In his early 20s, Atticus Corr has a debt of about $20,000 for his university studies.
The University of Melbourne student will graduate this year, after completing an arts degree.
He’s one of almost three million people who have what’s known as a HECS-HELP debt, which is money owing for Australian university tuition.
In the US, President Joe Biden recently promised to wipe US$10,000 student debt from those who earn less than US$125,000 a year.
The move, which will cost his government US$24b per year aims to benefit middle-class working families.
With the rising cost of living, many Australian university students are keen to see something similar implemented for HECS-HELP debt.
Atticus Corr could have about $80,000 of student debt to pay once he completes a masters degree.
Mr Corr said that he was only really now starting to feel the reality of the debt he’d signed up to as a teenager.
“Beginning in the job market in that entry-level and having to pay off that amount it is incredibly daunting, especially with the cost of living crisis at the moment,” he said.
“When you’re entering uni you’re 18, you’re just excited to go to uni, you don’t have that thought of how much you’re going to owe eventually.
“Over the time you spend at uni you grow up and start to realise, oh my god I’m actually going to have to pay this off at some point.”
Mr Corr wants to be a teacher, so will also need to study a masters in education, which will add another $60,000 to his total debt.
Student debt in Australia
HECS-HELP is a low-interest loan from the federal government that is used for students to pay for their degrees.
Interest is fixed to inflation, and students start paying when they earn $48,000 a year.
Data from the Australian Taxation Office shows almost three million people have a HECS-HELP debt, totalling more than $68b.
In 2021, the average amount of debt was $23,685 per person.
That amount increased last month by $923 under the new indexation rate, which sits at 3.9 per cent, a 10 year high.
University of Melbourne Students Union president Sophie Nguyen said the increasing cost of living, meant students were doing it tough.
“We recently opened up a food relief program in collaboration with the university and there are lines upon lines, hours of waiting just to get free food and like fresh produce,” she said.
“That speaks volumes about the type of student poverty that exists on campus and across the country at different universities.
“Students are doing it tough and it’s been a trend for a while and I don’t think COVID has made that any better.”
University of Melbourne Students Union president Sophie Nguyen.
According to one of the architects of Australia’s HECS-HELP system, a similar plan to the US, to wipe a portion of student debt is not needed in Australia.
Economist and Australian National University Professor Bruce Chapman said the two loan systems were very different.
“In the US the student loans are such that they have to pay it back no matter what their circumstances are,” he said.
“If they’re unemployed or just graduated, they’re looking for a job or they have part-time work, they’ve got to pay back their loan no matter what and that means when labour markets are a bit chaotic as they have been with the pandemic, there’s a lot of graduates who are unable to pay their debt.”
Professor Chapman said removing student debt in Australia could lead to higher taxes.
He said revenue from student loans equals about four or five billion dollars a year and governments would not want to lose that.
“It would mean higher taxes or most likely a lack of full funding for the programs we currently have,” he said.
Analysis done by the Organisation for Economic Co-operation and Development shows the average yearly university fees are highest in the UK at around US$12,000 per year, followed by the US, Chile, Ireland, Japan and Canada.
Australia comes in next, with an average yearly cost of around US$5000.
On the other end of the scale, fees in France, Belgium and Germany averaged less than US$250 a year.
While Denmark, Finland, Norway, Sweden and Turkey all offer free education to residents.
Lowering the cost of study
In Australia, the federal government is establishing a Universities Accord to drive reform of universities, under which the cost and affordability of university degrees is expected to be considered.
Meanwhile, a just-announced initiative in .
This is part of a push to recruit and train nurses and midwives within the state’s health system.
“We will pay their entire HECS debt,” Premier Daniel Andrews said on Sunday.
More than 10,000 nurses and midwives are expected to have their university degrees paid off in full.
Students will receive $9000 over their three years of study and the remaining $7500 would be paid off if they work in the Victorian public health services for two years.