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Sydney’s affluent inner-city suburbs are home to lovingly restored terrace housing, designer dogs and sought-after restaurants.
They also play host to the nation’s highest student debts.
Higher Education Contribution Scheme, or HECS, data analysis by KPMG obtained by this masthead shows 483,606 taxpayers in Sydney owe a combined $15.2 billion.
The Australian government provides a HECS loan to eligible university students who then repay their debt through the taxation system. HECS does not attract interest but is indexed every June to keep pace with inflation.
The number of Australians graduating with a debt of more than $50,000 had grown by 55 per cent in the past five years, the Herald reported in October, after Scott Morrison’s government introduced the controversial Job-ready Graduates Package that raised the cost of arts and business degrees to $50,000, with double degrees costing $90,000.
This week, an education expert warned that a “significant minority” of arts graduates will be saddled with their student loans until they die.
Four years into the government’s term, Anthony Albanese’s Education Minister Jason Clare has failed to repeal the legislation and says that a new advisory body will only provide advice on the job-ready scheme mid-2027.
More than two million Australians have a HECS debt, with the average balance sitting at $28,000, according to tax office data analysis. Across Sydney, 483,606 taxpayers owe a combined $15.2 billion in student loans.
The data shows that the inner-city suburbs of Chippendale and Darlington have the highest HECS debt in Australia, with 1050 people residing in the 2008 postcode – roughly one in 10 – carrying an average balance of $38,944.
HECS debt is also high in Point Piper, Edgecliff and Darling Point (700 HECS debtors owe an average of $38,776), Newtown and Enmore (3162 owe an average HECS debt of $38,396), Paddington, Moore Park and Centennial Park (1898 people have an average debt of $38,389), Rushcutters Bay, Potts Point, Elizabeth Bay and Woolloomooloo (1934 people have an average HECS debt of $38,229), Double Bay (an average of $38,155 is owed by 491 people) and Ultimo ($38,118 is the average HECS debt for the 506 people owing in that suburb).
“Those higher balances clustered around the CBD, that’s reflecting that is where younger career professionals who are carrying the bigger HECS bills are living. They are tapping into those high-paying jobs in the Sydney CBD,” KPMG urban economist Terry Rawnsley said.
“But there’s the next tier down, the more western suburbs like Homebush, Concord, Wolli Creek, Parramatta popping up as well, reflecting that university education class is heading west.
“The northern beaches and the lower north shore were absent from the top of the list, maybe reflecting that younger people aren’t quite flocking to those areas in large numbers.”
At an average of $31,400 in student loans, Sydney came in above the national average HECS debt of $28,500, as did western Sydney ($30,100), Melbourne ($30,800), the Gold Coast ($31,000) and Canberra ($29,300).
Graduating with significant debt speaks to “a challenge for the younger generation”, Rawnsley said.
“In the distant past, you would have got your higher education for free, then in the late 1980s and 1990s, we started to see HECS emerge. It opened up access to university to a lot of people, but since the Howard years, HECS contributions have been steadily ramped up,” he said.
The 2023-2024 data shows a 3.5 per cent reduction in overall from the previous year, he added.
“The number of people with HECS bills has plateaued over the last few years, it’s probably a combination of the higher fee contributions, a strong labour market and alternatives like Free TAFE.”
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