HECS | Jotup

Many Australians face losing their homes right now. Here’s how the government should help

Retrieved on:

火曜日, 4月 23, 2024

That same principle underpins the HomeKeeper program I proposed in The Conversation last year.

Key Points:

That same principle underpins the HomeKeeper program I proposed in The Conversation last year.
The idea is to help mortgage-stressed owner-occupiers avoid losing their home.
If it’s a good idea for companies, why not for responsible and otherwise financially-viable Australians at risk of losing their homes in a cost-of-living crisis?
Rather, it’s government help through a small equity stake with positive returns for taxpayers when HomeKeeper help is no longer needed.

People need help now

HomeKeeper would be of most help to lower income families who often don’t have a “Bank of Mum and Dad” to help them “over the hump”, as Albanese puts it, during temporary difficulties.
ACT Independent Senator David Pocock backed HomeKeeper last week in his additional comments in the Senate Economics Legislation Committee report on the government’s Help To Buy Bill 2023.
Pocock wants the government’s Help To Buy mechanism amended to enable low- and middle-income earners “facing mortgage repossession and possible homelessness to remain in home ownership” via a HomeKeeper-style program.
Establishing HomeKeeper is more important than ever because the monetary policy script isn’t following the arc politicians and policymakers planned.

Relying on interest rate relief to arrive isn’t enough

Yet interest rates in Australia are not falling.
What’s more, even without further rate increases by the Reserve Bank of Australia (RBA) this year, the average mortgage rate is set to rise anyway according to research by the RBA’s Domestic Markets Department’s Benjamin Ung.
Nearly a third (31.4%) of mortgaged owner-occupiers are “at risk” of mortgage stress according to the latest Roy Morgan survey.
The longer it takes, the more damaging to individuals and families, and the more costly it is to governments.
Albanese is right – sometimes there’s a role for government in providing help to get over that hump.

Chris Wallace is a professor in the University of Canberra's School of Politics Economics & Society, Faculty of Business Government & Law. She has received funding from the Australian Research Council.

Only 1.5% of students swapped fields due to the 'Job-ready Graduates' fee changes

Retrieved on:

水曜日, 11月 8, 2023

The idea was to steer students into courses that would lead to “the jobs of the future”.

Key Points:

The idea was to steer students into courses that would lead to “the jobs of the future”.
Fees rose by as much as 117% for some fields and dropped by as much as 59% for others.
Our research
Our study looked at student’s preferences when applying for degrees and final enrolments (what they ended up studying).
Using various statistical models, we analysed whether students increased their preferences for fields that became cheaper and reduced preferences for fields that became more expensive.

Studying can be a costly choice. Universities should address young people’s financial literacy gaps

Retrieved on:

木曜日, 5月 11, 2023

A review team is due to finish a draft report in June and a final report in December 2023.

Key Points:

A review team is due to finish a draft report in June and a final report in December 2023.
Some students have been expressing shock and dismay as their loans are interest-free and they believed they would not grow.
This is why universities should do more to help students better understand their HECS-HELP debt and make financial decisions in general.
On top of other generic skills learned at university, such as communication, collaboration, problem-solving and critical thinking, we need to add financial literacy.

Studying is a financial decision

And students accrue significant amounts while studying – often in the tens of thousands of dollars.
The 2021 ANZ Financial Wellbeing Survey found that 18–24 year olds struggle with financial planning, choosing products, understanding online risks and credit-trap awareness.

What is financial literacy?

It requires you to be competent in many aspects of the financial decision-making process.
It includes the person’s knowledge of financial concepts, their ability to gather and sift through information and compare products, and their confidence in making decisions involving money.
Although the concept is broad, there is a set of five questions about interest rates, the stock market and mortgages that are regularly used to measure an individual’s level of financial literacy.
More alarming than the overall decline and increasing gender gap is the decline in financial literacy for those aged 15 to 24.

Why should unis get involved?

In its early iterations, the National Financial Literacy Strategy (later named the Financial Capability Strategy) focused on driving improvement through formal education in schools.
However, the effort has not shifted the dial on school performance in terms of financial literacy and there are issues with the focus on maths in the school curriculum over building specific financial literacy skills.

The US example

In the United States, 19 states either require or plan to require students to do a personal finance course to graduate from high school.
A 2019 US Treasury Department report recommended universities and colleges “should require mandatory courses to teach students financial concepts and skills”.

Many US universities already have financial literacy courses. The Ohio State University, for example, runs a financial coaching program to assist thousands of students each year in setting financial goals, budgeting and banking, credit, debt repayment, saving and retirement planning.

Read more:
Many students don't know how to manage their money. Here are 6 ways to improve financial literacy education

How can we improve financial literacy?

At the strategic level, they should add “developing financially capable students” to the list of graduate attributes.
They could then mandate all students complete a course on managing personal finances as part of graduation requirements.

HECS for farmers? Nature repair loans could help biodiversity recover – and boost farm productivity

Retrieved on:

火曜日, 5月 9, 2023

That’s one reason why the Australian government is looking to alternatives such as a nature repair market.

Key Points:

That’s one reason why the Australian government is looking to alternatives such as a nature repair market.
This, the government hopes, would boost biodiversity – especially on private land such as farms.
To make this market work, the government might consider creating a new version of Australia’s well-known HECS higher education loans.
This work will boost farm productivity and biodiversity with farmers repaying the loan when their revenues permit.

Why is this needed?

To prevent further extinctions, the government announced it would introduce a new nature repair market.
This market could, if done well, tackle some of the drivers of biodiversity loss and land degradation – particularly on our farmland.
Protecting habitat and waterways, preventing erosion and improving drought resilience would all be eligible.
Read more:
We must look past short-term drought solutions and improve the land itself
But farmers can make this money back.

How would this work with the nature repair scheme?

The federal government has pitched its planned nature repair market as an offset scheme: farmers and landholders do repair work and get biodiversity certificates which can be bought by, say, another farmer wanting to clear land.
All farms experience large swings in annual revenues from forces outside a farmer’s control, such as rain, drought, floods and commodity price shocks.
The best financial tool to help farmers undertake nature repair is the type which smooths their income.
If these loans were added to our nature market, it could get much more traction than a grant scheme.

What about the transparency problem?

To avoid this, projects tied to a FECS loan would have ensure plantings, shelterbelts and dam renovations are effective and meet standards.
We could borrow from decades of monitoring hundreds of sustainable farms in endangered temperate woodlands to create robust standards.

As we wrestle with the best way forward for Australia’s first nature repair market, we should seriously consider rolling out revenue-dependent loans for farmers.
He is a member of Birds Australia that seeks to boost bird conservation outcomes on farms