Australia slashes student debt by 20%, wiping $10B for 3M students

Australia has officially passed legislation on Thursday to reduce all student loan debts by 20 percent, effectively wiping out a combined total of US$10 billion (approximately AU$15 billion) owed by over three million students.

Details of the Legislation

Government’s Rationale

Most Australians rely on government-issued loans to finance their university or tertiary education. However, escalating university tuition fees — with some basic degrees costing upwards of US$25,000 per year — have left many burdened with debts that can take decades to repay.

This sweeping debt relief initiative was a core cost-of-living promise made by Prime Minister Anthony Albanese during the last general election.

Official Statements

“We promised cutting student debt would be the first thing we did back in parliament — and that’s exactly what we’ve done,”
— Prime Minister Anthony Albanese

“Getting an education shouldn’t mean a lifetime of debt,”
— Prime Minister Albanese, reinforcing the government’s student support policy

The move is seen as a major step towards financial relief for students and young professionals, and is expected to stimulate long-term economic mobility and consumer confidence among graduates.