Millions of young Aussies could pay $1,000 less a year in student loans through a ‘shake-up of the HECS-HELP system to make it ‘fairer and simpler’.
Education Minister Jason Clare flagged the possible change after publishing the biggest overhaul of the higher education system on Sunday.
The Universities Accord published the review calling on the government to make several changes, including doubling the number of university places by 2050.
Lowering tuition fees and increasing the country’s tertiary education graduate rate from 60 to 80 percent over the next 25 years were also among the recommendations.
The most notable suggestions were to reduce HECS-HELP repayments and introduce a tiered repayment structure where lower-income graduates repay less.
“For example, if we were to go down this route, it says that someone with an income of $75,000 a year would pay about $1,000 less every year,” Mr Clare said.
Professor Stephen Billett from Griffith University said he supported some reforms, especially the reduced HECS payments.
“While this amount may not seem like much, it will be welcome,” he told Daily Mail Australia.
Millions of young Aussies could save $1,000 a year less on student loans with a ‘shake-up of the HECS-HELP system to make it’ fairer and simpler
The revision of the University Agreement calls on the government to double the number of university places by 2050 and to reduce fees for certain subjects
“It’s a statement about recognizing the difficult circumstances Australian tertiary students face.”
The Albanian government will consider the changes when finalizing its next budget.
The Universities Accord recommends a review of bank lending practices ‘to ensure that HECS-HELP loans are not like other types of loans and are not treated in a way that unnecessarily limits people’s ability to borrow loans’.
“Unless a person earns sufficient income, there is no obligation to repay debts (HELP debts) and should therefore be treated differently,” it says.
Mr Clare told ABC Insiders that HECS-HELP should be ‘simpler and fairer’.
“We will look at these (recommendations) and determine them and prioritize what we do first in the response that we will release in the coming months,” he said.
The government will also consider a recommendation to link indexation to the wage price index, instead of the consumer price index.
Mr Clare said he would put proposals to the Spending Review Committee, but indicated the work needed to reform the higher education system would take years.
“We can’t do all this right away,” he said.
‘This is bigger than one budget, but we must now start laying the foundations for longer-term reforms.’
The review sets out targets including increasing the proportion of university-educated Australians aged 25 to 34 to 55 per cent by 2050, and the broader proportion of college-educated Australians to 80 per cent.
Other recommendations outline how students can be better supported during their studies, including a ‘job broker’ to help students find part-time work and work experience, and the greater availability of free preparation courses.
To achieve these targets, the government would need to double the number of Commonwealth-supported university students from 860,000 to 1.8 million by 2050.
The Education Minister said he also hopes to do this by helping more children from ‘poor families’ get a ‘crack into university’.
Mr Clare has ambitious plans to increase the number of bright students from the suburbs and regions going to TAFE or university.
The Education Minister said he also hopes to do this by helping more children from ‘poor families’ get a ‘crack into university’
This means that students whose families earn less than $54,000 a year will be guaranteed a place on a degree if they meet the entry criteria.
The Universities Accord, chaired by former NSW chief scientist Mary O’Kane, argued that many more people from disadvantaged backgrounds will need to graduate if the country is to have enough workers to fill the 6.3 million additional jobs requiring degrees by 2050 is needed. .
It recommended to have no limit on the number of places available for students from disadvantaged backgrounds, and giving these students extra money to support their learning.
To reduce the risk of dropout, the report also recommends creating more of a foundation to equip students with academic and study skills before they start a degree.
HECS-HELP loans allow students to defer the cost of a college degree by borrowing from the federal government and then repaying the debt through the tax system.
Graduates must pay one percent of their income toward their debt once they start earning $51,550 a year.