Every year on June 1, student debt in Australia is indexed to inflation. In 2023, high inflation pushed the indexation rate to 7.1%, the highest since 1990.
This year, if there is no policy change, student debt balances will be increased by 4.7%.
After sustained community pressure to change the way debts are indexed, the federal government has announced plans to help students, apprentices and trainees.
How will student debts change?
This announcement is part of the 2024 federal budget on May 14. It has two components.
First, indexation for student loans will be based on whichever is lower: the Consumer Price Index (CPI), which measures inflation, or the Wage Price Index (WPI), which measures hourly wage rates in the same job.
Second, in…
Read the full article at: https://theconversation.com/the-good-news-is-the-government-plans-to-cancel-3-billion-in-student-debt-the-bad-news-is-indexation-will-still-be-high-229284