This proposal consists of 3 separate options to change HELP loan settings. 

• Option 1: Apply indexation after compulsory repayments have been deducted from the balance.

• Option 2: Provide debt forgiveness for all indexation amounts accrued on student debt since 1 January 2021, as at the policy start date. 

  • Those who have already paid their debt in full would be refunded the indexation amount directly.

• Option 3: Change the indexation rate to 1%.

All options start from 1 January 2025. 

Additional analysis

The request also sought the following items of additional analysis: 

• Item 1: Impact to forecast indexation under Option 1 (applying indexation after repayments).

• Item 2: Change to the balance of debt since 1 January 2021 when the Job Ready Graduate Scheme commenced. 

• Item 3: Impact on the balance of debt and time taken to repay the debt from changing the current repayment system to one based on marginal repayments, as per below: