Australian Prime Minister Anthony Albanese announced a major student debt reduction plan on Sunday, pledging to cut loans by 20% for around three million Australians, amounting to approximately 16 billion Australian dollars ($10 billion) in debt relief. This move comes as part of the government’s broader strategy to alleviate cost of living pressures, including affordable medicines and enhanced rent assistance, introduced in May’s budget.
“This will help everyone with student debt right now, while we work hard to deliver a better deal for every student in the years ahead,” Albanese said in his statement. The planned reduction will see the average student loan of AU$27,600 reduced by AU$5,520 and is set to take effect from June 1, 2025.
In addition to the debt cut, the government intends to lower annual repayment requirements and increase the income threshold at which graduates must begin repaying their loans. The Labor government also pledged to introduce 100,000 free slots annually at Technical and Further Education (TAFE) institutes, aiming to make education more accessible and affordable if reelected in 2025.
Albanese emphasized, “This is a time for building, building better education for all,” during a speech in Adelaide, South Australia.
The decision comes as high inflation continues to drive cost of living concerns among Australians. With a federal election approaching, the Labor government, currently polling behind its conservative rivals, hopes that the new debt relief measures will resonate with voters who are feeling the strain of economic pressures.
