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Women will suffer disproportionately from the government's decision to apply real interest to student debts for the first time, new modelling shows.
The cost of a three-year accountancy degree, currently $30,255 with no interest payments other than those needed to keep pace with inflation, will climb in price to around $75,000, according to an analysis by the National Tertiary Education Union.
The total repayments would grow to $120,000 in today's dollars, including $45,000 in interest, for graduates who take time off to have children and then work part time. The degree would take 36 years to pay off - compared with 10 years for a typical graduate today.
This compares with 23 years for an accountancy graduate who stays in the workforce. They would have repayments totalling $99,000, including $24,000 of interest.
"The new arrangements have a built-in bias against graduates with carer responsibilities, which will mainly be women," the report says.
The government plans to peg the interest rate on student debts to the 10-year Treasury bond rate, capped at 6 per cent. The interest will also be applied to current and future students with HECS debts.
The modelling, to be released on Tuesday, assumes an interest rate of 4.5 per cent and presents the findings in inflation-adjusted terms. This means the actual charges and the actual interest bills would be much more than the figures quoted.
Bruce Chapman, the founder of the HECS repayment scheme, said he feared the interest rate changes would discourage low-income students from entering university.
"Past changes to HECS didn't deter students, but now that there will be a real rate of interest on the debt we are in uncharted waters.''
In an interview with Fairfax Media, Education Minister Christopher Pyne nominated the interest rate on HECS as an area where he was open to negotiation.
The government has appointed two working groups - led by LaTrobe University vice-chancellor John Dewar and former top public servant Peter Shergold - as advisers. The report finds university fees would need to increase by an average of 33 per cent to compensate for the average 20 per cent cut in funding.
The cost of a nursing degree would climb from $18,000 to $22,000-$40,000, an education degree from $24,000 to $29,000- $40,000 and a medical degree from $60,000 to $83,000-$180,000.