Higher Education Loan Program (HELP) changes - Sustainability Act

The Australian Government is pleased to announce that the Higher Education Support Legislation Amendment (Student Loan Sustainability) Act 2018 (the Act), which was announced as part of the 2017-18 Mid-Year Economic and Fiscal Outlook, passed both houses of Parliament on 14 August 2018.

Passage of the Act has implemented the following changes:

A new set of repayment thresholds

From 1 July 2019, the new minimum HELP repayment threshold will be $45,881 with a one per cent repayment rate, with a further 17 thresholds and repayment rates, up to a top threshold of $134,573 at which ten per cent of income is repayable.

Changes to indexation arrangements

From 1 July 2019, HELP repayment thresholds will be indexed using the Consumer Price Index (CPI) instead of Average Weekly Earnings (AWE). This will ensure repayment requirements are adjusted in line with the cost of living, and streamlines indexation factors currently used.

Amend the order of repayment of some student loan debts

From 1 July 2019, Student Financial Supplement Scheme (SFSS) debts will be repaid after HELP debts are discharged. Currently, SFSS debts are paid concurrently with HELP debts. The repayment thresholds for SFSS will also be brought into line with the HELP repayment thresholds from 2019–20, instead of the current three-tier repayment threshold.

Increase to the FEE-HELP loan limit for 2019

From 1 January 2019, students studying medicine, dentistry and veterinary science courses will benefit from a substantial increase in their loan limit, from an estimated $130,552 in 2019 to a new limit of $150,000, which is a fifteen per cent increase. Students studying all other courses will have a loan limit of $104,440. These amounts will still be indexed annually.

Combined, renewable HELP loan limit

Combined HELP loan limit

From 1 January 2020, there will be a combined HELP loan limit introduced. Only new HECS-HELP borrowing will count towards a person's HELP limit, however existing FEE-HELP entitlement already incurred will be carried over (FEE-HELP, VET FEE-HELP and VET Student Loans). The combined HELP loan limit amount, commencing on 1 January 2020, will be the 2019 FEE-HELP loan limit amount indexed by CPI.

Note: From 1 January 2020, the FEE-HELP loan limit will become the combined HELP loan limit and a person's FEE‑HELP balance will become their HELP balance.

Renewable HELP balance

The renewable component will come into effect at the same time as the combined HELP loan limit, 1 January 2020. Repayments starting from the 2019–20 income year will credit a person's HELP balance. The Australian Taxation Office will advise the Department of an individual's compulsory or voluntary repayment against their HELP debt. The department will use this repayment information to increase a person's HELP balance by the same amount reported.

Any compulsory or voluntary amounts that are repaid will be able to be re-borrowed in the future, up to the current HELP loan limit. This will enable individuals to pursue further study in order to retrain, change careers, or further specialise in their current profession. The same maximum loan limits, depending on the course of study, will continue to apply.

Removal of FEE-HELP loan fee for Table B providers

From 1 January 2019, students studying an undergraduate course of study at a Table B provider will no longer be charged the 25% FEE-HELP loan fee. This only applies to courses of study with a census date on or after 1 January 2019.