The federal government’s rationale for introducing a controversial crackdown on university students who fail subjects has been derided as “baseless”, with data showing only a tiny percentage of students are racking up the huge debts criticised by the federal Education Minister.

Last month, Dan Tehan announced plans for strict new rules on the Higher Education Loan Payment (HELP) system.

Under the rules, students who fail half the classes in their first year of study will be stripped of access to the government loan scheme.

Part of the reasoning behind the ‘Job-ready Graduates’ legislation was because students were racking up large debts without qualifying for a degree, Mr Tehan said.

“These measures will ensure students can’t take on a study load they won’t complete, leaving them without a qualification but a large debt,” he said at the time.

“We have found cases where students with the highest levels of debt have been continuously enrolled at multiple providers at the same time, resulting in debts ranging from $220,000 up to $660,000 combined with very low pass rates.”

Greens senator Mehreen Faruqi called it “baseless fear-mongering”. Photo: AAP

But under questioning from Greens senator Mehreen Faruqi, education department officials admitted there is a tiny number of students on their books who had racked up such large HELP debts.

Senator Faruqi asked the Department of Education, Skills and Employment for data on how many students had such debts during a Senate committee hearing in August.

In an answer to questions on notice, the department said that – as of June 30 this year – just 50 students nationwide had HELP debts over the $220,000 mark mentioned by Mr Tehan.

Only 26 Australians had debts over $230,000. There was just one person in the whole country with a HELP debt above the $660,000 flagged by the minister.

“The idea that there’s this huge problem of students failing their courses and amassing enormous debts is just baseless fear-mongering,” Senator Faruqi told The New Daily.

Struggling students will be harmed by these proposed punitive measures, which the government have not been able to justify.”

It was also pointed out that the government had already legislated a cap on HELP loans – in 2018, with its Student Loan Sustainability Act, which limited loans at $106,319 for most students.

Loans for students studying medicine, dentistry and veterinary science courses, or eligible aviation courses is higher at $152,700.

In submissions to the Senate standing committee on education, the Group of Eight – representing some of Australia’s most prestigious universities – said the proposed HELP changes would “have unintended and perverse outcomes for students” and were “introduced without widespread consultation with the sector.”

Just 50 students had loans of the amount criticised by Mr Tehan. Photo: AAP

“There is no evidence provided within the legislation documentation that there are significant issues to be addressed in this space and that the legislative measures are proportionate to the risk,” their submission said, calling for the measure to be stripped out of the legislation.

“One major consequence of this measure is the possibility that a student who has a poor first year may be locked out of their course when there are university mechanisms to support students and deliver successful outcomes if given time.”

The National Union of Students wrote in its submission that the proposal would “lead to increased pressure for students, or potentially them turning away from higher education altogether”.

Senator Faruqi called the proposed changes “a nasty fix to a non-issue.”

“Struggling students need support, not punishment. Staff, students and universities have all panned these new rules,” she said.

“The malice is just extraordinary. The Liberals have stood by while thousands of uni jobs have been lost. Now they want to kick students off Commonwealth support, hike up fees and slash uni funding.”