The HECS threshold is being increased and debts are being lowered but repayment times will take longer for some under a new proposal from

HECS threshold increasing, debts decreasing, but repayment times extending

What's changing?

The Higher Education Loan Program (HELP) repayment income threshold is increasing, and HELP debts will be reduced for some graduates under a new proposal by the Australian Government.

The HELP repayment income threshold will increase from $47,014 to $48,361 on July 1, 2023. This means that graduates will not have to start repaying their HELP debt until they earn above this threshold.

The Government will also reduce HELP debts for some graduates by up to $10,000. Graduates who have a HELP debt of $10,000 or less will have their debt wiped clean. Graduates with a HELP debt of between $10,000 and $30,000 will receive a partial debt reduction.

How will this affect me?

If you are a HELP debtor, the changes will affect you in the following ways:

You will not have to start repaying your HELP debt until you earn above the new repayment income threshold of $48,361.
If you have a HELP debt of $10,000 or less, it will be wiped clean.
If you have a HELP debt of between $10,000 and $30,000, you will receive a partial debt reduction.

What are the implications of these changes?

The changes to the HELP program will have a number of implications for students and graduates.

On the one hand, the changes will make it easier for graduates to repay their HELP debts. The increased repayment income threshold means that graduates will not have to start repaying their debts until they are earning a higher income.

The debt reduction will also help graduates to repay their debts sooner. Graduates with a HELP debt of $10,000 or less will have their debt wiped clean, and graduates with a HELP debt of between $10,000 and $30,000 will receive a partial debt reduction.

On the other hand, the changes will also mean that graduates will have to repay their debts over a longer period of time. The Government has proposed to increase the maximum repayment period for HELP debts from 10 years to 15 years.

The changes to the HELP program are a significant change to the way that HELP debts are repaid. Graduates should carefully consider the implications of these changes before making any decisions about their HELP debt.