David Smith (Bean, Australian Labor Party) Share this | Link to this | Hansard source

My question is to the Minister for Education. How is the Albanese Labor government helping Australians with a HECS debt into homeownership? What has been the response?

Jason Clare (Blaxland, Australian Labor Party, Minister for Education) Share this | Link to this | Hansard source

Can I thank my good mate the member for Bean for his question. As I said earlier this week, HECS shouldn't be a handbrake on buying your first home. We want more young Australians to be able to buy a home and that means building more homes and it means making it easier to buy them. That's what the five per cent deposit policy is all about, and that starts in just over a month, on 1 October. We're getting rid of that 20 per cent deposit that you used to have to save up for. We've also got rid of 20 per cent of student debt, cutting student debt by 20 per cent. That will help too. That'll take a massive weight off the shoulders of about three million Australians. The average HECS debt today is about 27 grand, so that 20 per cent cut will cut that debt by about 5½ thousand bucks, and that's a big help. As one uni student, a young bloke called Adam, told me back in November last year, 'It's going to make me able to buy a house sooner and to do all the things that I want to do.'

But we haven't just cut student debt by 20 per cent. We've also cut the amount that you have to repay on your student debt every year. If you earn about 70 grand a year at the moment, we've cut the amount that you have to repay every year by about $1,300. That helps too. That's real cost-of-living relief. It means more money in your pocket rather than the government's and it means more money that you can put towards that five per cent deposit.

We're also working with the banks on this, to make sure that your HECS debt doesn't make it harder to get a home loan. One of the recommendations in the universities accord—recommendation 16e—is that we should review bank practices to make sure that they recognise that HECS is different to other loans. The truth is HECS debts are different to other debts like credit card debts or personal loans, because you can't default on a HECS debt, so they should be treated differently by the banks. That's why the Treasurer asked APRA to look at this. That's why APRA issued new guidance to the banks about this, and I'm glad to see that a number of banks have already acted. The National Australia Bank, for example, announced last month that student debts of $20,000 or less wouldn't affect how much someone could borrow. So that is good news.

We're cutting student debt and we're making it easier for young Australians just out of uni or just out of home to buy their first home. We promised it before the last election, and now we're delivering