Student debt relief scheme ‘lacks evidence of effectiveness’

A student debt relief programme intended to entice teachers and medical professionals into the Australian outback has attracted only “modest” uptake and should not be expanded to other disciplines until it “matures”, an evaluation has concluded.

A review of the Higher Education Loan Programme (Help) Debt Reduction scheme for “very remote” teachers has found that barely one-quarter of an expected 2,615 participants applied between 2023 and 2025.

And a sister initiative for medical workers had attracted interest from just 0.5 per cent of potentially eligible nurse practitioners and less than 1 per cent of primary care doctors.

Reviewer Rachel Hunter, a former chief Queensland civil servant, said the scheme had “broad support” in health and education and the legal and veterinary sectors. Nevertheless, she recommended that “the programme not extend to other groups at this point”.

“Expansion of the programme to additional professional groups…should be deferred until the current initiatives are more mature and evidence of their effectiveness is available,” Hunter said.

The scheme is the latest incentive programme of its type to draw an underwhelming appraisal from evaluators and policymakers, despite outcry over the rising costs of degrees and the dearth of health and education professionals in the bush.

Launched in 2019, the scheme pauses indexation of teachers’ debts if they work in very remote schools. If they complete the equivalent of four years’ full-time work there over a six-year period, up to five years’ worth of outstanding student debt is also waived.

The programme’s medical stream, introduced in 2022, cancels the debts of general practitioners and master’s degree-qualified nurses if they work at least 24 hours a week in rural areas for periods corresponding to the duration of their studies – or half that duration if they choose areas classified as remote or very remote.

Both streams of the programme emerged after similar initiatives had been scrapped years earlier. The “HECS-Help benefit”, which discounted tuition fees for mathematics, science, teaching, nursing and early childhood education students by about A$1,950 (£1,028) a year, was axed in mid-2017. And a debt reduction scheme for doctors was abolished in 2015, following reports of low take-up.

The review found that debt reduction was a “strong lever and motivator, particularly for early career professionals with most debt load”. But although it helped attract professionals to regional areas, it was less effective at keeping them there.

“The appeal of financial incentives is greatly outweighed by practical needs such as availability of housing, childcare and transport,” the review found. Professional factors such as “supervision, mentorship and development opportunities” and social factors such as “community participation and a sense of belonging” also dictated whether people were prepared to stick out postings in the bush.

Hunter found that the four-year requirement “may be too long” to convince teachers to take advantage of the programme. She also questioned the medical stream’s “live and work” requirement, which obliges participants to both work and reside in regional areas and forbids a “fly-in-fly-out” approach.

“If the programme is actually about getting services where they are needed, why do we care where they live?” the review asks.

john.ross@timeshighereducation.com