Australia Slashes Student Loan Indexation by 20% in Major Relief for Graduates

The Australian government has announced a 20% cut in student loan indexation, offering major relief to more than 3 million current and former students. The change applies retroactively to the 2023 and 2024 indexation years, meaning those with HELP (Higher Education Loan Program) and other student loans will see automatic reductions in their loan balances.

The move comes after widespread concern over the sharp rise in loan balances due to inflation, with the 2023 indexation rate hitting a record 7.1%. Under the new system, indexation will now be based on the lower of the Consumer Price Index (CPI) or the Wage Price Index (WPI), helping prevent future spikes in student debt.

For many borrowers, this means savings of hundreds to thousands of dollars. No action is required by borrowers, as adjustments will be made automatically.

The reform follows recommendations from the Universities Accord panel and is part of broader efforts to make higher education more affordable and equitable in Australia.

Share to: