The Labor government have recently introduced legislation aimed to enact its election promise to reduce student debt by 20%.
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The Bill proposes to:
increase the minimum repayment threshold from $54,435 in 2024–2025 to $67,000 in 2025–2026
provide a one-off 20% reduction to Higher Education Loan Program (HELP) debts and certain other student loans that are incurred on or before 1 June 2025;
introduce a marginal compulsory repayment system based on income above the new $67,000 threshold rather than a percentage of the repayment income.
Introduce cap on level of indexation to lower amount of either the consumer price index (CPI) or the wage price index (WPI).
