EDUCATION EQUALITY: HECS could be key for rural students: expert

Australian National University (ANU) economics Professor Bruce Chapman designed HECS in the late 1980s, and has suggested offering country students a $5000-a-year voluntary loan, capped at $10,000 per student, to bridge the gap.

"We could actually provide students with HECS type loans to cover living away from home expenses," Professor Chapman said.

"The reason it makes sense is that some people won't be able to get the money from a bank, they won't be able to get it from their parents but you still need it, and country people especially need it to access university."

While the concept is intended to for transport, accommodation, food and textbook expenses, Professor Chapman suggested students should not be restricted in how they spend the extra money.

A surcharge of up 20 per cent should be imposed to reduce the burden of the loan on taxpayers, he said.

The living-away-from-home loan and surcharge would both be income-contingent, and neither would have to be repaid until the rest of the HECS debt was paid off. Professor Chapman said it would help make university more accessible and equitable for country students.

"The choice is that or nothing at the moment, and you're not going to get governments in the current economic or political environment, you won't get them to give grants away," he said.

"There's been a lot of modelling done on increasing HECS and the basic result is that it doesn't discourage people from attending university. It will actually encourage them. It's basically because it's a very gentle line - you only pay it back when you can afford it, once you're earning over $54,000."

"We haven't done all of the work on this [yet], it's just a concept, but it would not be expensive. Cap it at about $10,000 per student, it's enough to get people over the line."