Doubtful debt
A significant proportion of HELP and VSL debt is regarded as ‘doubtful debt’, or ‘debt not expected to be repaid’ (DNER). This includes the debt of those who die before repaying their loan. A proportion of the doubtful debt is written off each year. Bankruptcy does not discharge HELP or VSL debt.
According to the then Department of Education, Skills and Employment 2021–22 Annual Report, the amount of HELP debt incurred in 2021–22 not expected to be repaid was 11.8% (p. 57). As VSL loans have only been available for a few years, the extent of DNER is still unknown. However, the Australian Government Actuary has estimated that the DNER for VSL debt is 30% (p. 12).
Written off debt = taxpayers' money down the drain.
Just sayin'.