1,000 signatures reached
To: Australian Federal Government
Freeze Student Debt
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We are calling on the Government to freeze HECS-HELP/VET loan indexation while inflation is elevated AND to review the HECS-HELP system.
Students and Young Australians have been facing many challenges over the last decade and will be the first generation of Australians who will face their quality of living going backwards. We are struggling with an elevated cost of living, flat wage growth and will soon become some of the most indebted Australians in history.
The average HECS debt will increase by $1,677 last year and this year. Anyone earning less than $63,000 will see their debt increase while making repayments.
Last year, the Government profited off of the average loan ($820) by borrowing money at the 10-year bond yield 3.6% while indexing the loans at 7.1%. This saw the total student debt increase by $4.5bn just in indexation in 2023.
THIS CANNOT HAPPEN AGAIN!
We know that student debts disproportionately affect women, low SES students, and students from marginalised backgrounds who take longer to pay off their loans and are thus having them compounded over longer periods.
Why is this important?
The Australian Universities Accord Final Report (2024) recommended “that to reduce the long-term financial costs of studying for students, the Australian Government make student contributions fairer and better reflective of the lifetime benefits that students will gain from studying, and reduce the burden of HELP loans, by introducing fairer and simpler indexation and repayment arrangements”.
The Federal Labor Government must freeze Higher Education Contribution Scheme (HECS) indexation to ease the burden of student debt and have the courage to take on the intergenerational wealth crisis in Australia, while these changes are occurring.
“We are already looking at becoming the most indebted generation in Australia's history and now the Federal Government is profiting from young Australians during a cost of living crisis,” NUS National President Ngaire Bogemann said.
The total value of HECS-HELP loans increased by $4.5 billion on 1st June with the average debt projected to increase by $1,700. Indexation at an estimated 7% means that individual HECS debts will increase even if a student or graduate doesn’t earn enough to pay it down. The NUS argues that this indexation is unfair, with the government expected to profit $2.5 billion from students and graduates this year.
“In the middle of a cost of living crisis, increasing student debts are pushing Australian students deeper into poverty," NUS Education Officer Grace Franco said. “Students are even having to withdraw from their studies to be able to work to afford basic living necessities.”
We urge the Government to listen to the voices of students and graduates and take action to end the unfair practice of student loan indexation.