He said the high cost of degrees for arts, business and law students would probably keep the number of people with debts above $50,000 high.
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“Then if they do postgraduate degrees their debt will be even higher … making them vulnerable for very high debts for the rest of their lives,” Norton said.
Education Minister Jason Clare said a proposed new body – Australian Tertiary Education Commission – would steer further reform around HECS, including setting the cost of degrees.
“The ATEC is the appropriate body to do this work,” he said.
But Norton said – based on the time needed to set up the proposed ATEC – it appeared unlikely the government would unwind Job-ready fee hikes for degrees like arts before 2027.
HELP debt includes all forms of student loans including HECS – which is for the student contribution of government funded university places – and those for full-fee postgraduate degrees.
The average HELP debt rose to $27,640 last financial year, up on $26,494 the year prior and $21,557 five years ago.
The Australian Taxation Office data revealed there were more than $55 million in voluntary repayments last financial year on top of the record $71 million the year before.
It shows the average length of time to fully repay student debt has reached 9.9 years, up on 9.2 years five years ago.
Western Sydney University vice-chancellor George Williams urged the government to take immediate action to reverse the escalating costs of arts degrees, which will cost more than $50,000 for students starting next year.
“How does this imbalance, impacting equity groups, serve the minister’s commitment to make the system ‘fairer’?” he said.
“The debt incurred for gateway and foundation-style degrees works against the government’s stated aim of encouraging more equity and diverse students into university to reach its target of 80 per cent of the working age population with tertiary qualifications by 2050.”
In a submission to a Senate inquiry, Sydney University said the government’s changes to indexation would modestly improve affordability but noted Labor was yet to commit to addressing the underlying cause of growing debt burden.
“Until the government addresses the inequities of the [the Morrison government job-ready reforms], Commonwealth-supported students enrolling in many popular courses face HELP debts of between
$50,000 and $90,000 for their first degrees alone,” it read.
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Economics professor Bruce Chapman, a founder of the HECS system, said the high fees for primarily humanities degrees was the single most important issue facing the sector.
“Female humanities students have the lowest lifetime earnings of all graduates and they’re the ones with the highest debts,” he said.
“It’s very inequitable”.
Chapman, along with Australian National University colleagues Tim Higgins and Gaurav Khemka, is developing different degree pricing structures they say would address this inequality.
The long-awaited government-commissioned University Accord review this year recommended scrapping the Job-ready Graduates scheme, finding it left students with high debts which were not reflected in their future salary potential.
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Student debt numbers blow out above $100,000
