Albanese targets young voters in wiping out 20 per cent of student loan debt in 2025

Younger Australians are in the Prime Minister’s sights as he pulls the trigger on election campaigning in Adelaide.

Peter Malinauskas and Prime Minister Anthony Albanese at a Flinders University event earlier this year. Picture: NewsWire / Roy VanDerVegt

Prime Minister Anthony Albanese is announcing on Sunday a massive 20 per cent will be wiped off crippling student debts, in a brazen bid to win back younger voters.

The announcement being made in Adelaide will see around $16bn in debt cut from existing student loans nationally on June 1, with the government introducing legislation next year.

It means university graduates with an average HELP debt of $27,600 will see $5,520 slashed from their remaining loans.

Mr Albanese’s latest announcement comes a day after he told Australians they would only have to start paying back student loans once they earn $67,000 or more compared to the current threshold of $54,435.

As the starter gun is pulled on the federal election campaign, Mr Albanese will outline further details at a campaign rally today in Adelaide with Premier Peter Malinauskas.

The latest plan brings welcome relief to all Australians with student debt from HELP, Vet Student loans, Australian apprenticeship support loans and other income-contingent student loans.

Mr Albanese’s announcement targets young South Australians who have finished TAFE or university who are struggling to save for a home deposit and pay bills at the same time as repaying their study loans.

Prime Minister Anthony Albanese at the opening of a new building at Flinders University with Premier Peter Malinauskas and Vice Chancellor Stirling earlier this year. Picture: NewsWire / Roy VanDerVegt

Australian Taxation Office data revealed earlier this year that the number of people with higher education debt over $100,000 has soared, young people having to choose between an education or a home loan.

At present, when former students start earning between $54,435 and $62,850, a compulsory one per cent of their salary is diverted to repaying their HELP debt.

Once their pay increases to between $62,851 and $66,620, two per cent of their entire salary is taken to repay the debt, and this rises incrementally, hitting five per cent on salaries from $89,155 to $94,503 and 10 per cent for those earning more than $159,664.

“My government will make sure our education system is fairer and affordable for every Australian,” Mr Albanese said about today’s announcement around slashing debt.

“We’re already fixing indexation and today, we are going further by taking 20 per cent off student debt – for everyone with student debt.

“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.”

While HECS-HELP debt does not accrue interest, it is indexed for inflation every year on June 1.

In a speech at today’s campaign rally being spruiked as Building Australia’s Future the Prime Minister is expected to begin laying out the core elements of Labor’s policy agenda for a possible second term.

At its core, is a message focused on recognising “young Australians need help to manage cost of living pressures and get established financially once they graduate from study”.