I confess: I did not see this coming. After all, I’d just left a four-year stint in finance to go and join the gig economy. Then my phone rang, and it was Chartered Accountants. Asking me if I would be willing to stay up till all hours of the morning, going over the upcoming budget release, and produce some material for their website.
Word had somehow got around that I’d left ANZ and was a free agent. Hey – I’d worked on the budget for four years in a row at ANZ, knew what to expect of the production process, and knew roughly how much coffee it would involve (a lot).
Chartered Accountants are a terrific bunch. Great sense of humour. This was a fun job.
· HECs tweaks mean repayments will kick in sooner.
· Focus of universities will be on developing employable skills.
· Universities will have their budgets cut.
The Australian Budget night’s come and gone and you’re probably wondering “What does all of this stuff actually mean for me??” Well, here are some things to know about – and to make yourself sound smart in front of others.
1. Job title degrees
Universities are getting a makeover. That’s right! What you’re studying will suddenly be a lot more like what you’ll likely find yourself doing when you graduate. Think: less Bachelor of Arts and more like… Bachelors of Business Management.
What to say to sound smart: At least it’s easier to tell grandma what I’m going to do when I grow up!
2. HECS hits
HECS repayments are about to get hectic! Normally people don’t start repaying their HECS debts until they earn $52,000 or more. Think again. Repaymentgeddon will now start at $42,000 – which, by the way, is just a grand shy of the typical Australian annual income ($43,000).
What to say to sound smart: The earlier repayments kick in, the earlier we pay off the loan…
3. Indexed to the max
Speaking of repayment thresholds – the thresholds that are currently indexed (economist jargon here term; just use the word “linked” so you have more than a snowball’s chance in hell of being understood) to the measure of average weekly earnings (AWE) in Australia? As of 2018, repayments will instead be linked (see what we did there?) to inflation.
What to say to sound smart: It just means our repayments will go up and down like other costs.
Got your attention? Good. But we mean the stuff that keeps you alive when you’ve contracted the man flu: medicine! The Medicare rebate freeze is going away, which means doctors will keep on being supported, there’ll be more money for drug research, and you’ll still be able to go to your doctor and not pay a cent!
What to say to sound smart: We can continue seeing doctors for free, and as a bonus, there’s more money for useful drug research.
5. Cost squeeze
The government will be hitting universities with “efficiency dividends” (a jargon term that in normal English means “budget cuts”) of between 2-3% over the next few years. The government has argued that universities receive adequate funding for most courses and revenues (from students) are growing faster than costs.
What to say to sound smart: If unis are going to keep on providing great services they’ll have to hire better accountants!
Would you like to know more?
For the more in-depth version of the above written by Chartered Accountants who understand and can extrapolate the long-term consequences of this Australian budget, check out their commentary on the CA ANZ website. The changes in the university sector will have near- to medium-term repercussions on repayment speeds, and are likely to lead to changes in the structure and annual expenditure dedicated to administrative services within university faculties and departments.