Bad News For Those With HECS Debt
University graduates may have to start paying back their loans sooner as a report has revealed that many students will never earn a high enough income to start paying back their HELP (HECS) debts.
A Gratton Institute report has found the government could claw back an extra $500 million a year, if it lowered the income threshold that students start repaying their loans at.
At the moment students repay their Higher Educations Loans Program (HELP) and VET-FEE HELP loans once they start earning $54,186.
The study shows that if that figure was reduced to $42,000, this would immediately increase the amount of people repaying their debt by 50%.
Andrew Norton, who wrote the report, says that the HELP program has become unsustainable without change and the ballooning costs would put teaching and research at risk of cuts,
The annual bill for HELP loans has reached $7.8billion and 20 per cent of that is considered ''bad debt'' that will never be repaid. That equates to $1.6billion a year.