AUSTRALIA - The creation of a bonds fund, supported by deferred payments from the Higher Education Contribution Scheme (HECS), would provide a secure long term asset for superannuation funds, according to Universities Australia.
Under HECS, students have to pay part of the cost of their higher education, with the government paying the rest. They can choose to pay upfront, or defer their fees until they are working.
Withers said: "A $6bn fund could be established by the Rudd Labor government, with an estimated $300m becoming available annually from the fund to support enhanced university infrastructure and facilities.
"This would be win-win - for government, universities and the nation."
The proposed HECS Fund would derive income from secure debt, providing a predictable and reliable revenue source for campus improvements and university infrastructure.
Withers said: "The HECS Fund could provide low risk bonds with guaranteed income, protected from domestic and international stock market fluctuations, which will appeal to superannuation funds and investors looking for long term low risk investments."
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