You’re Gonna Have To Start Paying Your HECS Debt Back Much Sooner, Starting From Sunday
Earning $45,000? Congrats, you're now over the HECS threshold.
Great news for struggling young people — you’ll now have to start paying your HECS debt back heaps sooner, after the Government secured the support it needed to drop the repayment threshold to just $45,000. Oh, and the new plan will likely start this Sunday. Like, in four days. You’re welcome.
At the moment, the HECS repayment threshold is set at $56,000, which means you only need to start paying back your uni fees once you’re earning at least that much. Yesterday, the Government locked down the support it needs in the Senate to reduce that threshold from $56,000 to $45,000.
With that support, the bill is expected to pass by the end of this week, meaning that from Sunday onwards uni graduates earning more than $45,000 will need to start paying back at least 1 percent of their taxable income.
A $45,000 salary works out at about $700 a week after tax, FYI. It’s not a lot of money.
Good news all, I have finally hit the HECS repayment threshold!! Not because I got a raise and finally got a good wage but because they just decreased the threshold lol
— Gym Rat Rosie ? (@ratrosie) June 26, 2018
The lowering of the HECS repayment threshold will be forcing 185,000 additional people to start paying back their fees, and 62 percent of them are women.
— Andrew Bartlett (@AndrewBartlett) June 26, 2018
Try being a young single graduate living in Sydney on $45,000 and paying HECS debt as well as rent & everything else #auspol
— Wendy Bacon (@Wendy_Bacon) June 26, 2018
The new repayment threshold is another part of the Government’s Budget 2018 plan to basically only benefit rich people. Seriously — just last week they got rid of the second highest tax bracket, meaning that by 2024 someone earning $200,000 will be paying tax at the same rate as someone earning $41,000.
This HECS threshold change is a way for them to claw back some of the money they gave away by cutting taxes, meaning they’re pretty much just taking money from young people in low-paying jobs and giving it to people on really high incomes.
Greens leader Richard di Natale has described it as “intergenerational theft”, and he’s not wrong — many of the politicians who cooked up this plan went to uni when it was totally free, and never had to pay back any kind of debt.
Radical solution to higher-education debt: backdate the HECS system and make every MP who benefited from a FREE university education (and earn a lot more than $700 a week) pay back what their degree would have cost, with interest. Problem solved. #auspol #highered
— Nicole Krause (@nicoleckrause) June 26, 2018
In addition to lowering the repayment threshold, yesterday’s bill also puts a lifetime cap on HECS loans, limiting them at $104,440 for most students. The silver lining is that if you go over that limit, you can still access further loans if you’ve started to pay it off. That lifetime cap will start in 2020.