Thousands of current and former Australian students will have some of their student debt waived by the Federal Government due to a historical error.
Over 13,000 people from 104 educational institutions, including universities and TAFE, will have a combined $5.4 million wiped from their student debt.
It could save some students thousands of dollars.
HECs debts waiver
Students impacted by the error won’t need to pay the amount incurred through indexation this year. This also applies to any of the previous four years.
Indexation is when the amount owed by students is increased each year to reflect rising prices (inflation).
Student debts rose by 7.1% this year — the largest increase in decades. For example, a $30,000 student debt would’ve risen by $2,130 (7.1%) this year.
What was the error?
Student debt records are held by the Australian Tax Office (ATO).
Students can track their debts on the ATO’s website, meaning they can see their debts in real-time and before they rise with indexation.
This year, the Government learned some students had been unable to view their debt records with the ATO.
Students unable to see their debts were believed to be financially disadvantaged because they weren’t made aware that their debts were set to rise.
This error was because there was missing information on records given to the ATO by education providers. This includes missing tax details, which are provided by students to their education provider.
The ATO only accepts debt records with complete student information.
Does this apply to me?
Education providers will alert students if they’re involved in the matter.
A letter sent by the University of Technology Sydney said affected students will be contacted again once their records appear on the ATO’s website.
The Federal Department of Education said education providers generally provide complete student information. It said providers are working “proactively” to resolve present issues. These efforts are ongoing.