised slashing of student debt being some two months away. One of Labor's big ticket pre-election promises was to slash HECS, VET and apprenticeship loans by 20 per cent as soon as Anthony Albanese's government was re-elected. People's debt will jump on Sunday when the annual increase kicks in, as laws to make the 20 per cent cut won't be introduced to parliament until MPs return in late-July. 'It will be the first bill that we introduce into the parliament when parliament sits for the first time in the last week of July,' Education Minister Jason Clare said this week. The 20 per cent cut will be backdated but will not annul the June 1 annual increase. Student debts will be jacked up 3.2 per cent on Sunday, in line with the consumer price index. But once the tax office wipes 20 per cent, the annual indexation increase will then actually be applied. Slashing student debts by 20 per cent will cost the federal budget $700m during the next four years, and $16bn over the coming decades. The average student debt in Australia is about $28,000; last term, the federal government tweaked the annual increases after debts skyrocketed during the back-end of the pandemic with massive inflation. 'I think everyone listening will know somebody in this situation and perhaps will know that HECS debts are bigger today than they were when I went to uni, when many of us went to university – that by cutting this debt by 20 per cent, it's going to help a lot of people get a good start in life, make it easier to get out there and buy their first home,' Mr Clare said on ABC radio this week. Higher education was free in Australia from 1974 until 1989. Initially, all degrees then cost $1800, but in 1996 the federal government brought in three-tiered rates. The current Education Minister, Mr Clare, finished with a bachelor of arts and a law degree from UNSW in 1998. The laws required to slash student debts by 20 per cent will have other functions too. 'It will change the amount of money that you have to earn before you start paying your debt back,' Mr Clare said. The threshold to start paying off the debt will rise from $54,000 to $67,000. For someone being paid $70,000, repayments should decrease $1300-per-year. 'It means more money in your pocket,' Mr Clare said. Laws need to change so the tax office can wipe 20 per cent off the debts. Labor will have to rely on the Greens to pass the laws through the senate. During the election campaign, the Greens said they would wipe all student debt if elected.
Sydney Morning Herald
21-05-2025
- Business
- Sydney Morning Herald
The school, transport and health projects being delayed in your area
School upgrades, a new children's court, hospitals, suburban parks and an expanded railway station are among more than 150 funded projects now delayed, according to the Victorian budget. Almost a third of the 518 projects funded in last year's budget have been delayed by at least three months. The total cost has also blown out $3.3 billion, or 1.9 per cent, in the year. 'The cost of materials and supply of skilled labour are improving across the construction industry. However, challenges remain,' Tuesday's state budget said. An analysis by The Age of state budget papers found 171 projects have been delayed, referred to as 'revised' completion dates. Many of them had already been delayed in previous budgets. For example, 10 community hospitals promised by former premier Daniel Andrews in 2018, have repeatedly faced delays. Recently completed projects were cut from the analysis. Premier Jacinta Allan and Treasurer Jaclyn Symes began their efforts to sell the budget to the public on Wednesday, defending the state's net debt levels, set to hit $194 billion by 2028-29. Allan said Victoria's budget strategy was working as the government stabilised debt and grew the economy. 'We've also got to recognise that right now, working people and families, are facing real pressures … and my choice as premier and our government is supporting them with that cost-of-living support,' she told ABC radio.
The Age
21-05-2025
- Business
- The Age
The school, transport and health projects being delayed in your area
School upgrades, a new children's court, hospitals, suburban parks and an expanded railway station are among more than 150 funded projects now delayed, according to the Victorian budget. Almost a third of the 518 projects funded in last year's budget have been delayed by at least three months. The total cost has also blown out $3.3 billion, or 1.9 per cent, in the year. 'The cost of materials and supply of skilled labour are improving across the construction industry. However, challenges remain,' Tuesday's state budget said. An analysis by The Age of state budget papers found 171 projects have been delayed, referred to as 'revised' completion dates. Many of them had already been delayed in previous budgets. For example, 10 community hospitals promised by former premier Daniel Andrews in 2018, have repeatedly faced delays. Recently completed projects were cut from the analysis. Premier Jacinta Allan and Treasurer Jaclyn Symes began their efforts to sell the budget to the public on Wednesday, defending the state's net debt levels, set to hit $194 billion by 2028-29. Allan said Victoria's budget strategy was working as the government stabilised debt and grew the economy. 'We've also got to recognise that right now, working people and families, are facing real pressures … and my choice as premier and our government is supporting them with that cost-of-living support,' she told ABC radio.
