Latest news with #studentdebt
News.com.au
9 hours ago
- Business
- News.com.au
Federal government to legislate student debt relief, 20 per cent cut for all HECS
The Albanese government has chosen their first winners in the new parliament, as it promises to shave 20 per cent off all student debt in its first sitting week. Labor is set to introduce legislation as parliament returns this week that will wipe $16bn in student debt for approximately three million Australians. It will target loans including HELP debt, VET loans and apprenticeship loans. According to calculations from the government someone with the average HELP debt of $27,600 will have $5520 wiped from their outstanding loans. People at the upper end of debt, exceeding $60,000, could see a reduction of more than $12,000. The legislation, if it passes, will also raised the minimum repayment threshold from $54,000 to $67,000, meaning low-income earners will not have to start paying back their debt. Following the passage debt-holders will not have to do anything to get the reduction, it will be applied by the Australian Taxation Office automatically. Education Minister Jason Clare said the change would 'take a lot of weight off the shoulders' for recent graduates 'You don't start paying off your university degree until your degree starts to pay off for you,' he said. The reform was first promised in November 2024, well before the election, after the government changed the way student loans were indexed. At the time this brought down student debts by about $3bn. Prime Minister Anthony Albanese announced the 20 per cent reduction following the indexation reform as a pitch for his government to make the education system 'fairer and affordable for every Australian'. 'No matter where you live or how much your parents earn, my Government will work to ensure the doors of opportunity are open for you,' Mr Albanese said in November. Now, with the new Parliament beginning on Tuesday, the government is promising the 20 per cent cut will be the first thing it does. 'We promised cutting student debt would be the first thing we did back in Parliament,' Mr Albanese said. 'And this week we're introducing the legislation to make it happen. 'Because getting an education shouldn't mean a lifetime of debt.' The legislation will be introduced on Tuesday, but the government will need the support of either the Greens of the Coalition to get the it through the Senate. This means it will likely be a few weeks before it actually comes into effect. Both the Greens and the Coalition have indicated they are unlikely to block the bill, but both have voiced concerns. Liberal education spokesman Jonno Duniam told the ABC's Insiders program on Sunday that Australians 'spoke pretty clearly at the last election' about this key Labor policy. 'We're not really in business of standing in the way of cost-of-living relief,' Senator Duniam said. 'We'll go through our process but I expect this will pass the parliament.' For their part, the Greens requested the Parliamentary Library analyse how much the debt reforms will reduce balances since 2022. It found that a student who had a $30,000 debt in 2022 would have a $27,619 debt after the 20 per cent cut, meaning it would only be a 7.9 per cent cut on that 2022 level. This is because student debt increases each year relative to inflation. The Greens position is that it wants all student debt to be wiped and free university and TAFE to be reintroduced. Greens higher education spokeswoman Mehreen Faruqi said that 'one-off debt reduction won't fix the enormous burden' of university fees and outstanding student debt. 'Of course any student debt relief is better than none, but we are demanding all student debt be wiped and a return to free uni and TAFE, funded by taxing big corporations to pay their fair share,' she said. Student debt massively increased since the previous Coalition government introduced its 'Job-Ready Graduates' scheme in 2021 which increased the costs students have to pay for degrees that were purportedly less desirable. This was designed to incentivise students to study degrees in fields such as science and engineering. In practice there was only a marginal reduction in the number of students studying arts degrees, but the costs for those courses increased as much as 140 per cent – massively increasing the debt burden for some students.
The Guardian
a day ago
- Business
- The Guardian
Labor's signature Hecs debt relief will be introduced to parliament this week. Here's what it means for you
When Anthony Albanese fronted the media in November to announce Labor would cut 20% of all student debt if he won government, he described the move as 'about opening the doors of opportunity – and widening them'. Almost nine months later, the key election promise will be among the first pieces of legislation the federal government introduces when parliament returns on Tuesday. Here's what you need to know about how it will work, who it will help, and what's missing. Sign up for Guardian Australia's breaking news email If the legislation passes, 20% of student debt will be wiped from the 3 million Australians with outstanding loans, equivalent to around $16bn according to the federal government. The minimum repayment threshold will also be raised from $54,000 to $67,000, which is expected to save the average debt holder about $680 a year, and reduce the amount low income earners have to pay. The measures are being sold as providing cost-of-living relief for young Australians, who hold the bulk of student debt. Speaking to the media on Wednesday, the education minister, Jason Clare, said the average Australian with a student debt would have about $5,500 shaved off their loans. For Australians on an average income of $70,000, he said the bill would reduce the minimum amount they were required to repay by about $1,300. 'It'll take a lot of weight off the shoulders of a lot of young Australians who are just out of uni … looking to move out of home or save up to get a mortgage,' Clare said. 'You don't start paying off your university degree until your degree starts to pay off for you.' Students have broadly welcomed the changes, while arguing they don't go far enough. The president of the National Union of Students, Ashlyn Horton, said cutting debt was a 'long overdue move' that indicated Canberra 'might finally be listening' to concern about the rising cost of degrees. But she said the bill 'doesn't come close to fixing the structural mess that got us here'. 'The core problem remains: students are still paying some of the highest fees in the Oecd under a system that punishes them for choosing the 'wrong' degree,' she said. 'That system has a name – the Job-Ready Graduates package (JRG) – and Labor has left it untouched.' The Coalition's widely canned JRG scheme drastically increased the prices of arts degrees, which cost $50,000 as of 2024, to incentive students into other courses. The Greens and the Coalition haven't confirmed whether they will support the Labor bill but sources have suggested it would be unlikely for them not to back it, given the demand for cost-of-living relief. On Sunday, the shadow education minister, Jonathon Duniam, indicated the Coalition wouldn't block the bill in parliament despite still holding some concerns. 'We're not really in the business of standing in the way of cost-of-living relief … [and] it is one of those things that Australians wanted, they voted for,' he said. 'We've expressed our concerns. Australians have had their say. We've got to move on.' While proving to be a popular policy among voters, the bill has been critiqued for not addressing the root of student debt – which is indexation and the rising cost of degrees. Analysis conducted by the parliamentary library for the Greens and provided exclusively to Guardian Australia shows the 20% cut will be reduced to just 8% since Labor entered office when accounting for indexation since the 2022 election. That's despite the federal government's changes to indexation by tying Hecs/Help debts to whatever is lesser out of the wage price index (WPI) or consumer price index (CPI). For instance, a student debt balance of $30,000 in 2022 would have had their debts rise to $33,454 before the student debt reduction as a result of indexation. Following the 20% cut, their debt would drop to $26,763, and with 2025 indexation, rise to $27,619 – just 7.9% less than in 2022. The modelling assumes no repayments had been made. The Greens' deputy leader and spokesperson on higher education, Mehreen Faruqi, said 'Labor crowing about a small one-off debt reduction won't fix the enormous burden of uni fees or student debt that keeps growing every year'. 'Of course any student debt relief is better than none, but we are demanding all student debt be wiped and a return to free uni and Tafe, funded by taxing big corporations,' she said. Clare has flagged that more will be done in Labor's second term to reform the higher education sector, but it may not happen fast. This year, the federal government is planning to introduce legislation to improve the integrity of the international education system, and to permanently establish a new Australian tertiary education commission. The independent body was a recommendation of the Universities Accord, handed down early last year. A priority of the commission will be reforming the pricing of degrees, including introducing needs-based-funding into higher education, as is being rolled out at primary and secondary schools. On Wednesday, Clare confirmed that part of its work on funding would be assessing the JRG package, without a timeframe for reform.
The Australian
a day ago
- Business
- The Australian
Labor to act on key cost-of-living promises in first week of parliament
Australians are weeks away from receiving a 20 per cent cut to their student debt, with Labor vowing to scrap HECS and HELP debt as the government's first priority once parliament resumes, following the government's landslide election victory. The changes will be applied to all student debts as they on June 1, 2025, with the average HELP debt of $27,600 set to receive a reduction of about $5520. The HECS reform will also reduce the repayment threshold for debts from $56,156 to $67,000. Rates of repayments will also be lowered then current levels, with someone on $70,000 paying $1300. Despite the Coalition not supporting the measure during the campaign, education spokesman Jonno Duniam said he expected the Bill to 'pass' parliament. Labor will pursue action on its election vows to slash student debts and introduce paid prac ahead of parliament returning on Tuesday. Picture: NewsWire/ Nicholas Eagar Speaking to the ABC on Sunday, he said that while the legislation would still need to go through party room and shadow cabinet, he believed 'the Australian people spoke pretty clearly … around the policies the Labor Party took,' adding the party was 'not really in the business of standing in the way of cost of living relief'. Labor will also seek to introduce its cost-of-living election promises, including the $150 energy rebate top up, the 30 per cent discount on home batteries, paid prac measures for student nurses, teachers, social workers and midwives, plus a $10,000 cash bonus for trainee builders who finish their construction apprenticeship. It will also begin work on legislating a two-week increase for Government Paid Parental Leave and laws to add superannuation on government paid parental leave, while also increasing the Super Guarantee to 12 per cent. Education Minister Jason Clare will also use the first sitting week to introduce Bills to tighten protection settings in childcare centres, including provision to allow anti-fraud officers to inspect centres with a warrant or police supervision. The Coalition has also said it's open to working with the government to get the Commonwealth to pull funding on centres which fail to meet safety standards after a Victorian former childcare worker Joshua Brown was hit with more than 70 child abuse charges. While Labor holds a thumping 94-seat majority, out of a total 150 seats, in the Lower House, the government will still need to negotiate with either the Greens (which hold 10 seats), the Coalition's 27 senators, or the 10-member crossbench. Politicians are set to return to Canberra on Tuesday for the first sitting fortnight of the 48th parliament. Picture: NewsWire/ Martin Ollman After an election bloodbath, the Coalition will return with a significantly reduced 43 seats, while the Greens have been reduced to a single seat. Ahead of the official opening of the 48th parliament, Sussan Ley warned that while the Coalition would 'provide a constructive path for any legislation that makes Australia stronger,' it's 'good will is not a blank cheque'. As it stands, the opposition has already vowed to fight Labor's proposed superannuation tax on balances over $3m, with the Coalition also set to eye accidentally released treasury advice to Jim Chalmers which urged him to consider new taxes to increase the budget outlook. 'Anthony Albanese is yet to explain why his departmental officials secretly advised the Treasurer that Labor would need to raise taxes on Australians,' the Opposition Leader said. 'We will seek answers on behalf of Australian taxpayers, not one of whom should face a new tax that they didn't vote for.' It will also continue to attack Labor over its handling of Australia-US relations, following further fallout from Donald Trump's tariff trade war, with Anthony Albanese yet to secure a meeting with the US President. Jessica Wang NewsWire Federal Politics Reporter Jessica Wang is a federal politics reporter for NewsWire based in the Canberra Press Gallery. She previously covered NSW state politics for the Wire and has also worked at and Mamamia covering breaking news, entertainment, and lifestyle. @imjesswang_ Jessica Wang
News.com.au
a day ago
- Business
- News.com.au
Labor to act on key cost-of-living promises like 20pc HELP debt wipe-out, paid prac, $150 energy rebate
Australians are weeks away from receiving a 20 per cent cut to their student debt, with Labor vowing to scrap HECS and HELP debt as the government's first priority once parliament resumes, following the government's landslide election victory. The changes will be applied to all student debts as they on June 1, 2025, with the average HELP debt of $27,600 set to receive a reduction of about $5520. The HECS reform will also reduce the repayment threshold for debts from $56,156 to $67,000. Rates of repayments will also be lowered then current levels, with someone on $70,000 paying $1300. Despite the Coalition not supporting the measure during the campaign, education spokesman Jonno Duniam said he expected the Bill to 'pass' parliament. Speaking to the ABC on Sunday, he said that while the legislation would still need to go through party room and shadow cabinet, he believed 'the Australian people spoke pretty clearly … around the policies the Labor Party took,' adding the party was 'not really in the business of standing in the way of cost of living relief'. Labor will also seek to introduce its cost-of-living election promises, including the $150 energy rebate top up, the 30 per cent discount on home batteries, paid prac measures for student nurses, teachers, social workers and midwives, plus a $10,000 cash bonus for trainee builders who finish their construction apprenticeship. It will also begin work on legislating a two-week increase for Government Paid Parental Leave and laws to add superannuation on government paid parental leave, while also increasing the Super Guarantee to 12 per cent. Education Minister Jason Clare will also use the first sitting week to introduce Bills to tighten protection settings in childcare centres, including provision to allow anti-fraud officers to inspect centres with a warrant or police supervision. The Coalition has also said it's open to working with the government to get the Commonwealth to pull funding on centres which fail to meet safety standards after a Victorian former childcare worker Joshua Brown was hit with more than 70 child abuse charges. While Labor holds a thumping 94-seat majority, out of a total 150 seats, in the Lower House, the government will still need to negotiate with either the Greens (which hold 10 seats), the Coalition's 27 senators, or the 10-member crossbench. After an election bloodbath, the Coalition will return with a significantly reduced 43 seats, while the Greens have been reduced to a single seat. Ahead of the official opening of the 48th parliament, Sussan Ley warned that while the Coalition would 'provide a constructive path for any legislation that makes Australia stronger,' it's 'good will is not a blank cheque'. As it stands, the opposition has already vowed to fight Labor's proposed superannuation tax on balances over $3m, with the Coalition also set to eye accidentally released treasury advice to Jim Chalmers which urged him to consider new taxes to increase the budget outlook. 'â� Anthony Albanese is yet to explain why his departmental officials secretly advised the Treasurer that Labor would need to raise taxes on Australians,' the Opposition Leader said. 'We will seek answers on behalf of Australian taxpayers, not one of whom should face a new tax that they didn't vote for.' It will also continue to attack Labor over its handling of Australia-US relations, following further fallout from Donald Trump's tariff trade war, with Anthony Albanese yet to secure a meeting with the US President.
Yahoo
a day ago
- Business
- Yahoo
Five ways to avoid, reduce college debt
Students searching for the college of their dreams typically consider a multitude of factors: strong academic program in their major, vibrant campus life with attractive amenities, student abroad and internship opportunities. But one factor that eventually becomes a focal point is college cost. Currently, more than 40 million Americans have federal student debt totaling more than $1.6 trillion. To avoid joining that group, collegebound students should consider some strategies. Students should apply to at least one public in-state college, where the list price tuition is typically the most affordable. The tuition at Rutgers University – New Brunswick for this past academic year was $17,929 for New Jersey residents. At The College of New Jersey (TCNJ) it was $19,632, and at New Jersey Institute of Technology (NJIT) it was $19,000. Room and board do add to the cost, but most New Jersey students live within commuting distance of at least one of New Jersey's 11 public four-year colleges. More: Demonstrated interest bolsters acceptance rate | College Connection Students should spend time in high school identifying the field they want to pursue in college. It's never a good idea to start college 'undecided' because there's no guarantee that once a student does identify a favorite major, there will be a seat available in the program. Even if the student is able to enroll, the courses that have already been taken may not count towards those required for the major. Thus, graduation may be delayed by one or more semesters – significantly increasing the cost of earning a degree. Students should earn money during their college years to help offset student debt or at least cover some of their living expenses. There are companies with locations near many colleges that offer tuition reimbursement including Chipotle, McDonalds, UPS, AT&T, Comcast, T-Mobile, Best Buy, Home Depot and Walmart. More: College essays present unique opportunity to shine | College Connection Students should invest some time in seeking, and applying for, available scholarships. A good place to start is at which offers a scholarship search database that includes four million scholarships that are collectively worth more than $22 billion. Students should work hard to have the highest GPA and SAT scores that they are capable of earning. It's typical for colleges to award scholarship money based on these criteria. Whatever scholarship money is offered for the first year is typically renewed for the next three years. Thus, a $15,000 award ultimately provides $60,000 in scholarship money. So, focusing on GPA and SAT scores is frequently the easiest way for students to minimize their student debt. By paying attention to college costs in advance of enrolling, students can avoid a future of debilitating debt. Susan Alaimo is the founder & director of Collegebound Review, offering PSAT/SAT® preparation & private college advising by Ivy League educated instructors. Visit or call 908-369-5362. This article originally appeared on College debt: Five ways to avoid, reduce financial burden Solve the daily Crossword
