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Government commits to HECS-HELP changes that could save debt holders $680 a year
The changes would mean a shift to a marginal repayment system, as recommended by the Universities Accord, which found existing arrangements disproportionately affect those on lower incomes.
> In short: > > The federal government is committing to significant changes to the student debt scheme in a pitch to younger Australians hit hard by cost of living pressures. > > It claims the changes to the minimum repayment threshold and indexation will see the average HECS-HELP debt holder save $680 in yearly repayments. > > What's next? > > The government will introduce legislation to implement the changes next year.
> Under the proposal, repayments would operate similar to income tax thresholds where you pay a set rate per dollar above a certain level. > > That rate per dollar increases as you move along the income scale. > > The federal government's plan also lifts the minimum repayment threshold from $54,435 to $67,000 next financial year. > > That threshold will also be indexed to stay at 75 per cent of average graduate earnings.
> A university graduate earning $70,000 a year would see a $1,300 reduction in their minimum repayments. > > A graduate earning $80,000 a year would pay $850 less each year. > > The measure applies to graduates earning up to $180,000 a year.