SYDNEY (Reuters) - Australian Prime Minister Anthony Albanese said on Sunday that his government planned to cut student loans for around three million Australians by 20%, wiping around A$16 billion ($10.49 billion) in debts.

The Albanese government’s pledge to push through sweeping student debt reforms if re-elected is under fire from all sides, with the opposition calling it an inflationary cash splash and the Greens accusing Labor of holding young Australians “ransom”.

Australia’s Labor government has pledged to cut A$16 billion ($10.5 billion) in student loans for university and other higher education to help ease the rising cost of living.

Australia’s center-left Labor government has pledged to cut A$16 billion ($10.5 billion) in student loans for universities and skills colleges ahead an election due by May, aiming to counter voter frustration at rising living costs.

Along with the debt reduction, Labor also intends to increase the HECS repayment threshold from AUD54,000 ($39,500) to AUD67,000 ($49,000). This means graduates would only start repaying their debt when earning above this new threshold.

Butler defends student debt relief Health minister Mark Butler has been asked on ABC television whether it’s “fair” that taxpayers foot the burden for students’ debt relief. He said students were under “real financial pressure”: It’s something we can afford as a country because we know there’s no better investment we can make than in the skills and the education of our young citizens.