Yes, Mr Pyne definitely needs to look into recovering the HECS debt ASAP. He shouldnt take notice of the protesters today. A fair system where taxpayers are considered is needed. I dont want my taxes paying for student unions either. So defund those thanks Mr Pyne. They are in effect a political grant and have nothing to do with education levels. Divert the money to appropriate educational needs. Thank you FULL ARTICLE UNPAID HECS debts accrued by university graduates who work overseas have already cost the government more than $400 million in unrecovered loans and will soon pass the $1 billion mark, according to Australian National University researchers. The study by economist and creator of HECS Bruce Chapman and actuarial expert Tim Higgins found that the accumulated cost had already reached $400m to $500m and was accelerating. The real loss is likely to be much higher because the estimates did not include debts accrued by postgraduates, full fee-paying students and people who had not graduated. Professor Chapman said the issue was an irritant in the HECS system. Everyones known this has been an inequity for a very long time, he said. If people are going overseas for good jobs, or spending a year or two floating around Europe and earning enough money to get by, its not in the philosophical framework of what HECS is all about. A lot of people think its unfair. But the researchers found the data available on the issue was extremely sparse, even by the standards that apply to most social science investigation. They were forced to make assumptions including the number of debtors, how much they owed and how many regularly worked full time. They also needed to make assumptions about wage growth, indexation and inflation, and to estimate how many graduates worked overseas, how long they did so and how long they worked in Australia first. Their modelling found forgone HECS from graduates who had started studying in 1989, when HECS was introduced, had totalled about $3m. Within a decade that had blown out to $15m a year, and after tuition fees went up in 2000 it leapt to $25m a year. It now stands at about $27m a year, suggesting an accumulated debt of about $440m this year. These figures assume people have studied for four-year degrees and emerged to low graduate salaries and employment rates, with about half of those who work overseas doing so only temporarily. Professor Chapman said the team had kept its estimates deliberately conservative. The effects in any short period are quite small, but over a 20-year period were talking about ($500m) or more. It really matters. He was surprised governments hadnt tackled the problem in the 22 years since HECS had been introduced. People assumed most of the graduates came back anyway. But it still costs when theyre overseas because youve got the interest rate subsidy on debt. The team has proposed a HECS debt obligation contract as a straightforward way of recovering the money. It would oblige debtors to inform the Australian Taxation Office if they left the country for more than six months and to pay off their debts to the tune of about $1900 a year, a small sum in the context of the likely financial circumstances of HECS debtors employed outside Australia, the researchers said. They said it would be expensive or impractical to collect the money through international income tax agreements or HECS-style systems in other countries. - See more at: theaustralian.au/higher-education/unrecovered-hecs-debts-are-heading-towards-1bn/story-e6frgcjx-1226323201326#sthash.lFIaILam.dpuf
Posted on: Wed, 30 Oct 2013 07:15:54 +0000
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