Critics of soaring indexation on student debts have welcomed the education minister’s commitment to look into an accounting quirk in the way loans are indexed which could save graduates hundreds of dollars in repayments.
Hecs debts rise annually with inflation on 1 June, but loan repayments aren’t processed until tax returns are lodged, which can be months later. This means indexation is applied to portions of debts already paid – often by thousands of dollars.
