For many, especially those living independently in Sydney and Melbourne, that is going to put their finances under strain. Loading Kate Clayton, 22, is a Masters of International Relations student at the University of Melbourne who will be graduating in December. She's worked throughout her degree and expects to be working full-time next year. She expects to earn above the salary threshold and to have to start repaying her student debt of about $60,000. Kate, who rents, is careful with every dollar of her spending. She hardly ever eats out and is a vegetarian because it is cheaper than eating meat.

While she is not complaining, she says her finances are going to continue to be tight for the foreseeable future. "The lowering of the salary threshold for the repayment of my student debt has made me question whether to pursue a PhD in the future," she says. "I feel the need to seek full-time work, in order to get saving for a house deposit and to help me become more financially secure. I expect to be paying off my student debt for years," Kate says. Desiree Cai, national president of the National Union of Students, says new graduates are being given less time to build their financial security before they have to start repaying their HELP loan. She points out that the lower HELP repayment threshold is not all that far away from the full-time minimum wage.

"There's a lot of stress and worry for graduates on low incomes who might struggle to make ends meet," she says. A report by the Parliamentary Library shows the average amount of outstanding student debt in 2017-18 was $21,557, up from $20,303 in 2016-17 and from just over $10,000 in 2006. The number of people with a HELP debt in 2017-18 was 2.87 million, up from 2.66 million in 2016-17 and 1.37 million in 2008-09. In March 2018, then minister for education and training in the Turnbull government, Simon Birmingham, said cuts to the threshold were necessary to ensure "our world-leading HELP system is sustainable into the future".

He said that, under the old system, about a quarter of the debt was never expected to be repaid and the rate of increase in the debt was "unsustainable". Under the way that HELP repayment is structured, the higher the taxable income, the higher the percentage of that income is deducted by the Australian Tax Office to repay the debt. For those earning between $45,881 and $52,973 during 2019-20, the repayment rate will be 1 per cent of salary. That means those falling in this income bracket will pay roughly $10 a week off their student debt. Between $52,974 and $56,151, the repayment is 2 per cent of income and rising in 0.5 percentage point increments up the taxable income scale. At $134,573, repayments hit more than 10 per cent of income. That is a significant increase for those on higher incomes.

In the current financial year, those earning $107,214 and more repaid 8 per cent of their income. The debt is increased each year by the rate of inflation. Grattan Institute higher education program director Andrew Norton says because of the way the repayments schedule will change on July 1, most people earning between $60,000 and $95,000 will actually be repaying a smaller portion of their income than they do now. "Overall, I think requiring people on lower income to repay has been a reasonable response by government to the problem," he says. Norton says a major reason for the growth in the typical HELP loan size is that more people are completing post-graduate studies.