Universities Accord (Cutting Student Debt by 20 Per Cent) Bill 2025
Tuesday 29th July 2025
The Universities Accord (Cutting Student Debt by 20 Per Cent) Bill 2025 delivers on the Albanese Labor government's commitment to make student loan programs fairer and more affordable, making tertiary education more accessible. Importantly, it will help to address intergenerational inequity, an issue that I am concerned about. One factor contributing to this inequity in Australia is student debt. Many Australians benefited from the fact that tertiary education was free from 1974 until 1989. However, tertiary education fees have increased significantly since they were reintroduced 36 years ago, particularly in recent years. In fact, average student debt in Australia has doubled since 2010, from about $13,000 to $27,000 today. We need to ease this burden on students, because all Australians benefit from a well-educated workforce—not just through teachers, nurses and doctors but because it makes our economy more productive and competitive. Unfortunately, high levels of student debt are discouraging some young people from pursuing tertiary education, particularly those from lower socioeconomic backgrounds. Jobs and Skills Australia, a statutory body that provides reports on our country's labour market and workforce skills and training needs, believes that more than 90 per cent of new jobs in the next decade will require post-high-school qualifications.
In November 2022, the Albanese Labor government commissioned the Australian Universities Accord to conduct a review to drive lasting reform in Australia's higher education system. The objective of the accord was to devise recommendations and performance targets to improve the quality, accessibility, affordability and sustainability of higher education in order to achieve long-term security and prosperity for the sector and the nation. The accord's final report was released in February 2024, and it began by highlighting the importance of higher education, stressing that it is vital to Australia's future. The report stated:
…the knowledge, skills and research it produces enable us to be an economically prosperous, socially equitable and environmentally sustainable nation. By encouraging intellectual endeavour, creativity and personal accomplishment, it adds to the quality of our lives. Pursuing truth through free discussion, it promotes democracy and civic values. Those communities fortunate enough to host a university benefit directly from the employment, higher incomes, sporting facilities, cultural and intellectual richness and other benefits they bring.
The accord's final report stressed the importance of equity. It found:
Every Australian should have the opportunity to experience the life transforming benefits of tertiary education. This is vital for Australia's future. Only by expanding access to tertiary education to currently under-represented groups—including people from low SES—
socioeconomic status—
backgrounds, First Nations, people with disability and regional, rural and remote students—can the nation meet its projected skills needs.
The accord's final report stated:
Equity … provides an answer to meeting Australia's skills needs. Increasing the number of people undertaking tertiary education through a more inclusive approach will have positive benefits. Australia needs not only to increase the number of skilled workers but also ensure that they have access to lifelong learning. This will require much higher participation among groups historically under-represented in higher education, and students from these groups will need adequate support to succeed throughout their learning journeys.
The Albanese Labor government is committed to maximising Australia's prospects of national economic success. We want to ensure that current and future generations can enjoy the career opportunities and higher incomes that tertiary education makes possible. The accord found that increasing participation in higher education can only be achieved by making the higher education system far more equitable. The current underrepresentation of people from disadvantaged groups must end. This means addressing some of the financial pressures to ensure that all Australians can make tertiary education a reality should they wish to pursue this path. One recommendation in the accord's final report is that the HELP, the Higher Education Loan Program, system needs to be reformed to make it fairer. The accord reported:
HELP has served Australia well by expanding university access to many more students. Its core components—no upfront tuition fees and income contingent repayment—are fundamental to its fairness and effectiveness. HELP is an indispensable part of the higher education funding system, but it requires reform … Australians should not be deterred from higher education because of the increased burden of student loans.
The Albanese Labor government is committed to reducing student debt. This current bill will cut 20 per cent of all student loan debts, a benefit of around $16 billion to around three million Australians. This includes over 15,000 people in my electorate of Whitlam who will see their debt reduced by an average of $5,000. For those students with a debt of $50,000, this bill would cut their debt by $10,000. When last year's changes to indexation are taken into consideration, Labor's initiatives will help reduce total HELP and other student loan debt by nearly $20 billion. This is real financial relief for students and young people, which is an issue dear to my heart. Furthermore, the minimum threshold for repayments will be lifted from just over $54,000 to $67,000, and it will grow in line with wages growth.
The bill also replaces the current repayment system with a new marginal repayment system. Under the current system, once someone earns above the minimum repayment threshold of $54,435, they pay a percentage of their entire wage as repayment. Under the new marginal repayment system, only a percentage of a person's wage above the minimum repayment threshold is paid. Someone currently earning $70,000 pays $1,750 each year, but under the changes introduced in this bill, they will only pay about $450.
The Albanese Labor government is also supporting students through the Commonwealth prac payment, which benefits about 68,000 eligible teaching, nursing, midwifery and social work students while they're completing their compulsory practical training at university. Labor has also locked free TAFE into law, resulting in more than 650,000 enrolments across the country, with 170,000 of those courses already completed, and has substantially expanded FEE-FREE Uni Ready Courses, which helps more students from disadvantaged backgrounds get a chance to access university. This initiative is often life changing for these students.
The Albanese Labor government is building a stronger and fairer education system for Australians from early education to higher education. The government's reforms include cutting the cost of early education and care for around one million families and building a universal early childhood education system and delivering full and fair funding for public schools attended by around 2.6 million students. The Universities Accord (Cutting Student Debt by 20 Per Cent) Bill 2025 contributes to this reform agenda by providing significant relief to Australian students and workers with a student loan debt, and I commend this bill to the House.
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