As we know, Australia is the perfect destination for higher studies, but the admission expenses are higher, which urges Australian students to think about whether to pursue higher education or not. Therefore, to ease these situations, the Australian Government has introduced a scheme called HECS, under which the government will pay course fees directly to the institution.
However, the heavy demand for HECS-HELP loans has loomed debt on Students. Recently, a newspaper, The Sydney Morning Heralds” published, “Three million Australian graduates might pay less for their university loans now because the government realized a mistake was making it harder for students.”So, in this blog, let’s learn more about this HECS-HELP scheme and why it has raised more loan debt among Australian students. Let’s start now!!
What is HECS-Help?
HECS is a loan plus a student discount. The Australian government implemented the Higher Education Contribution Scheme( HECS ) in 1989 to support students in their tertiary education. HECS under HECS-HELP was introduced in 2003. It has no interest, and repayments are not affected by inflation.
Under HECS, the Australian New Rules Government pays for students’ courses, such as tuition fees and other educational expenses, until they earn above a certain income threshold.
Types of Study Covered by HECS-HELP
Students who are going to opt for these studies can apply for HECS-HELP.
- Undergraduate degrees
- Associate degrees
- Graduate certificates
- Graduate diplomas
- Honors programs
- Some bridging courses for overseas-trained professionals
Who Are Eligible to Benefit from this HECS-HELP Scheme?
For those who are Applying for the higher education contribution scheme eligibility requirments is fixed by Australian authorities such as;-
- Australian citizens
- Permanent humanitarian visa holders
- New Zealand Special Category Visa holders who meet residency requirements
- Enrolled in a Commonwealth-supported place at an eligible higher education provider
- Meet the relevant citizenship and residency requirements set by the Australian Government.
How To Apply For an HECS-HELP Loan?
Here are the Steps one must follow while applying for the HECS loan such;-
Steps 1:- Check the eligibility, such as being an Australian citizen, a New Zealand Special Category Visa (NZ SCV) holder, or a permanent humanitarian visa holder. Also, you must be enrolled in a Commonwealth-supported place (CSP).
Step 2:- Obtain a Tax File Number (TFN)
Step 3:- Enroll in a CSP Course
Step 4:- Complete the eCAF (electronic Commonwealth Assistance Form) by login provided by your institution.
Step 5:- Fill Out the HECS-HELP Form by entering your details, including your TFN.
Step 6:- Check and submit the form
How Does HECS-HELP Work?
HECS is considered a student loan, where the Government entirely bears the cost of education. Once students start earning a specified income, they begin repaying their debt through the tax system. The amount refunded is proportional to their income, ensuring affordability for graduates.
However, the current scenario is doomed with heavy student debt; Jacob Atkins, who lives in London and works has a student debt of about $36,000; he manages to pay only about $500 a year. Another guy grim, 31-year-old, earning about $59,000 before tax, so given the cost of living and fail to repay the debt. – Stated in the Guardian News Portal
Before starting a line on how to find my hecs debt, first let know “ what is hecs debt” HECS debt is the student loan balance accrued under Australia’s HECS-HELP scheme, used to cover tertiary education costs.
How To Check Hecs-Help Debt Balance?
Are you wondering how to “check my hecs debt” then look out this section here:-
You must contact the ATO on 13 28 61 and give them your TFN. With this TFN, they will verify your details and tell you your HECS-HELP balance.
You can also check your HECS-HELP balance online via the myGov site. To do so, you need to link your account to the ATO so that you can view your balance online.
How HECS- Help Calculated?
HECS debt calculator includes this step;-
Step 1:- Check your university’s fee schedule and sum the costs for each unit or subject.
Step 2:- Plus the tuition fees for each semester or year to find your total HECS-HELP debt.
Step 3:- Use the repayment rates table to determine the percentage of your income you need to repay annually once you earn above the threshold.
HECS Debt Limits and Repayment for Australian Students
A HECS system policy was introduced in 2020 to limit student loan amounts. In 2023, students’ HELP loan limit was fixed at $113,028. The limit is higher for medicine, dentistry, aviation, and veterinary science courses, at $162,336. As of 2024, PER EFTSL, the HELP loan limit rises to $12,720 for these courses.
The average time to pay off HECS debt as of the end of June 2022 paid HECS debt was 9.6 years.
For example, if a student earns a gross salary of $60,000 every month, he has to pay HECS debt around 2.0 % of the interest from his income, which is $100 per month and $1,200 annually.
Get a more precise overview from the below table here how much income rate one must have and how much have to repay-
| Income Range (AUD) | Repayment Rate |
| Below $51,550 | 0% |
| $51,550 – $58,262 | 1.0% |
| $58,263 – $64,973 | 2.0% |
| $64,974 – $68,991 | 2.5% |
| $68,992 – $72,950 | 3.0% |
| $72,951 – $77,188 | 3.5% |
| $77,189 – $82,552 | 4.0% |
| $82,553 – $88,145 | 4.5% |
| $88,146 – $93,877 | 5.0% |
| $93,878 – $99,767 | 5.5% |
| $99,768 – $105,815 | 6.0% |
| $105,816 – $112,035 | 6.5% |
| $112,036 – $118,423 | 7.0% |
| $118,424 – $124,991 | 7.5% |
| $124,992 – $131,748 | 8.0% |
| $131,749 – $138,698 | 8.5% |
| $138,699 – $145,849 | 9.0% |
| $145,850 and above | 10.0% |
Can International Students Get HECS Loan?
If international students are applying for a HECS-HELP loan, they must study in a Commonwealth-supported place and be Australian citizens. A permanent humanitarian visa holder (or an eligible former permanent humanitarian visa holder) or an eligible New Zealand citizen who holds a Special Category visa (SCV)
Reasons For Increasing HECS-HELP Debt Among Australian Students
Earlier, this blog above here discussed how loan debt is increasing among Australian Students and why;-
Rising Tuition Fees:
The rise of tuition fees across Australian universities has significantly increased educational debt.
Expansion of Higher Education:
With higher demand for advanced learning education and increasing enrollment rates, more students taking HECS-HELP loan. As a result, they accumulate HECS-HELP debt as they pursue their academic aspirations.
Economic instability
Economic instability forces many students to rely on HECS-HELP loans to cover the unaffordable upfront costs of tertiary education.
Limited Government Funding:
Insufficient government funding forces universities to charge high tuition fees, increasing students’ reliance on HECS-HELP loans to cover expenses..
Why Does HECS Debt Affect Australian Students?
Many students in Australia fail to get quality education and need help to establish a better career due to money constraints. So, HECS-HELP is a lifeline for them. Many students have been privileged to get this loan but, unfortunately, fail to repay it as it raises the debt burden. So here, let’s look closer at how HECS debt affects Australian students:
Financial Burden
HECS debt is a financial burden for graduates, reducing disposable income and delaying major life goals like buying a house, starting a family, or investing in businesses. This, combined with the cost of living and HECS repayments, increases financial stress.
Impact on Career Choices
Students struggle to pursue passions in low-paying fields like non-profits or the arts due to HECS debt, forcing them into high-paying jobs. This economic pressure stifles creativity, limits career diversity, and discourages further education or gap years for personal growth.
Psychological Effects
The debt burden also impacts students psychologically. Lingering debt burden raises stress, anxiety, and even depression, which affects students’ overall mental health as well as their overall well-being.
Why HECS Debt Is Called A Failed Scheme?
A source from The Australian Institute says it is a failed scheme for Australian students for various reasons, such as
- The high debt burden among students during 2022-23 crosses 57% to 145 %, with an average debt rate of around $30,763.
- The HECS-HELP debt amount is not repaid because some borrowers are not earning or even being able to repay the full amount before it is forgiven at retirement or death. This could lead to billions of dollars as student loan burdens on their heads.
- Other factors also come off when there is an equity difference in distributing loans to the lower socio-economic backgrounds.
- The scheme has grown in complexity over time, with various repayment thresholds, rates, and conditions changes.
Conclusion
The blog is the ultimate guide for you all who want to know what HECS debt is. Along with other relevant information on why HECS loans affect more students in Australia, briefed here more lucidly so that there can be more ideas on debt burden among Australian students.
FAQs
How does HECS debt work in Australia?
The HECS debt works in Australia, where the Australian Government pays the loan amount directly to the university. The Australian taxation system makes the loan repayments when someone’s income reaches a certain threshold.
Do I have to pay back my HECS debt?
One can pay their loan when income rises above a certain threshold via taxation.
Is HECS only for Australian citizens?
To access a HECS-HELP loan, a student must study in a Commonwealth-supported place or be an Australian citizen. A permanent humanitarian visa holder (or an eligible former permanent humanitarian visa holder), an eligible New Zealand citizen who holds a Special Category visa (SCV)
