Just checking, you have a problem with people going to college with their fees being paid by the government under a system where low-income-earners don’t pay anything back, who then do indeed have low incomes working in Christian ministry and have no plans to ever take a higher income job, and so don’t have to pay back the debt?

Well then I’m not sure how that comment applies to the issue of theological students taking advantage of FEE-HELP since I think it is highly unlikely that any of us have NO INTENTION of paying it back the debt.

Dani Treweek

Well then I’m not sure how that comment applies to the issue of theological students taking advantage of FEE-HELP since I think it is highly unlikely that any of us have NO INTENTION of paying it back the debt.

Exactly.....I have no problem with debt just the no intention of paying it back idea.  I guess my comments are because earlier in this thread, the words “no lintention” were used.

Danii Willis said

Just checking, you have a problem with people going to college with their fees being paid by the government under a system where low-income-earners don’t pay anything back, who then do indeed have low incomes working in Christian ministry and have no plans to ever take a higher income job, and so don’t have to pay back the debt?

This is too convoluted for me.....maybe I have had too busy a night - been on the phones for Grief Support.  Good night all.
Gill.

regards
Gill.

I do not have a problem in principle with what is proposed with Fee-Help provided that the dominant purpose of going into or staying in ministry is not to avoid having to repay the fees and the Government is and was aware that the likely outcome for theological training is that the amount will not be repaid.  If my wife’s chief reason to stay at home and care for our children was to avoid paying her HECs debt then I would consider it immoral but if she never repays it because she sees it as a priority to stay at home then that is different. 

At the same time if the Government decides to change the terms of the loan (as they did with HECs in the early days) and decides to include items that are fringe benefits to gross up the income then I do not think those who have taken the loan can complain.  In most cases - but for those fringe benefits they would be repaying these amounts from day one.  These benefits can be taken into account for other purposes such as Income tested pensions and benefits and child support.  If I was borrowing the money I would want to take into account this possibility.

I am a little puzzled that these loans are not repayable on death like other debts and find it difficult to understand the rationale for that. 

I do wonder what lenders make of the debt - it needs to be disclosed on any loan application but do they take into account that you will never have to repay that debt but will have to repay their loan? 

I am concerned that the College will become dependent on the level of funding provided by Fee Help and if the system were scrapped what the consequences might be.  But in the meantime it probably allows more people to be trained.

I am also concerned about what might be a side effect of the new system - that is people in the past had to work for while in full time employment to save enough to go to College.  Has this now changed - are more enrolments from younger people without at least five years work experience.  I think this experience is important and helps clergy understand what most of their congregation members do with their lives and it helps them to develop a theology of work.

should we be indebted to government and taxpayers for a theological education?

is it right that we take these loans knowing it will take forever to reach the payback threshhold?

does our indebtedness to the taxpayer commend the gospel to them?

do we want to perceieved as a burden?

should we allow higher bursary’s for students so that they borrow less?

is it true that most students return to secular work as the article reports?

how can we fund theological education in a way that does not damage our reputation before a watching world?

Hi y’all

I thought I would post my original questions again to see how the discussion has progressed.

Maybe we could focus down on the last few questions.

should we allow higher bursary’s for students so that they borrow less?

Yes! I want to suggest that in view of the above discussion, there is valid reason for not asking students to become so indebted to any loan system. If we really value seeing people theolgically trained, wouldn’t there be value in asking for an across the board parish contribution (as a percentage of income) similar to the current parish contribution that is made for connect 09 or asbestos removal (not that I want to assoc theological students with asbestos!)

(Maybe we could even chanel some of the connect 09 money into more effective training of church leaders to contextualise the gospel and connect with the subcultrues in which they operate! )

is it true that most students return to secular work as the article reports?

the orginal SMH article is questionable but it seems to me that we are quite good at taking people out of the secular into the seminary but less successful at moving people from the seminary back into the secular context (if we do they are often percieved as the failures of the sytem)

how can we fund theological education in a way that does not damage our reputation before a watching world?

have the intention of paying back our loans quickly, or establish interest free private loans for students similar to what other organisations do ( and intend to pay them back )

thanks for the conversation!
Enjoy Grace

have the intention of paying back our loans quickly, or establish interest free private loans for students similar to what other organisations do ( and intend to pay them back )

I have no problem with FEE-HELP (as I’ve said above), but if we get to the position where it is necessary (or desirable) to fund candidates again, this would be a good way to go. Possibly we could build the repayments into clerical remuneration packages (rather than an across the board levy for theological education).

As someone who is looking into the depth of possibility with FEE-HELP, and a firm believer in not relying on Government assistance, I can’t help but wonder how 1. People got a theological degree in the past. 2. People survived on the money they had saved. 3. People are allowed to do History degrees under HECS, but theological degrees are somehow under scrutiny?

No disrespect to Arts degrees, but lets get serious here. Your Master in Arts (philosophy major) is no more worth a dime than a Bachelor of Divinty. In fact, they are probably equivalent in secular societal worth, and educational rigour. I might say that you’d get paid more with the BDiv than the MA, working within the field of study.

Given that framework, I find it hard to justify questioning of the FEE HELP scheme. If education is valuable, then support it. Until Moore starts teaching its students how to wire bombs, I don’t see why our taxes can’t support it. If Moore doesn’t feel comfortable about accepting the money, they should lower fees to make it more accessible and take a cut of the Diocesean budgetting.

For instance the diocese helpfully places conservative self rulings on what a tax exempt ministry expense account can be used for. At present it is capped at 30% stipend with guidlines stipulated even though there is no such tax law that restricts us to 30%.

Shane

Just for the sake of good information, readers should be aware that while the 30% limit is not law, it was arrived at in consultation with the ATO and on their advice that anything much over that might prompt a review of the FBT exempt status.  In other words, our ‘self-restraint’ on this was based, at least in part, on advice from the relevant secular authority as to what practice they held to be consistent with the purpose of the benefit.

So, with regard to FEE-HELP, the views of government bureaucrats (who just might be well-informed as to the history of the system) are not irrelevant in determining the questions before us.  (Not unreasonable questions, by the way.)

Bob

Hi Leigh
My problem was not in using FEE HELP to go through college, my problem was in the no intention of paying it back.  I went to college, and saved up before I went, when I later went and did a degree at Uni, I paid back my HECS fee (although my accountant continually wrings his hands, as I have never made a profit out of my counselling which is is what the degree was for). 

go to College, use Fee Help, and if as a minister your salary never reaches the threshhold where you need to pay it back, so be it.  But (my point is) don’t go to college planning not to pay it back.  That’s all.  For me it is the intention, rather than the outcome I suppose.
kind regards
Gill.

Is it true that most students return to secular work as the article reports?

Shane
I think the SMH article quoted John Woodhouse as saying that many rather than ‘most’ [theological] students return to secular work.

One important consideration when thinking about the ethics of any issue is legality.  And discussion of FEE-HELP on this thread has rightly focussed on this.  And non-repayment of FEE-HELP debts may well be in-line with the legal and regulatory intent of the scheme.

However, there may be wider ethical concerns, beyond mere legality.  We make this distinction in other areas (e.g. bioethics).  Certain medical acts may be entirely in-line with the legal intent of laws and regulations, but still be open to ethical questioning.

Ismo

I think you are missing the ‘ethical’ point here, made so well by Craig.  Allow me an analogy.  If I lend a friend on a low income $1,000 and say to him, “If you get a better paying job and you’re able to pay me back later on that would be great, but if that doesn’t happen the debt will die when you die” (so to speak!), then there is no ethical dilemma - unless he gets a better paying job and doesn’t repay me; or, he deliberately chooses to avoid getting a better paying job so as to avoid repaying me.

Bob

I think you are missing the ‘ethical’ point here, made so well by Craig.  Allow me an analogy.  If I lend a friend on a low income $1,000 and say to him, “If you get a better paying job and you’re able to pay me back later on that would be great, but if that doesn’t happen the debt will die when you die” (so to speak!), then there is no ethical dilemma - unless he gets a better paying job and doesn’t repay me; or, he deliberately chooses to avoid getting a better paying job so as to avoid repaying me.

There’s a difference here though… you would be lending your friend money on the assumption your friend will be able to, and therefore will choose to, get a better job. I’d guess you’d be unlikely to hand out money if you knew your friend wasn’t planning to get a better job if the opportunity presented itself. The government however knows that many people have no intention of getting high paying jobs, but it still is willing to loan money for their education. The government also doesn’t have friendships to risk.

I’d guess you’d be unlikely to hand out money if you knew your friend wasn’t planning to get a better job if the opportunity presented itself.

Perhaps so, but whatever the lender would be likely or unlikely to do, such an intention on the part of the borrower would be immoral - see the last clause of my analogy

The government however knows that many people have no intention of getting high paying jobs, but it still is willing to loan money for their education.

I think that is an assumption that is hard to substantiate, and in fact unlikely.  In fact, if you go back to Glenn Davies post where he reports on a conversation with Dr Brendan Nelson, I think a better assumption would be that the government knows that a significant percentage of borrowers will not get high paying jobs or will not have them for long enough to repay their entire debt.  But I doubt that they know that many people have no intention of doing so.

The government also doesn’t have friendships to risk.

That’s not really relevant to the analogy!

Bob

Gill Evans - 06 April 2008 12:55 AM

go to College, use Fee Help, and if as a minister your salary never reaches the threshhold where you need to pay it back, so be it.  But (my point is) don’t go to college planning not to pay it back.  That’s all.  For me it is the intention, rather than the outcome I suppose.
kind regards
Gill.

But this is a moot point, is it not? If your church doesn’t pay you more than 35K a year once salary sacrificing is done, then what are we talking about intention for?

If you do a theological degree with the intention of being in ministry professionally for the next 40 years, and ministry doesn’t pay enough to pay back FEE HELP, well, your hands are tied aren’t they?

It sounds to me like some people think that it would be immoral to take such a “loan” from the government if their intention is to go into a low-income full time ministry position.

The objection is to the double dipping involved when the charitable exemption to fringe benefit tax has the effect of shielding a person from repaying fee help. An assistant minister on $42,000 can salary sacrifice $14,000 which reduces their income below the fee help repayment threshold. A minister on the minimum stipend of $49,000 can salary sacrifice $16,300 which also reduces their income below the fee help repayment threshold. This means that ministers may never repay their Fee help.

Non cash fringe benefits may amount to more than the thirty per cent allowed for by the diocesan guidelines. For example the ministers housing, and reduced school fees could add another $60,000 of value. So the grossed up income of a minister on the minimum stipend could exceed say $120,000 without fee help being repaid.

Please somebody tell me I am wrong. this is very embarrassing.

The objection is to the double dipping involved when the charitable exemption to fringe benefit tax has the effect of shielding a person from repaying fee help.

John,
I take your point, although others have already made the point that we don’t really know that there is a very significant or widespread objection.  But if there is, either now or in the future, then the most obvious solution to my mind (again, as others have already mentioned) will be to include non-reportable fringe benefits in the calculation of income with regard to when FEE-HELP repayment kicks in.
Bob

I was niggardly before. The grossed up income of a minister could exceed $160,000 without fee help being repaid…

$120k is far too much for a minister anyway.

Dannii Willis - 06 April 2008 06:13 PM

$120k is far too much for a minister anyway.

I hope Dannii was speaking with her tongue firmly planted in her cheek!

The trouble with talk of “grossed up” income is that it includes a number of variables that may have a real value or a notional value.  One of the biggest factors in grossed up clergy remuneration in the Anglican Diocese of Sydney (and many other places and denominations also) is the ‘value’ of accommodation provided to a minister.  What is often overlooked is that that component usually is not a matter of choice (although that is slowly changing) and is not one that can be accumulated.  I’ve lived in such accommodation for the past 12 years but not one cent of its value has been or could be retained by me.  Grossed up income also includes superannuation, sickness benefits, etc., which of course applies to many people in other lines of employment whose relatively low incomes may look quite a bit more generous when grossed up.  Does anyone know any ministers who actually earn, on an ‘apples for apples’ comparison, a $100K+ income?

Don’t get me wrong.  I think we (yes, I’m a Sydney Anglican clergyman) are remunerated very generously, and I am most grateful for it.  I just wouldn’t want people to read comments like John’s (which I’m not disputing) and think that I’m earning a whole lot more than I actually am!

Bob

PS I trained LO-O-O-NG before FEE-HELP was around - in case anyone was wondering.

Regarding Fee-Help. If anyone is concerned about the ethical issues of accepting fee help there is nothing to stop you paying back small amounts whenever you wish. So although you are not legally required to until you reach an income of approx $40k (in 2007-08) you can voluntarily repay a portion of your debt anytime you wish. And if you make a lump sum payment of $500 or more you get a 10% discount off the amount you just paid.

So paying back $500 equates to having paid back $550.

So if Fee-Help concerns you ethically ... you can do what Gill has done and repay it voluntarily. Well done Gill.

Heather.
:)