The Australian Government’s Universities Accord (Cutting Student Debt by 20 per cent) Bill 2025 has passed Parliament. The legislation makes Higher Education Loan Program (HELP) and student loan repayments fairer, and reduces student loan debt by 20%.
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Around one million Australians will benefit from the changes to make the HELP and student loan repayment system fairer.
What has changed?
The Government has made the HELP and student loan repayment system even fairer by changing the repayment system and increasing the amount people can earn before they are required to start repaying their loan.
The minimum repayment threshold has changed from $56,156 to $67,000 in 2025-26.
This change has also introduced a system where HELP repayments are calculated only on the income above the new $67,000 threshold rather than repayments being based on total annual income.
This new repayment system means that people will only have to make student loan repayments when they can afford to do so. People will also make smaller repayments in the early years of their loan.
Repayment thresholds and estimated compulsory repayment amounts are available at Making student repayments fairer.
The new repayment schedule has taken effect from the 2025-2026 income year.
Why has this changed?
The Government has been working to make the HELP and student loan repayment system better and fairer.
It recognises that there are some things in the way that people pay back their student loans that need fixing, especially at a time when so many Australians are doing it tough.
It particularly responds to calls from the independent review panel – the Australian Universities Accord – that recommended in its Final Report (February 2024) that HELP repayment arrangements should be reformed.
Recommendation 16b stated “reducing the financial burden of repayment on lower-income earners and limiting disincentives to work additional hours by moving to a system of HELP repayment based on marginal rates”.
By making these adjustments to repayment rates and thresholds, the Government will be ensuring that more people have more money in their take home pay now by ‘smoothing out’ the time and pace in which they repay their debt.
Importantly, people on lower incomes will benefit the most from these changes.
Who benefits and how?
Anyone with one of the following student loans will benefit from these measures:
- any of the HELP loans, including HECS-HELP, FEE-HELP, STARTUP-HELP, SA-HELP, OS-HELP
- VET Student Loans
- Australian Apprenticeship Support Loans
- Student Start-up Loan
- Student Financial Supplement Scheme
Use the estimator to see how much your compulsory repayment for 2025-2026 could be reduced by.
These changes to make HELP and student loan repayments fairer are in addition to the 20% HELP debt reduction.
Details are available at the 20% reduction of student loan debt page.