Clive Palmer, head of Palmer United Party, has softened his previous opposition to a student loan hike, which is under a budget plan to charge interests of up to 6% on loans for university fees in Australia.
Sydney, NSW, Australia., June 2, 2014 - (PressReleasePoint) - Analysing the Australian Tax Office data, Fairfax Media hypothesised that a huge number of university students in the country will be facing high costs under a budget plan to charge interests of up to 6% on loans for university fees. And, the probability of students paying thousands of dollars extra has increased, with Clive Palmer, leader of Palmer United Party (PUP), softening his previous opposition to the plan.
Palmer, who will hold the balance of power in the Senate starting in July, said “We've got to see how we can have a win-win situation for Australia and for Australian students.” He added, “I do think our universities could be a great export for Australia.”
The present government has planned to let universities set their own fees, bring down students' income threshold for them to repay debt and, for the first time, apply real interests to educational loans. These changes split the university sector, with elite schools strongly in favour while technical and regional schools in opposition.
Under the reform, it is speculated that prices of some degrees could increase to $120,000. Interests have not been applied to educational loans since HECS was introduced in 1989, with debts nailed down only to inflation (now 2.9%).
Starting in 2016, debts will also be indexed to the ten-year Treasury bond rate, which is capped at 6%.
The change will also affect those with student debt. According to Tax Office data, there were 1.175 million individuals in Australia having HELP debts in 2012, and a $60,000 debt, which is unpaid for 10 years, would increase to $97,734 at an interest rate of 5%. The Treasury bond rate, which is now 3.8%, can fluctuate dramatically and has an average of 5.2% for the past 10 years.
Before the election, Palmer claimed that soaring tertiary education costs were holding the country back. He said, “We need Australia's cleverest people taking themselves and this great nation forward, not burying them under a mountain of debt.”
However, he now expressed to be open to Minister of Education Christopher Pyne's sweeping reforms. Palmer, who has been resistant to Coalition MPs, including Prime Minister Tony Abbott, stated he would come up with a decision that is based upon national interest.
Palmer acknowledged he has a good relationship with Pyne, whom Prime Minister Abbott appointed to communicate with him.
“I've known Christopher Pyne for a long time,” Palmer said.
“He's a very entertaining member of Parliament.”
With the Labor Party and the Green Independents opposing the reforms, Abbott's government will need the support of Ricky Muir (PUP ally) and two other crossbench senators from PUP to pass their higher education package. With Senators-Elect David Leyonhjelm and Bob Day already supporting Pyne, the success of the measure will be decided by Palmer.
About the Author:
Get Approval offers an easy solution to obtaining finance for personal or business purposes. Their application process for online loans is designed to ensure convenience for borrowers, even those with bad credit history.