The Australian Government has announced significant changes to the way HELP loans will be indexed, effective from 1 June 2023, subject to the passage of legislation.
More than 3 million Australians with a student loan will benefit from a proposed cap to the HELP indexation rate to be rolled out in the upcoming budget. Around $3 billion in student debt will be wiped.
In response to the Australian Universities Accord, the Government will cap the HELP indexation rate to be the lower of either the Consumer Price Index (CPI) or the Wage Price Index (WPI) with effect from 1 June 2023. The changes will apply to all HELP, VET Student Loan, Australian Apprenticeship Support Loan and other student support loan accounts that existed on 1 June last year. It will also fix last year’s spike in the CPI indexation rate of 7.1 per cent and prevent it from happening again.
Australians with a student loan can use the HELP Indexation Credit Estimator to see how they can benefit from these changes.
Estimated indexation credit for HELP debtors
| HELP DEBT at 30 June 2023 | TOTAL ESTIMATED CREDIT FOR 2023 AND 2024* |
|---|---|
| $15,000 | $675 |
| $25,000 | $1,120 |
| $30,000 | $1,345 |
| $35,000 | $1,570 |
| $40,000 | $1,795 |
| $45,000 | $2,020 |
| $50,000 | $2,245 |
| $60,000 | $2,690 |
| $100,000 | $4,485 |
| $130,000 | $5,835 |
*Actual credit amount will vary depending on individual circumstances including repayments made during the year. All HELP debts that were indexed in 2023 and are subject to indexation on 1 June 2024 will receive an indexation credit.
Minister for Education Jason Clare said:
This will wipe out around $3 billion in student debt for more than 3 million Australians.
We are doing this, and going further. We will backdate this reform to last year. This will wipe out what happened last year and make sure it never happens again.”
This is part of the first stage of reforms the Albanese Government will implement in response to the Universities Accord.
Learn more about the reform Higher Education Loan Program (HELP) - Indexation Credit Estimator.