Warning: This information may not apply to the current year. Check the content carefully to ensure it is applicable to your circumstances.
Indexation
Indexation is applied annually on 1 June to the part of your debt that has remained unpaid for 11 months or more, to maintain its real value by adjusting it in line with changes in the cost of living. The change in the cost of living is measured by the Consumer Price Index (CPI). The indexation rate applied to debts on 1 June 2008 was 2.8%.
When indexation is applied to your account the new balance must be a whole dollar amount, so we disregard any cents in the total. This new balance becomes your new accumulated HELP debt.
You will find a list of indexation rates applied to debts each year since 1990 on our website.
Example: Indexation
Amelia has an account balance of $11,300, including her 2007 second half year debt of $1,650. On 1 June 2008, we apply indexation of 2.8% to the portion of Amelia’s debt that has remained unpaid for 11 months or more. We use the following steps to calculate the indexation amount and Amelia’s new balance after indexation.
Step 1: As Amelia’s 2007 second half year debt has been unpaid for less than 11 months, this amount is subtracted before indexation is applied.
$11,300 - $1,650 = $9,650
Step 2: Indexation rate of 2.8% is applied to the amount from Step 1.
$9,650 x 2.8% = $270.20
Step 3: The indexation amount at Step 2 is added to Amelia’s original account balance.
$11,300 + $270.20= $11,570.20
Therefore, Amelia’s new accumulated HELP debt is $11,570 (we ignore cents).
Sections within Section 2 – Keeping track of your debt
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