What is HECS-HELP in Australia?
HECS-HELP is an Australian government loan scheme that helps eligible students pay for university study. Students do not pay upfront and instead repay the loan through the tax system once their income reaches a set level.
The scheme was introduced in 1989 as the Higher Education Contribution Scheme, known as HECS. It replaced free university education, which had existed from 1974 to 1988.
Students in Commonwealth supported places pay a share of their course costs, called the student contribution. They can choose to defer this cost using a HECS-HELP loan.
Repaying the loan
Repayments begin once a person's income passes a minimum threshold. The amount repaid each year increases with income and is collected through the tax system.
The loan does not charge interest in the usual sense, but it is indexed each year to keep pace with inflation. Changes in recent years have aimed to limit indexation and reduce debts.
Other HELP loans, such as FEE-HELP and VET Student Loans, help students pay for other types of courses. Many Australians graduate with a HECS debt, which is commonly discussed when people talk about the cost of living.