Australia Erases $10 Billion in Student Loans: Over 3 Million to Benefit from 20% Debt Cut

In a landmark move to tackle the rising cost of education, Australia’s Parliament has passed a legislation that slashes all student loan debts by 20%, wiping out approximately US$10 billion owed by more than three million current and former students.

The sweeping reform, a key election promise by Prime Minister Anthony Albanese, comes as higher education fees continue to climb—placing increasing financial pressure on young Australians. University degrees can cost as much as US$25,000 (around A$40,000) per year, leaving many students burdened with debts that can take decades to repay.

“We promised cutting student debt would be the first thing we did back in parliament — and that’s exactly what we’ve done,” said Albanese. “Getting an education shouldn’t mean a lifetime of debt.”

Under the new law, the average student will see about US$3,500 shaved off their loan balance, with the average total debt standing at US$18,000. The measure forms part of the government’s broader cost-of-living relief strategy aimed at easing financial stress for working families and young Australians.