The Albanese government has made a host of promises to reduce student debt, introduce more free TAFE places and increase the HECS threshold if re-elected.

The policies, however, have left some questioning if it is the best way to strengthen Australia’s higher education system or the budget’s bottom line.

Prime Minister Anthony Albanese made the promise to slash 20 per cent off HECS debts, increase the repayment threshold to $67,000 and introduce 100,000 fee-free TAFE places each year at a Labor event in Adelaide over the weekend.

Ngaire Bogemann, president of the National Union of Students, said she has had “a mixed reaction” to the announcement.

“In theory, we aren’t going to say no to wiping student debt, but in a lot of ways it does just seem like a catchy headline to bring in votes as opposed to meaningfully addressing the actual root issues with HECS at the moment,” she said.

“From a student standpoint, what everyone wants is access to higher education and a chance to fully and fairly enjoy your time, be it at uni or TAFE.”

She said she fails to see how the two HECS policies “come together to make meaningful long-term change” when students are struggling with placement poverty and cost of living.

“There is a lot of talk about creating a fairer and more accessible higher education system, but I’m not convinced that is what these changes are achieving,” Bogemann said.

“It is dangling the carrot in front of young voters and there are many other things we’d like to see.”

Pros and cons

The Albanese government’s announcement followed other reforms to HECS earlier in the year, which tied indexation increases to the lower of either the consumer price index or wage-price index.

Angel Zhong, a professor of finance at RMIT University, said there are pros and cons of increasing the threshold before repayment is mandatory.

“You either have a higher annual payment and a shorter payment period or the other way around,” she said.

“There are benefits of course, like early career graduates having more liquidity.”

She said that all policies, from reducing HECS debt to free TAFE courses, have to be funded from somewhere in the federal budget.

“It will reduce the financial burden of approximately three million Australians, but it is increasing the financial burden of the government,” Zhong said.

“It increases the equity in the system, given the cost-of-living crisis, but measures always come with a cost.”

Opposition

The Coalition has already flagged that it is unlikely to support the policies, with shadow finance minister Jane Hume calling the relief plan “irresponsible”.

“It favours those university students that have higher incomes in the longer term,” she said.

“It’s those that haven’t gone to university or those that have already paid off their debts that will pay the price through higher taxes.”

Jane Hume and the Coalition are labelling the changes ‘irresponsible’ and ‘unfair’.  Photo: AAP

Paul Fletcher, the shadow communications minister, joined Hume in calling the policy “unfair” on taxpayers.

“What this will simply do is increase the burden on all taxpayers,” he told ABC Radio.

“This has to be paid for. There’s no such thing as a free lunch.”