How do we protect students from ballooning HELP debts? A fixed maximum indexation rate would help – The Conversation

The indexation of student debt is arguably the federal governments biggest political problem when it comes to universities.

Last June, student debt balances increased by 7.1%, the highest rate in decades. While HELP loans do not attract interest, they are indexed to inflation as measured by the Consumer Price Index (CPI).

When inflation remained low, this was not an issue for those with a HELP debt. But last year, as inflation rose, on average A$1,700 was added to each borrowers debt. The next indexation date is approaching on June 1. We wont know the 2024 indexation rate until the March quarter CPI level is released, but its likely to be around 5%.

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