Australian Prime Minister Anthony Albanese announced recently a significant plan to cut student loans by 20% for approximately three million Australians, effectively reducing debts by around AU$16 billion ($10 billion). The initiative will take effect on June 1, 2025, and aims to address rising cost-of-living pressures.
This policy builds on measures from May’s budget, which focused on easing financial strains for citizens through student debt relief, more affordable medicines, and an enhanced rent assistance program. "This will help everyone with a student debt right now, whilst we work hard to deliver a better deal for every student in the years ahead," Albanese said in his statement.
Under the new plan, the average graduate with a loan of AU$27,600 would see AU$5,520 wiped from their debt. The government also plans to reduce the annual repayment amount for those with student loans and raise the income threshold at which repayments start.
Looking to the future, if re-elected in 2025, Albanese’s Labor government pledges to legislate 100,000 free places annually at Technical and Further Education (TAFE) institutes. “This is a time for building, building better education for all,” he emphasized during a speech in Adelaide, South Australia.
The proposal comes at a time when high inflation is exacerbating cost-of-living challenges. With a federal election approaching and Labor trailing behind conservative opponents in polls, the move underscores the government's focus on education and financial relief to resonate with voters.