Stop 'punishing' students; Tammy Tyrrell calls for HECS debt reform

Senator Tyrrell said she could not imagine banks getting away with charging interest on a mortgage without taking repayments off the outstanding balance.

"Why do we expect students to put up with it?" she said.

"The HECS debt that we have in Australia is $78 billion, and that makes my eyes water.

"There is a lot of money there that we have put onto people to become our doctors, our lawyers, our social workers, and we're trying to get people back into those trades but [why would you] when you're going to be punished for educating yourself to a very high standard?"

Senator Tyrrell said she supports reforming the indexation process: "There should be a way to make life easier, it doesn't make any sense that people are paying their HECS amount and it's not coming off before indexation."

The indexation on HECS debts is expected to rise between 4.2 and 4.8 per cent from June. Senator Tyrrell said it would make sense for people's repayments to be taken off the balance before indexation is applied.

She added that she was hearing that people's ability to apply for a mortgage was also being affected by their higher education debts.

"That's what people are telling me... and the way that people are struggling at the moment to get into homes, why are we punishing people for wanting to be educated and contribute to society?

"I look at HECS-HELP like a mortgage for education... but with a mortgage you have an offset account and can put your income into it and it makes a huge difference to your mortgage, so why is HECS any different?"