Your HECS-HELP Debt Will Rise by Approximately 4.8 per cent This June

This is after it rose by 7.1 per cent last year. 

Thanks to data released by the Parliamentary Library, we’ve learnt that HECS-HELP loans are set to rise by approximately 4.8 per cent this June.

While it’s much lower than last year’s 7.1 per cent, this is still the second highest jump in the last decade.

Earlier this year an independent report was released by the Australian Universities Accord which found Australia’s current university system was ‘world-leading’ but could do better.

Students are still waiting (fingers crossed) to see if the government takes these changes into consideration.

Quick recap: what is indexation?

Indexation is applied to your existing HECS-HELP debt to “maintain its real value by adjusting it in line with changes in the cost of living”, according to Study Assist.

So, while there’s no interest charged on HELP-HECS, indexation is usually added to your debt every year. It’s added on 1 June every year.

And how is the rise in indexation calculated?

The rise in indexation is calculated by combining the consumer price index (CPI) numbers for the four quarters to March and dividing that by the same figure for the previous year.

In translation this means, the indexation method basically adjusts the amount of an asset’s costs by the rate of inflation. And it’s based on the CPI.

What about this year’s rise in indexation?

It’s worth noting that the Australian Tax Office (ATO) have not confirmed how much the rise in indexation will be for 2024.

The rise in debt by 4.8 per cent was calculated based on projections made by The Greens Party based on data from the Parliamentary Library.

Some news outlets have reported that indexation will be 4.7 per cent while others have reported it will rise to 4.8 per cent.

There could be some assistance.

While no one has confirmed any assistance with the rise of HECS debts, the government will announce the Federal Budget on 14 May.

Prime Minister Anthony Albanese has previously hinted that there might be some assistance for students, but nothing is confirmed.

Earlier in April Mr Albanese said, “there’s a range of areas we need to do much better for the younger generation and HECS is one of them.”

So, RN we’re all just waiting and watching 🤷‍♀️