The federal government has kicked off its re-election campaign, promising to cut 20 per cent from student HECS debts and lifting the minimum income which triggers repayments, from about $54,400 to $67,000.
The pledge has had a mixed response, with the federal opposition deriding the plan as unfair and the National Union of Students calling it a vote grab that will fail to counteract indexation.
The federal government moved earlier in 2024 to cap indexation on HECS at the lower of either the rate of inflation or the wage price index, after the indexation rate jumped above seven per cent.
Federal Labor says its HECS debt relief plan will ease pressure on students entering the workforce. (April Fonti/AAP PHOTOS)
According to federal education department projections, a social worker with a debt of $50,000 entering the workforce on a full-time income of $70,000 would repay $1300 less in the first year under the plan.
They would pay off their debt over 10 years and reduce their total repayment amount by $11,555 as their income increased over the decade.
An engineer with a $33,000 student debt from their bachelor degree and a $75,000 starting salary would enjoy an extra $1000 in their first year of repayments, and save more than $7400 in the six years it took to clear their study debt.
A nursing graduate with a HECS debt of $15,000 and a starting annual income of $56,000 would save an average of $1100 each year, the figures showed.
In both the case of the nurse and of the engineer, their student debts would be paid off in roughly the same time it would take under the existing arrangements.
Students of humanities, communications and human studies will be viewing the planned 20 per cent discount in conjunction with tuition-fee spikes of up to 113 per cent following the Morrison government's Job-ready Graduates scheme.
Labor has been under pressure to scrap the scheme, which hiked the prices of certain degrees and subsidised others to encourage students towards careers in industries facing labour shortages.
