Joint media release - Labor’s HECS debt chaos is a mess of its own making, Sunday May 5 2024

Monday, 06 May 2024

Fuelled by high inflation because the Albanese Government can’t get spending under control, Labor’s HECS debt chaos is a mess of its own making.

“Today’s announcement is all trickery and deceit and doesn’t fix Labor’s student debt trap that has hit 3 million Australians,” Senator Henderson said.

“Under Labor, student debts will still increase by a crippling 11.1% (3.9%, 3.2% and 4% as reported), driving up the average loan by $2,800.

“A HELP-HECS indexation rate of 4% this year would be the highest in 23 years.

“Under the Coalition’s strong economic management, low inflation meant indexation averaged just 1.7% pa.

“Whether it’s student debt, housing or paying the bills, young Australians continue to suffer acute cost-of-living pain under this incompetent Labor government,” Senator Henderson said.

Shadow Treasurer Angus Taylor said student debt is only skyrocketing because of Labor’s homegrown inflation.

“Australians are paying the price for Labor’s economic mismanagement. The best way to address growing HECS debts is to fight Labor’s homegrown inflation at its source by reining in spending and strong budget management. Instead, Labor has let spending and inflation run out of control to the point that inflation is now stubborn, sticky, and homegrown.

“Today’s announcement is a glaring admission from Labor that real wages have been going backwards under their government.

“The policy announced will provide marginal relief to Australians struggling to pay down their debts with the rising cost of living, with experts expecting that over the next year indexation will still exceed 4%.

“With the last budget forecasting WPI to exceed CPI from 2023-24, this change will only have an impact if Labor are expecting further collapses in real wages like Australians have experienced since the election.

“There remain a number of questions Labor must clarify, including what the backdated proposal will mean for students who paid down their debts following the 7.1% indexation.

“Labor’s response to inflation continues to put band aids on bullet wounds. To provide cost of living relief for all Australians, Labor must deliver a budget that puts downward pressure on its homegrown inflation.”