Kate Ellis (Adelaide, Australian Labor Party, Minister for Employment Participation and Childcare) Share this | Hansard source

I thank the member for Blair as well as the other members who have spoken in this debate on the impacts that this government’s changes to education, particularly higher education, are having on their constituents in their communities and on the substantial benefits the changes are bringing. In representing Minister Garrett, in summing up this debate, I also thank all of those members from both sides who spoke on the Higher Education Support Amendment (FEE-HELP Loan Fee) Bill 2010.

The bill amends the Higher Education Support Act 2003 to implement the government’s decision to increase the loan fee from 20 per cent to 25 per cent for FEE-HELP for fee-paying undergraduate students. An increase in the loan fee applying to FEE-HELP debts incurred from 1 January 2011 will enable the government to recover more of the taxpayer-subsidised cost of providing FEE-HELP loans, giving effect to the recommendation that was part of the Bradley Review of Australian Higher Education. Even with a five per cent increase in the loan fee, the conditions of the government’s FEE-HELP scheme continue to provide an extremely favourable income-contingent loan for students. Contrasting with commercial loan schemes, FEE-HELP loans are not means-tested, do not require security, are interest free, are indexed only to maintain real value and have income contingent repayment arrangements. Students do not have to start repaying their HELP loan until their income reaches the minimum repayment threshold of $44,912. If students do not repay their loan, the government meets that cost. The majority of students will not be affected by the change which will impact only on undergraduate students who choose to use FEE-HELP for their tuition fees in a fee-paying place. With all of that in mind, I urge members to support the bill.

Question agreed to.

Bill read a second time.

Ordered that the bill be reported to the House without amendment.

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