Debt reach extending overseas
The Federal Government is pushing to able to collect student debt from Australians living overseas.
There is a conspicuous gap in the student loan scheme that lets Australians rack up government-backed bills and then leave the country without having to pay them.
Education Minister Christopher Pyne has introduced new legislationthat he says will require Australians living overseas to make the same repayments on their student debts as they would living in Australia.
“As it currently stands, Australians living overseas are not expected to make debt repayments, no matter how high their incomes," he said.
“These Bills will ensure equity and fairness for all Australians with Higher Education Loan Programme (HELP) or Trade Support Loan (TSL) debts, and will help to maintain the stability and security of Australia’s education and training system.
“The same provisions for repayment of debts that apply to those living overseas will apply to those living in Australia. If you are volunteering overseas and earning only a small amount, if you are pulling beers or cutting hair in London for three months you will not be within the scope of these obligations.
“However if you’re working in a well-paid job overseas you will be required to pay back the cost of the education that you got here in Australia.
“From 1 January 2016, all Australians with current and new HELP and TSL debt who move overseas for six months or more will be required to notify the ATO via the myGov website to facilitate repayments.
“And from 1 July 2017, Australians with HELP and TSL debts who are non-residents for tax purposes will be required to assess their total Australian and foreign-sourced income in order to make income-contingent repayments, starting with the 2016‑17 financial year.
“Only graduates earning over the repayment income threshold [currently around $54,000 Australian dollars a year] will be expected to make repayments.”
Mr Pyne said the measures are estimated to save more than $25 million between 2015-16 and 2018-19, and more than $150 million over 10 years, in fiscal balance terms.
The Australian Taxation Office will provide an online tool to enable debtors to easily assess their repayment income and make repayments.
Mr Pyne also said that, following discussions with the United Kingdom, the Government plans to undertake a pilot data sharing project with the UK to enhance debt recovery. Reciprocal arrangements are also under discussion with New Zealand.
“This initiative will level the playing field and treat people the same no matter what currency their pay comes in,” Mr Pyne said.