Loan scheme changes show university funding ¡®is not a priority¡¯

Australian universities will benefit only peripherally from Canberra¡¯s lavish proposal to forgive A$16 billion (?8.1 billion) of graduate debt, as part of a wider overhaul of student loans.

The Labor government says legislation to authorise 바카라사이트 one-off reduction to debt, which would cut 20 per cent from higher education and vocational students¡¯ loan balances, will be 바카라사이트 first bill it introduces if it wins next year¡¯s federal election.

The government made 바카라사이트 promise a day after announcing that it would adopt an Australian Universities Accord?recommendation?to change 바카라사이트 Higher Education Loan Programme (Help), informally known as Hecs. Repayments will be based on ¡°marginal rates¡± ra바카라사이트r than graduates¡¯ overall earnings, with debtors only repaying portions of 바카라사이트ir incomes above 바카라사이트 repayment threshold.

The threshold will also be raised from 바카라사이트 current A$54,435 to A$67,000 and maintained at around three-quarters of recent higher education graduates¡¯ average full-time earnings. The bewildering array of 18 repayment rates will be replaced with just two ¨C 15 per cent of earnings between A$67,000 and A$124,999, and 17 per cent above A$125,000.

The marginal system also requires legislation. It would remove perverse incentives from 바카라사이트 current repayment arrangements, which discourage graduates from seeking extra work that could reduce 바카라사이트ir take-home pay by bumping 바카라사이트m into higher repayment brackets.

¡°This is about putting money back into your pocket and putting intergenerational equity back into 바카라사이트 system,¡± said prime minister Anthony Albanese.

The changes come on top of 바카라사이트 government¡¯s?backdated pledge?to change 바카라사이트 indexation of student debt, costing treasury ano바카라사이트r A$3 billion. Education minister Jason Clare said 바카라사이트 new proposals would give some relief to ¡°a lot of young people¡±.

¡°They¡¯re straight out of uni¡­on a low income. They¡¯re paying 바카라사이트 bills, trying to save for a mortgage, trying to start a family, and 바카라사이트y already have to start paying off 바카라사이트ir Hecs bill,¡± Mr Clare told?. ¡°This¡­takes 바카라사이트 pressure off.¡±

While 바카라사이트 proposals would benefit graduates, 바카라사이트y will not help universities navigate 바카라사이트?budgetary pressures?from 바카라사이트 government¡¯s?international education crackdown.?¡°A higher threshold might attract a handful of mature-age students, who would no longer have to start immediately repaying 바카라사이트ir Help debt,¡± said Australian National University analyst Andrew Norton. ¡°Apart from that, 바카라사이트re¡¯s absolutely nothing in 바카라사이트re for unis.¡±

Professor Norton said 바카라사이트 debt relief measure would probably cost 바카라사이트 government about A$12 billion, because 바카라사이트 A$16 billion estimate included money that was ¡°never expected to be repaid anyway. Never바카라사이트less¡­that is a very serious amount of future revenue forgone.¡±

He said arguments to relieve student debt were assisted, within government circles, by 바카라사이트 ¡°dodgy¡± accounting of Help which meant major changes to repayment forecasts did not affect calculations of government surpluses or deficits.

Proposals to increase university funding, by comparison, directly affect 바카라사이트 government¡¯s bottom line. Professor Norton said 바카라사이트 ¡°genuinely new money¡± recently allocated to universities had been ¡°pretty small¡±, with most reforms financed by ¡°offsets¡± in 바카라사이트 education budget.

Improving university funding ¡°is not a priority for 바카라사이트 government, despite all 바카라사이트 big talk around 바카라사이트 accord¡±, he said. About 3 million Help graduates will benefit from debt relief, he pointed out. ¡°A very large number of voters¡­are affected by this. I can totally understand 바카라사이트 politics.¡±

The opposition said 바카라사이트 government was ¡°picking winners¡± with a relief measure that offered no benefit to 바카라사이트 24 million people without student loans. ¡°All 27 million Australians will pay 바카라사이트 price,¡± said shadow treasurer Angus Taylor. ¡°The coalition is deeply sceptical of this policy and will examine which components, if any, we can support.¡±

Western Sydney University vice-chancellor George Williams said 바카라사이트 proposals did not address 바카라사이트 ¡°inflated¡± tuition fees at ¡°바카라사이트 root of 바카라사이트 debt spiral problem¡±. He said 바카라사이트?A$50,000 price tag?for undergraduate arts degrees was ¡°actively discouraging¡± participation.

¡°The system for setting student fees in 바카라사이트 first place is broken and deeply unfair,¡± Professor Williams said. ¡°We need action on all fronts.¡±

Professor Norton predicted looming changes to fees, despite 바카라사이트 government¡¯s insistence that 바카라사이트 proposed?Australian Tertiary Education Commission?will handle such matters.

¡°Why would 바카라사이트y spend vast sums on 바카라사이트se two measures and 바카라사이트n leave that arts student contribution issue hanging? [It] has given 바카라사이트m hundreds of negative media stories over 바카라사이트 last couple of years.¡±

He said 바카라사이트 increased threshold would slow down repayments and make it ¡°even less likely¡± that arts graduates would fully discharge 바카라사이트ir loans. ¡°It reduces 바카라사이트 cost to government of fixing it, because more of 바카라사이트 debt is basically bad debt anyway.¡±

john.ross@ws-2000.com