Getting Tough on HECS.

Education fees lay deep in the heart of the political divide.   The Socialist left believes that all forms of education should be free and many holding that conviction seek ways of dodging repayment of what were once knows as HECS and which have been renamed HELP.  These are the fees accrued from attending Australian universities and earning degrees which move the qualified into higher earning brackets.

Basically, HELP is a government loan issued on the basis of repayment being deferred until the salary earned reaches a level when reducing that loan becomes affordable.  Of course, audit on earnings is within the orbit of the Australian Tax office, hence a person with HELP debts is continually evaluated wherever they are employed within this country.

There seems to be an ever increasing backlog of unpaid HELP debts and much of this can be attributed to those gaining academic qualifications moving overseas to work, and avoiding the scrutiny of the Australian Tax office.  Now the ATO has signalled that it will use data matching technology to identify the culprits and that existing complimentary tax arrangements with many other overseas tax regimes may force debt repayment compliance.   In extreme cases, the Tax office may issue a "Departure Prohibition Order " to prevent a debtor leaving the country until a satisfactory repayment agreement is in place.

Many people have the strange notion that HELP debt only applies when a person is successful in gaining a degree.   Those that fail or simply discontinue a course took up a place at a university that could have been used by others and attracted the same costs of course provision that applied to successful students - and their debt accrued is equally repayable.   Just because a person achieves a HSC at a level that entitles them to enroll at a university does not ensure they will be successful in attaining a qualification.   Many are better suited to a less academic career in the various trades, which are now delivering pay packets at professional levels.

There will always be a shortfall in recovering HELP debt.   Many leave school with high aspirations and quickly find that university does not meet their needs and drop out, and their future earnings never reach the level that enforces repayment.   We encourage prisoners in the jail system to rehabilitate themselves.  Often they earn higher qualifications, but continue crime on release and their earnings remain in the cash economy, safe from audit by the ATO.

Women are now the major gender studying at University but most professions maintain an imbalance between the salaries paid to men with women earning a lesser amount.  It usually takes women longer to reach the salary level of automatic debt repayment and in some cases they drop out of the workforce to raise a family, and later return on a part time basis and never attain repayment salary level.

Then there are what are termed "professional students ".  Welfare in generous to those undertaking study and some people continue to attract qualifications over a lifetime without ever applying them to any form of employment.

What is becoming increasingly clear is that university debt is going to tighten and the days of frivolously taking on a university course on a whim are coming to an end.   Serious money is involved and the economy will enforce repayment to keep education costs under control. Students will find that finances in future will be on a much tighter leash !