If you thought last year’s seven percent HECS debt indexation was a doozy, then we have bad news for you: experts are predicting HECS debt will be indexing in near-record numbers again.
HECS debts are forecast to rise between 4.2 and 4.8 percent in this June, the ABC reports. For the average ex student with a HECS debt of $26,494, they’ll need to pay an additional $1,113 to $1,272 on top of their debt. For ex students who completed a more expensive degree — like a Bachelor of Medicine — the fees will be much, much higher.
Sigh. Remember when going to university was free?
Why are HECS fees going up again?
The 2024 rise of between 4.2 and 4.8 percent is a prediction, based on data from the Parliamentary Library for the Greens. It’s worth remembering that this is just a prediction, not the final HECS indexation number. The official number will be calculated later this month and officially rolled out in June.
In case you have repressed the horror of last year’s indexation, or words with such mathematical implications make your eyes glaze over, here’s a really quick explainer:
Every year, the Federal Government increases HECS debts by a small percentage to keep them in line with inflation. Because inflation was so high last year, HECS debts increased by 7.1 per cent. This increase is called “indexation”.
While a 4.2 per cent increase may not feel like much because last year’s was so much higher, it’s still a substantial increase. To put it into perspective, the indexation in 2022 was 3.9 per cent and in 2021 it was only 0.6 per cent.
Imagine. A 0.6 per cent increase. We might actually be able to make a dent in our debts, instead of finding ourselves to be owing more than we’re paying. Love that!
Greens’ Senator Mehreen Faruqi has called out HECS debts for being a “barrier” to education, and reckons we should ditch them all together.
“Student debt can’t be fixed because student debt shouldn’t exist. But at the very least, it shouldn’t be increasing at such a ridiculous rate,” she said.
“Financial costs should never be a barrier to education. Yet the reality is, young people today are rethinking university after witnessing years of skyrocketing student debt under the [Anthony] Albanese government.
“University and TAFE should be free and all student debt wiped. But let’s start with abolishing indexation and providing some relief to people being weighed down by an ever ballooning debt.”
Despite the unshakeable feeling of impending doom that comes with having to reckon with the debt we’ll likely take to our graves, there’s still hope: there have been calls for change in the way we choose the indexation figure, so that it is the lower number of either the Consumer Price Index or Average Weekly Earnings (stay with me).
This would mean increases to debt would NOT be higher than pay rises. Slay! Or well, as much as you can slay in this shoddy economic system.
We don’t know for sure if the Albanese government will heed those calls for change, but Federal Education Minister Jason Clare has said Labor will respond to the Universities Accords calls to make HECS “simpler and fairer”.
We’ll have to wait for the budget to know if relief is on the way. If not, I’m changing my identity and moving to Peru.
