Student debt for university and other tertiary students expected to blowout.

The Parliamentary Budget Office released analysis on Wednesday that the cost of student debt was expected to soar from $1.7 billion to $11 billion within a decade.

The cost blowout is being blamed on a range of past and future government policies including uncapping university places and opening up loans to vocational education.

The report also takes into account Turnbull government plans to deregulate university course fees, which it says will be the main driver of the growing loan portfolio.

It predicts student fees will soar by 40 per cent as universities recover costs following a planned 20 per cent government funding cut.

In addition, the PBO projects student fees will increase by two per cent every year.

The debt will be driven by those who are unlikely to repay their loans because they earn below the taxable income threshold.

Those “doubtful debts” will double in a decade to $4 billion. Concessional loans will more than double in a decade from $1 billion to $2.4 billion by 2025.

The government says it’s committed to its higher education changes.

Education Minister Simon Birmingham is consulting with stakeholders after deferring the plan until next year for the 20 per cent cut in federal funding to universities and allowing them to deregulate course fees.

The plan has twice been rejected by the Senate and details of the revised package are expected to be unveiled in the May 3 budget.

The Parliamentary analysis comes after a Grattan Institute report released last week found the government could claw back an extra $500 million a year, and even more over time, if it lowered the income threshold that students start repaying their loans.

Mr Birmingham said last week the government was willing to consider a proposal to get students to pay back loans sooner and to collect debts from those who have died.

At the moment students repay their Higher Education Loans Program (HELP) and VET FEE-HELP loans once they start earning $54,186.

If this was reduced to $42,000, this would immediately increase the number of people repaying their debt by 50 per cent.

The report’s author Andrew Norton suggests that the HELP (formerly known as HECS) program has become unsustainable and without change, the ballooning cost would put teaching and research at risk of cuts.

THE RISING COST OF HIGHER EDUCATION

Taxpayers will foot an even bigger bill relating to student loans by 2025.

That’s thanks to a range of policies, including the uncapping of university places, allowing students of training colleges to receive loans, and — if it goes ahead — the government’s plans to deregulate university fees.

COSTS BREAKDOWN

• Student loans: $1.7 billion in 2015-16 to $11.1 billion in 2025-26.

• Debt unlikely to be repaid: $1.9 billion in 2015-16 to $4 billion in 2025-26.

• Cheap loans: $1 billion in 2015-16 to $2.4 billion in 2025-26.

HOW MANY STUDENTS ARE GETTING LOANS?

• It’s grown by 11.2 per cent annually over past five years.

• From 308,000 in 2010 to 522,000 in 2015.

(Source: Parliamentary Budget Office)