The Federal Government will cut the student debt of more than three million Australians in this month’s budget, including 17,424 in the electoral division of McEwen.
In a bid to ease the cost-of-living pressures off young people and fight against inflation, the Federal Government will wipe around $3 million in student debt, reverting the effects of last year’s spike in the CPI indexation rate of 7.1 per cent.
Federal Member for McEwen Rob Mitchell praised the government’s response to the indexation spike.
“I’ve heard from students and people with student loan debt who were shocked at last year’s spike in indexation. This government has listened to you and now we’re taking action.
“This will make the system fairer and benefit all Australians with a HELP debt.”
In response to the Australian Universities Accord, the government will also cap the HELP indexation rate to be the lower of either the Consumer Price Index (CPI) or the Wage Price Index (WPI) with the effect backdating to June 1, 2023.
Based on the new indexation credit, an individual with an average HELP debt of $26,500 will see around $1,200 wiped from their outstanding HELP loans this year, pending the passage of legislation.
Tax breaks will also be made available to those who have paid off their student debts in the last year.
“We are doing this and going further. We will backdate this reform to last year. This will wipe out what happened last year and make sure it never happens again,” Mr Mitchell said.
“This continues our work to ease cost-of-living pressures, and reduce and remove financial barriers to education and training.
“By backdating this reform to last year, we’re making sure that those with student loans affected by last year’s jump in indexation get this important cost-of-living relief.”
