Mehreen Faruqi (NSW, Australian Greens) Share this | Hansard source

I move Greens amendment (1) on sheet 3370:

(1) Page 22 (after line 30), after Schedule 1, insert:

Schedule 1A — Ending indexation of student debts

Part 1 — Amendments of the Australian Apprenticeship Support Loans Act 2014

Australian Apprenticeship Support Loans Act 2014

1 Section 5

Repeal the following definitions:

(a) definition of AASL debt indexation factor;

(b) definition of CPI indexation factor.

2 Section 5 (definition of index number )

Omit "section 33", substitute "section 99A".

3 Section 5

Repeal the following definitions:

(a) definition of WPI indexation factor;

(b) definition of WPI index number.

4 Section 30 (paragraph (a) of the paragraph beginning "In stage 1")

Repeal the paragraph.

5 Subsection 31(1)

Omit all the words before the method statement, substitute:

(1) A person's former accumulated AASL debt, in relation to the person's accumulated AASL debt for a financial year, is the amount worked out using the following method statement.

6 Sections 32, 33 and 34

Repeal the sections.

7 Subsection 99(5) (note)

Omit "section 33", substitute "section 99A".

8 After section 99

Insert:

99A Meaning of index number

(1) The index number for a quarter is the All Groups Consumer Price Index number, being the weighted average of the 8 capital cities, published by the Australian Statistician in respect of that quarter.

(2) Subject to subsection (3), if, at any time before or after the commencement of this Act:

(a) the Australian Statistician has published or publishes an index number in respect of a quarter; and

(b) that index number is in substitution for an index number previously published by the Australian Statistician in respect of that quarter;

disregard the publication of the later index number for the purposes of this section.

(3) If, at any time before or after the commencement of this Act, the Australian Statistician has changed or changes the index reference period for the All Groups Consumer Price Index, then, in applying this section after the change took place or takes place, have regard only to index numbers published in terms of the new index reference period.

Part 2 — Amendments of the Higher Education Support Act 2003

Higher Education Support Act 2003

9 Section 129-1

Omit ", or the indexation of that debt,".

10 Paragraph 140-1(2)(a)

Repeal the paragraph.

11 Subsection 140-5(1)

Omit all the words before the method statement, substitute:

(1) A person's former accumulated HELP debt, in relation to the person's *accumulated HELP debt for a financial year, is the amount worked out using the following method statement.

12 Subsection 140-5(1) (example)

Repeal the example, substitute:

Example: Lorraine is studying part-time for a Degree of Bachelor of Communications. On 1 June 2013, Lorraine had an accumulated HELP debt of $15,000. She incurred a HELP debt of $1,500 on 31 March 2013. She made a voluntary repayment of $525 on 1 May 2014. Lorraine lodged her 2012-13 income tax return and a compulsory repayment amount of $3,000 was assessed and notified on her income tax notice of assessment on 3 September 2013.

To work out Lorraine's former accumulated HELP debt on 1 June 2014:

Step 1: Take the previous accumulated HELP debt of $15,000 on 1 June 2013.

Step 2: Add the HELP debt of $1,500 incurred on 31 March 2013.

Step 3: Subtract the $525 voluntary repayment made on 1 May 2014.

Step 4: Subtract the $3,000 compulsory repayment assessed on 3 September 2013.

Steps 5 and 6: Do not apply because since 1 June 2013 Lorraine had no amendments to any assessment.

Lorraine's former accumulated HELP debt on 1 June 2014 is:

($15,000 + $1,500)—($525 + $3,000) = $12,975

13 Sections 140-10, 140-20, 142-10 and 144-5

Repeal the sections.

14 Section 198-1 (note 1)

Repeal the note, substitute:

Note 1: A different method of indexation is used for the indexing of HELP repayment thresholds under section 154-25.

15 Section 206-1 (table item 2AA)

Repeal the table item.

16 Subclause 1(1) of Schedule 1

Repeal the following definitions:

(a) the definition of CPI indexation factor;

(b) the definition of HELP debt indexation factor;

(c) the definition of WPI indexation factor.

Part 3 — Amendments of the Social Security Act 1991

Social Security Act 1991

17 Section 19AA (definition of HELP debt indexation factor )

Repeal the definition.

18 Section 1061ZVEA (paragraph (a) of the paragraph beginning "In stage 1")

Repeal the paragraph.

19 Subsection 1061ZVEB(1)

Omit all the words before the method statement, substitute:

(1) A person's former accumulated SSL debt, in relation to the person's accumulated SSL debt for a financial year, is the amount worked out using the following method statement.

20 Section 1061ZZEP

Repeal the section, substitute:

1061ZZEP How to work out FS debt

The FS debt is the amount outstanding under the contract at the termination date.

21 Subsections 1061ZZER(2) and (3)

Repeal the subsections, substitute:

(2) A person's accumulated FS debt referred to in subsection 1061ZZEQ(2) is an amount worked out by adding together:

(a) the person's adjusted accumulated FS debt on the earlier date; and

(b) any FS debt, or the total of any FS debts, of the person that did not exist on the earlier date.

22 Section 1061ZZET

Repeal the section.

23 Subsection 1061ZZEU(3)

Omit "1061ZZET", substitute "1061ZZES".

Part 4 — Amendments of the Student Assistance Act 1973

Student Assistance Act 1973

24 Subsection 3(1) (definition of HELP debt indexation factor )

Repeal the definition.

25 Section 9A (paragraph (a) of the paragraph beginning "In stage 1")

Repeal the paragraph.

26 Subsection 9B(1)

Omit all the words before the method statement, substitute:

(1) A person's former ABSTUDYaccumulated SSL debt, in relation to the person's accumulated ABSTUDY SSL debt for a financial year, is the amount worked out using the following method statement.

27 Subsection 12ZF(1)

Repeal the subsection, substitute:

(1) If, at the end of the contract period in relation to a financial supplement contract between a participating corporation and another person, there was an amount outstanding under the contract, the person incurs on 1 June immediately following the end of that period a debt (FS debt) to the Commonwealth equal to that amount.

28 Subsection 12ZF(3)

Repeal the subsection, substitute:

(3) If an FS debt or FS debts of a person that existed on 1 June in a year (the later date) are, or include, an FS debt or FS debts that existed on 1 June in the immediately preceding year (the earlier date), the person incurs on the later date an accumulated FS debt to the Commonwealth worked out by adding:

(a) the adjusted accumulated FS debt at the earlier date; and

(b) any FS debt, or the total of any FS debts, of the person that did not exist on the earlier date.

29 Subsections 12ZF(6), (6A), (7), (7A) and (7B)

Repeal the subsections.

Part 5 — Amendments of the VET Student Loans Act 2016

VET Student Loans Act 2016

30 Section 23CA (paragraph (a) of the paragraph beginning "In stage 1")

Repeal the paragraph.

31 Subsection 23CB(1)

Omit all the words before the method statement, substitute:

(1) A person's former accumulated VETSL debt, in relation to the person's accumulated VETSL debt for a financial year, is the amount worked out using the following method statement.

32 Subsection 23CB(1) (example)

Repeal the example, substitute:

Example: Lorraine is studying part-time for a Diploma of Early Childhood Education and Care. On 1 June 2020, Lorraine had an accumulated VETSL debt of $15,000. She incurred a VETSL debt of $1,500 on 31 March 2020. She made a voluntary repayment of $525 on 1 May 2021. Lorraine lodged her 2019-20 income tax return and a compulsory VETSL repayment amount of $3,000 was assessed and notified on her income tax notice of assessment on 3 September 2020.

To work out Lorraine's former accumulated VETSL debt on 1 June 2021:

Step 1: Take the previous accumulated VETSL debt of $15,000 on 1 June 2020.

Step 2: Add the VETSL debt of $1,500 incurred on 31 March 2020.

Step 3: Subtract the $525 voluntary repayment made on 1 May 2021.

Step 4: Subtract the $3,000 compulsory repayment assessed on 3 September 2020.

Step 5: Does not apply because since 1 June 2020 Lorraine had no amendments to any assessment.

Step 6: Does not apply because since 1 June 2020 Lorraine had no amendments to any assessment.

Lorraine's former accumulated VETSL debt on 1 June 2021 is:

($15,000 + $1,500)—($525 + $3,000) = $12,975

Part 6 — Application provisions

33 Application of amendments

The amendments made by this Schedule apply in relation to working out an amount of debt as at 1 June 2025 and as at a later time.

This amendment actually removes indexation for all student debts. It won't cap the debts. It won't take the lower of CPI or WPI, because that's still unfair and adds masses of debt for students—debt that actually shouldn't exist.

The government's attempt to deal with runaway indexation has totally failed—I agree with Senator Henderson on that one—because Labor's so-called solution still means that the mountain of student debt keeps growing every year, even when people are not earning enough to pay it off. Labor's move to tie indexation to the lower of CPI or WPI still resulted in a student debt increase of 15 per cent between 2022 and 2025. This is completely unsustainable. And a one-off 7.9 per cent debt cut won't fix it, because indexation will quickly offset this debt relief.

If Senator Henderson is—and, indeed, if the coalition are—serious about doing something for students, they can actually support this amendment to scrap indexation altogether. I guess it is good to see them coming on to the side of students, because what they did a few years ago was to introduce the worst, crappiest, messiest piece of legislation—the job-ready graduates bill—which increased fees for students. Arts degrees, because of that, are now $50,000. So maybe the coalition can support this amendment and also my next amendment—to dump the jobs-ready-graduates fee-hikes—because, as long as indexation exists, young people will be stuck on the student-debt hamster-wheel, struggling to keep up with annual hikes. Indexation lengthens and grows student-debt sentences. It needs to go, and I urge senators to support this amendment.