Australian Prime Minister Anthony Albanese has said that his government planned to cut student loans for around three million Australians by 20%, wiping off around 16 billion Australian dollars in debts.
A budget from May 2024 broached cost of living pressures in Australia and gave debt relief for students, as well as more investment to make medicines cheaper, and a boost to a 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 a statement announcing the cut to student loans for tertiary education.
The changes would mean the average graduate with a loan of A$27,600 would have A$5,520 wiped, the government said, adding that they would take effect from June 1, 2025.
The government said it already planned to cut the amount that Australians with a student debt have to repay per year and raise the threshold to start repayments.
If reelected at the next general election, due in 2025, Labor would also legislate to guarantee 100,000 free places each year at the country’s Technical and Further Education institutes, Albanese said.
Cost of living pressures, stoked by stubbornly high inflation, have a special resonance with a federal election looming and the center-left Labor government now polling behind their conservative opponent, reports Reuters.
There is a maximum amount that Australian universities are permitted to charge for their full course.
The annual cost is between $AUD 5-10,000.
They do not charge interest, however they are indexed with inflation, ranging from 4% – 10%. The sum is automatically deducted by the government when those in debt are employed.
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