Australians with student loans are set to receive major financial relief.  

The Albanese Government has passed legislation to erase $3 billion in student debt, benefitting three million Australians. 

Minister for Education Jason Clare has announced that the reforms address rising loan indexation rates by capping them at the lower of the Consumer Price Index (CPI) or the Wage Price Index (WPI).  

The Universities Accord (Student Support and Other Measures) Bill 2024 applies retrospectively from 1 June 2023. It covers HELP loans, VET Student Loans, and Australian Apprenticeship Support Loans.  

Indexation rates for 2023 will drop from 7.1 per cent to 3.2 per cent, while 2024 rates will decrease from 4.7 per cent to 4.0 per cent. 

Adjustments will be applied automatically by the Australian Taxation Office (ATO), either as a credit on existing loans or a refund for fully repaid debts.  

For individuals with an average HELP debt of $27,000, the change means a reduction of approximately $1,200. 

“Now that legislation has passed, the ATO will automatically apply these credits as soon as possible,” Clare said.

The Bill is the first stage of reforms under the Australian Universities Accord. 

Starting July 2025, Commonwealth practical placement payments will support about 68,000 students in teaching, nursing, midwifery, and social work. Fee-Free University Ready Courses will also be expanded to improve access to higher education.  

Labor has pledged further changes if re-elected, including a 20 per cent reduction in all student loan balances and higher repayment thresholds. 

With higher education shaping as a major election issue, the government has urged Australians to estimate their individual benefits using the online HELP Indexation Credit Estimator.

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