[voidlogic]

>That would seem to incentivise staying below that threshold for a percentage of borrowers.

That only makes sense if its not implemented like taxes are. For example if when you exceed 50k and your repayment rate for the first 10k of income past 50k is 2%, and you earn 59k, you would take home $58,820. Why would you not want to take home this extra income.

Is of course is assuming it works like taxes in the US (which it probably does). The same kind of bad logic occurs in the US when people won't take a raise because they don't want to "jump tax brackets", but they don't realize you only pay the higher bracket rate on the income that was in that bracket!

[nevdka]

Our taxes work the same way, but HECS repayments don't work the same way as tax. When you hit the threshold, you pay the percentage on your entire income, not just the income over the threshold. There are also multiple thresholds, so when you hit $57,730 you go from paying 2% of your total income to 4% of your total income. Personally, I've turned down overtime due to being just below one of the thresholds.

The repayment scheme is stupid.