Explanatory Memorandum(Circulated by authority of the Minister for Education, Science and Training, the Honourable Julie Bishop MP)
Schedule 5-Repeal of the Higher Education (HECS) Account
Higher Education Funding Act 1988
Item 1 Subsection 34(1) (definition of Account)
The Higher Education (HECS) Reserve (the 'Account') is a Special Account for the purposes of the Financial Management and Accountability Act 1997 . The purpose of the Account was to make payments under section 61 of the Higher Education Funding Act 1988 (HEFA), with the amounts with which the Account was to be credited specified in section 60 of HEFA.
Following the implementation of the higher education reforms and the commencement of the Higher Education Support Act 2003 (HESA) on 1 January 2005, payments under section 61 of HEFA were no longer made out of the Account.
However, until 1 June 2006, amounts were still being credited to the Account. These were amounts payable in respect of accumulated HEC debts. Under Part 3 of the Higher Education Support (Transitional Provisions and Consequential Amendments) Act 2003 , accumulated HECS debts became accumulated HELP debts from 1 June 2006 and repayments in respect of these debts have been collected under HESA since then.
As money is no longer being credited to or withdrawn from the Account, the Government proposes to repeal the Account with any amounts in the Account on 31 May 2006 going into consolidated revenue.
Items 1 and 2 repeal the definition of Account in subsection 34(1) and repeal Part 4.3 which establishes the Account.