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Hit by the Omnibus – Higher Ed budget cuts through Parliament

Image sourced from: https://pixabay.com/

Image sourced from:
https://pixabay.com/

The Budget Savings (Omnibus) Act 2016 was assented to on 16 September 2016 and has made a number of amendments to the Higher Education Support Act 2003 (HESA).

The Act contains provisions that will affect future funding for the Higher Education sector and tertiary student HELP repayments.

  • From 1 January 2018, the indexation method used to calculate annual increases to university grant funding and regulated student contribution amounts will be based on the Consumer Price Index (CPI). HESA will be amended to remove the Higher Education Grants Index (HEGI) as the relevant indexation method.
  • Student loan repayment obligations will commence at the lower income threshold of $51,956 beginning 2018-2019. Repayments will commence at a new repayment percentage of 2% (up to $57,730). Repayment percentages continue to increase with income levels but there has been some adjustment to the income thresholds for each percentage. Income thresholds will still be indexed annually. Division 154 of HESA will be amended accordingly.
  • The HECS-HELP benefit program will be discontinued from 1 July 2017. This program provided a reduction to HECS-HELP repayments of around $1800 to graduates in targeted occupational areas, such as early childhood education, teaching and nursing. Division 157 of HESA will be removed.
  • The Student Start-up Scholarship Program was replaced by a Student Start-up Loan Scheme in 1 January 2016. These loans are income contingent and repayable in the same way as HELP. The Student Start-up Scholarship will no longer be available to existing student scholarship recipients from 1 July 2017. These students can apply for start-up loans.

 

 

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