SYDNEY – Australian Prime Minister Anthony Albanese said Sunday that his government plans to cut the student loans of nearly three million Australians by 20% and erase about A$16 billion ($10 billion) in debt.

The move builds on the May budget, which tackled cost-of-living pressures in Australia and provided debt relief for students, as well as support for more investment and a rental assistance program to make medicines cheaper.

“This will help everyone with student debt now, while we are also working hard to deliver a better deal for every student in the years to come,” Albanese said in a statement announcing the cut to student loans for higher education. he said.

The changes will mean AU$5,520 will be wiped off the average graduate with a loan of AU$27,600, the government said, adding that the changes will come into force from 1 June 2025.

The government has already said it plans to reduce the amount Australians with student debt have to pay annually and raise the threshold for starting repayments.

Albanese said that if re-elected at the next general election in 2025, Labor would introduce legislation to guarantee 100,000 vacancies each year at the country’s Technical and Further Education institutes.

“This is a time to build, build better education for everyone,” he told supporters in Adelaide, the capital of South Australia state.

Cost-of-living pressures fueled by persistently high inflation have particular resonance with the looming federal election and the centre-left Labor government now polling behind its conservative rivals. REUTERS