Zali Steggall (Warringah, Independent) Share this | Hansard source

I want to echo the words from my colleagues on the crossbench, particularly in relation to this amendment from the member for Kooyong around the timing of indexation of the debt.

I have to admit I simply don't buy it. I really have to be very honest with my constituents in Warringah and with the people of Australia. I don't buy that it is not possible for the Australian Taxation Office to be able to adjust student debts in real time as payments are made so that when the time for indexation occurs it is done on the debt in real time. I just don't buy it. It doesn't happen when you're paying off a mortgage when it comes to a house. Banks can't do it. You can't apply an interest rate to a loan balance from 12 months ago. You have to take into account repayments that have been made. It's the same when it comes to credit card debts. It's the same thing that happens with any other loan. I look at the child support system, where the government is able to go back in time and cause a single parent, for example, who's been found to have been overpaid on child support or family benefit payment to incur a liability to the state. So I just don't accept the explanation for the timing of indexation from the ATO that it is not practically possible to adjust this to make it a reflection of every other practice, whereby, if a person is repaying a debt periodically, when there is an indexation or a change of interest, that balance is adjusted in real time as repayments are made. It is just unacceptable that that is not changed.

I would say that the reason why there is objection to this from the government or from within the department is the money that's being made from this, because with the delay comes greater revenue for the government through that greater indexation on those balances. I think it is unconscionable that, ultimately, people do not have the benefit of the income that they are earning—that they are making periodic repayments and that that is not being applied in real time to the balance of their HECS debts. So I put it out there that I simply do not accept the explanations that have been given.

Young people and others incurring a HECS debt are absolutely contributing to the future of Australia. We know that, through every policy area, we have a huge skills shortage. We know, for example, that AUKUS—a massive investment of this government; we're hearing about it all the time—has a requirement for some 4,000 engineers. They will have to go through the university system. They will need to be qualified. They will incur HECS debts. We have all these areas that so fundamentally depend on Australians pursuing their education for the benefit of Australians. We know that, and yet we are making them incur disadvantage in an incredibly unfair system. I think it's an unconscionable system.

So I strongly echo the words of my crossbench colleagues. I commend the minister. I know he has engaged on the issues, and I welcome the fact that we are finally changing at least the rate of indexation, to take the lower of the CPI and the wage index. But it took over 12 months for that to happen. Meanwhile, there is great stress and impact on young people, on students and often on women who are retraining and going back to university to pursue career opportunities. I think it's a responsibility of the government to fix this without delay and to provide a rational explanation as to why this indexation timing isn't fixed immediately.

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