The university is paid upfront by the federal government so it can still cover all of it's costs. The taxation office then collects the repayments, which are j

The university is paid upfront by the federal government so it can still cover all of it's costs. The taxation office then collects the repayments, which are just taken out of your income. There are risks for the government. For example, lots of Australians work overseas and unless they return to Australia to work, they won't pay back the debt. http://theconversation.edu.au/expat-workers-have-cost-australia-450-million-in-hecs-6144 http://theconversation.edu.au/expat-workers-have-cost-austra... But that's probably not a huge percentage of outstanding debt.