Jess Walsh (Victoria, Australian Labor Party, Minister for Early Childhood Education) Share this | Hansard source

I thank Senator Faruqi for her amendment. The government will not be supporting this amendment. I note that abolishing indexation was considered by the Senate Standing Committees on Education and Employment in 2023. The committee recommended that the Senate not pass that bill. Indexation plays an important role in ensuring that loans maintain their real value over time and reinforces the long-term financial sustainability of the HELP system and other loan systems.

The government recognised that the system could be better and fairer. That's why, last year, we passed legislation to cap indexation to the lower of CPI and WPI, and backdated that change to 1 June 2023. That cut around $3 billion in student debt for more than three million Australians. It ensures that debts won't grow faster than wages in the future. Our changes provide relief for students and young people while continuing to protect the integrity and value of the HECS system, which has massively expanded higher education access for millions of Australians. This bill wipes another $16 billion from student debt and delivers important structural reforms to repayments, which will benefit generations to come.