The Albanese government has promised to slash HECS debts by 20 percent in re-elected. It’s also promised to lower minimum repayments and life the threshold before students must begin paying back the debt as part of a pitch aimed at young Australians struggling with the cost of living.
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00:00There's a general agreement that the HECS debts are too big, they're much bigger than
00:06was envisaged all those years ago. This is a one-off 20% cut. I can understand in the
00:14whole context of the overall level of the debts. Down the track, there needs to be attention
00:21placed on the relative prices. The former government in 2020 changed the prices very
00:27radically. In particular, the prices and the charges for humanities graduates more
00:32than doubled. I think that's inequitable and can be fixed. So that's something for attention
00:39down the track. I think the government is aware of that. The most important and positive
00:43thing that's happened in the announcements on the weekend is the increase in the first
00:48threshold of income in which people have to repay, start to repay their debts. It's currently
00:54about $54,500. That means that a lot of people earning between say $55,000 and $65,000,
01:02they're not well off in those periods. They're obligated to repay HECS now. The system was
01:08not supposed to be like that. So I think the most important and positive thing is the increase
01:14in the first threshold of repayment to $67,000. It's also accompanied by a difference in the
01:20way the debt is collected to make it more reasonable and sensible to have it based on
01:26marginal income like income tax. That's been a problem with the system for a very long
01:31time. I don't think it's had major implications, but it should be fixed. And that's what the
01:37government is doing.