Roughly three million graduates, including those who went to the University of Newcastle, are set to benefit under the proposed reforms.
The student debt of thousands of graduates in the Hunter is set to be slashed under proposed changes to the HECS-HELP loan scheme.
The Federal Government has confirmed it plans on introducing reforms to parliament next year, which will lift the minimum threshold for how much people need to earn before they have to start paying off their student debt by about $10,000 to $67,000 per year in 2025-26.
Repayments would then be based on the portion of a person’s income above the new threshold, which will also be indexed to stay at 75 per cent of average graduate earnings.
The reforms will apply to everyone who has a student debt, including all HELP, VET Student Loan, Australian Apprenticeship Support Loan and other student support loans.
For someone on an annual income of $70,000 this would mean savings of around $1,300 per year on repayments.
Federal Education Minister Jason Clare said it will deliver significant and immediate cost of living relief to roughly three million Australians with student debt, allowing them to keep more of their hard-earned money at a time when many are looking to save for a house deposit or start a family.
“What this will do is help people who are just starting out,” Minister Clare said.
“They have just finished uni, they have just finished TAFE. and they’ve now got to pay the bills, pay the rent or are saving for a mortgage or they’re trying to start a family, and this will just take a bit of the pressure off and help a lot of young Australians right across the country.”
The move to a marginal repayment system is a recommendation of the Australian Universities Accord, and has been informed by the architect of the HELP system, Emeritus Professor Bruce Chapman.
The pitch comes ahead of the upcoming Federal Election, with Prime Minister Anthony Albanese expected to provide further detail on the proposal when he speaks in Adelaide tomorrow.