Senate

Labor 2013-14 Budget Savings (Measures No. 2) Bill 2015

Revised Explanatory Memorandum

(Circulated by authority of the Treasurer, the Hon Scott Morrison MP)
This memorandum takes account of amendments made by the House of Representatives to the bill as introduced

Schedule 3 - Removal of the up-front payment discount

Summary

Currently students can make a full up-front payment by paying 90 per cent of the student contribution amount for all of their units in a course of study with the same census date and receive a 10 per cent discount for that payment. Students may also pay part of their student contribution up-front and receive a 10 per cent discount for any payments totalling $500 or more for units in a course of study with the same census date. The amount of the discount is paid by the Government to the student's higher education provider.

Schedule 3 implements a savings measure included in the 2013-14 Budget by amending the HESA to create a single set of payment arrangements for HECS-HELP that do not allow for an up-front payment discount.

The removal of the HECS-HELP up-front payment discount would take effect from 1 January 2017.

Detailed explanation

Items 1, 2, 4 and 5 will respectively repeal section 36-50, paragraph 90-1(f), subsection 93-15(3) and sections 96-1, 96-5 and 96-10 and insert a new paragraph 90-1(f) and a new section 96-1. The collective effect of these provisions is to remove the upfront discount of 10 per cent for students enrolled in Commonwealth-supported places who pay their student contributions upfront to a higher education provider.

Item 10 is an application provision which makes clear the circumstances in which the amendments made by Schedule 3 apply. The amendments in respect of an up-front payment only apply in relation to a unit of study that has a census date on or after 1 January 2017.

Item 10 ensures that a person making an upfront payment for his or her student contribution amount for a unit of study with a census date before 1 January 2017 would still be entitled to the 10 per cent discount, regardless of when the payment is made.

However, if a person were to make an upfront payment on or before 31 December 2016 for a unit of study to be undertaken in the following academic year (i.e. the unit's census date would occur on or after 1 January 2017), the person would not be eligible for the upfront payment discount.

Items 3, 6, 7, 8 and 9 make technical amendments for the purposes of Items 1, 2, 4 and 5.


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