The Greens, continuing their strategy of aggressively targeting disaffected inner-city Labor voters, today announced a radical policy of full student debt forgiveness.
If elected, they will erase all existing HECS debt, at a staggering cost of $81 billion. It is an extension of the promise Labor has already made to reduce student debt by 20 per cent, but unlike Albo’s election promise, the Greens’ policy is essentially to reintroduce free education by stealth.
Free education was a Labor policy, introduced by Gough Whitlam, so extreme and costly to taxpayers that Bob Hawke’s Labor government had to abandon it.
Now Australian taxpayers will be the biggest losers if Labor is forced to reintroduce this policy after next year’s election as the price of a power-sharing deal with the Greens.
While the Greens say their policy is to “put an extra $5,500 in people’s pockets a year” during the cost of living crisis and “make it easier for first-home buyers,” in reality their plan to forgive average student debts of $27,600 effectively reviving the free education model that existed between 1974 and 1989.
“Free” education, of course, was so expensive that it was simply not sustainable and Education Minister John Dawkins introduced the Higher Education Contribution Scheme (HECS).
Since then, graduates, who typically earn more than people who haven’t gone to college, must pay off their student debt once their income reaches a certain level, rather than leaving the bill entirely to taxpayers.
Emeritus Professor Bruce Chapman, an economist who designed HECS, says the Greens’ “very costly” policy punishes those who did not go to university.
The Greens, continuing their strategy of aggressively targeting disaffected inner-city Labor voters, today announced a radical policy of full student debt forgiveness. (Pictured: Monash University students)
“Let’s start with free: there is no such thing as free tertiary education,” he tells me.
‘If it’s free for students, then the taxpayer pays for it.
“Someone has to pay for it; what they mean is free for students and free for graduates.”
Taxpayers are already paying an average of $20,000 a year when a student enrolls in full-time education.
Colleges receive the money upfront from the government, but the tax office has to wait a few years to begin collecting the outstanding debt once the student graduates and earns $54,435 a year.
“If students don’t contribute anything, the entire amount is paid by the public purse,” says Professor Chapman.
‘Who finances the public treasury? And the answer is all taxpayers.’
Professor Chapman, who has been an economist at the Australian National University since 1984, says it is working-class people who end up subsidizing university graduates who earn higher incomes later in life.
“People who left school after Year 12 or before Year 12 or people who did an apprenticeship, they all pay tax,” he says.
Emeritus Professor Bruce Chapman, an economist who designed the Higher Education Contribution Scheme, says the Greens’ policy punishes those who did not go to university.
‘It’s a problem. Most people who are not graduates do not do as well in the job market as graduates; so it is not equitable, because people without a degree are asked to cover the additional costs of graduates who pay nothing.
“That’s probably the most inequitable aspect of public policy education that you can think of.”
Fresh out of college graduates typically earn $71,000, which is already above the median income of $67,600.
But those who study a subject like dentistry can earn up to $94,400 right from the start.
Greens deputy leader Mehreen Faruqi, who holds the party’s higher education portfolio, did not use the term “free education” in her press release on Monday, but the intent was clear in her appeal to the 2.9 million of students with debt.
‘“Student debt cannot be fixed because student debt should not exist,” he said.
“All student debt should be eliminated.”
While the Greens only have four electorates in the House of Representatives, Labor is in danger of losing more inner-city or gentrified seats to the Greens who have a higher proportion of university students.
Education Minister Jason Clare announced this month that the government would spend $16 billion to reduce student debt by 20 percent.
Increases in HECS or Higher Education Loan Scheme fees will, from June 2025, be indexed to the wage price index or the consumer price index, whichever is lower.
Greens deputy leader Mehreen Faruqi, who holds the party’s higher education portfolio, did not use the term “free education” in her press release on Monday, but the intent was clear.
A three per cent swing against Labor – as Newspoll predicted – would see Labor lose seven seats and therefore its majority.
The Greens already hold three lower house seats in Brisbane and one in Melbourne, but Grayndler, Premier Anthony Albanese’s seat in Sydney’s inner west, overlaps with the state Green electorates of Newtown and Balmain.
Senator Faruqi pointed out how the Prime Minister, a late baby boomer, benefited from free education as a student at the University of Sydney during the 1980s.
‘“If Anthony Albanese can go to college for free, everyone else should too,” he said.
The Greens reclaimed former Labor Prime Minister Kevin Rudd’s former inner-Brisbane seat of Griffith in 2022 and are now eyeing the Melbourne electorate of Wills, once held by Hawke, the prime minister who abolished free education .
Samantha Ratnam, a former Victorian MP now running for the Greens in Wills, even featured in Monday’s announcement about scrapping student debt.
“People in Wills know they can’t keep voting for the same two parties and expecting a different result,” he said.
Australian taxpayers will be the biggest losers if Labor is forced to introduce this policy after next year’s election as the price of a power-sharing deal with the Greens. (Pictured: Prime Minister Anthony Albanese)
“Only the Greens will erase your student debt, so you can keep more of your salary.”
The left-wing Albanese faction opposed the abolition of free education during the 1980s, but has since supported deferred payments to students in the Labor group, only for the Greens to revive an old ghost that will haunt them all. taxpayers with or without title.
Australia has not been the only country to scrap free education due to the cost to taxpayers: UK Labor Prime Minister Tony Blair introduced deferred tuition fees in 1998 and New Zealand this year scrapped free education for students. first year
US Vice President Kamala Harris lost the presidential election last week after her boss, Joe Biden, announced that student debts of up to US$20,000 (A$30,300) would be forgiven.
Working-class American voters without a college degree opposed this policy and rallied to Donald Trump. But there is a very real possibility that the Greens’ appeal to indebted graduates will drive them into a shared government with the Labor Party.
And, as history has shown us, someone has to pay for all this free education, and it’s not the graduates who benefit from their degrees. They are the taxpayers.