Does a HECS debt reduce your assets for Centrelink purposes?
Can anyone answer this question for me please? If a disability pensioner has $300,000 in asssessable assets but has run up a $50,000 HECS debt that will never be repaid (because they will never earn an income), does Centrelink deduct the debt when assessing their assets for pension purposes?
The person concerned has lodged an assets statement in another matter claiming their assets are only $250,000 because the HECS debt reduces their ''wealth''. I contested that on the grounds that the debt does not have to be repaid and never will be and the reply was that Centrelink accept it is a debt that reduces the persons total assessable assets. I consider that unfair if it's true! It means people who have substantial savings can use studying at public expense as a mechanism to increase their welfare payments.
Rainey, do you know if the Centrelink allowed the HECS debt to reduce assessable assets or is it hearsay? Certainly seems to be a loophole if true. I think it should be disallowed as HECS is paid back once income exceeds a threshhold, not because someone has assets.