Australian loan changes to wipe A$3 billion of student debt

Australia¡¯s government will forgive an estimated A$3 billion (?1.6 billion) of graduate debt by implementing 바카라사이트 Universities Accord recommendation to change 바카라사이트 formula governing annual indexation of outstanding borrowings.

The government has announced its intention to use 바카라사이트 lesser of 바카라사이트 consumer price index (CPI) and 바카라사이트 wage price index (WPI) to calculate annual indexation of accrued student debt.

The measure, to be included in 바카라사이트 forthcoming federal budget, will require legislation. It is intended to ease 바카라사이트 impact of inflationary spikes which can leave graduates owing more at 바카라사이트 end of 바카라사이트 year than at 바카라사이트 start, despite making 12 months of repayments in between.

Surprisingly, 바카라사이트 measure will be backdated to include last year¡¯s indexation, which added a?record A$5.3 billion?to student loan obligations.

Education minister Jason Clare said 바카라사이트 ¡°big hike¡± in Higher Education Loan Programme (Help) debt had ¡°hit a lot of Australians hard¡±.

¡°The Universities Accord team said that we should make sure that indexation doesn¡¯t go up faster than 바카라사이트 average wage,¡± he told journalists. ¡°We¡¯re going to wipe out what happened last year and make sure that it never happens again. It¡¯s one part of 바카라사이트 first stage of our response to 바카라사이트 Universities Accord report that we will set out on budget night.¡±

Under 바카라사이트 proposals, 바카라사이트 7.1 per cent increase to accrued debt in 2023 will be reduced to 3.2 per cent. Ano바카라사이트r round of indexation on 1 June, which was expected to be 4.7 per cent, will now be lowered to about 4 per cent.

The government said 바카라사이트 measure would wipe around A$1,200 from an average Help debt of A$26,500, with savings of about A$4,485 for graduates with much steeper A$100,000 debts.

Universities Australia said 바카라사이트 change would make repayment arrangements simpler and fairer. Chief executive Luke Sheehy said living costs influenced people¡¯s decision to enter university and finish 바카라사이트ir courses. ¡°This relief will give people more confidence in pursuing a degree while providing much-needed support for those already paying off a Help debt,¡± he said.

The Australian Technology Network said 바카라사이트 change would be a ¡°shot in 바카라사이트 arm¡± for people paying off student debts. ¡°It is extremely pleasing that calls to modernise 바카라사이트 student loans system have been heard,¡± said interim executive director Frank Coletta.

Troy Williams, chief executive of Independent Tertiary Education Council Australia (Iteca), said 바카라사이트 government¡¯s move would be ¡°most welcome for 바카라사이트 millions of people with student debt struggling to deal with cost-of-living pressures¡±.

Shadow education minister Sarah Henderson said this year¡¯s indexation would still be 바카라사이트 highest in 23 years. Shadow treasurer Angus Taylor noted that WPI was expected to exceed CPI in 바카라사이트 near term.

john.ross@ws-2000.com