Dutton Government Would Scrap Labor’s Student Debt Relief and EV Subsidies
More than three million current and former university students set to benefit from a 20% reduction in student debt under Labor’s plan would lose out under a Coalition government, with the Liberals confirming they will abandon the $16 billion initiative.
In a campaign statement, the Liberals said they would drop the policy to rein in spending. The Coalition has previously criticized the plan as “elitist” and unfair to Australians without student loans.
Peter Dutton’s campaign also confirmed it would eliminate a popular electric vehicle subsidy, releasing a joint statement with shadow treasurer Angus Taylor and shadow finance minister Jane Hume. The announcement follows mounting pressure on the Coalition to explain how it would finance its proposed $21 billion increase in defence spending.
“It’s not fair for university students to receive thousands in taxpayer support while young tradies who took out loans for utes and tools, or graduates who have already paid off their debt, get nothing,” the Coalition’s statement read.
“Rather than offering tax relief to small businesses, Labor prefers to spend $16 billion — about $1,500 per household — on a narrow slice of the population.”
Labor’s plan would reduce student debt for over three million Australians, with someone holding an average debt of $27,600 seeing approximately $5,520 wiped under a re-elected Albanese government. Framed as cost-of-living relief, the policy would cancel $16 billion in debt but is officially costed at $737.7 million over four years in the Mid-Year Economic and Fiscal Outlook.
Coalition education spokesperson Sarah Henderson labeled the plan “elitist and unfair,” arguing it disproportionately benefits individuals with multiple degrees, while overlooking the 24 million Australians who don’t have student loans.
Economist Chris Richardson also criticized the policy, calling it a “reverse Robin Hood,” taking from lower-income Australians to give to the better-off.
The Coalition’s stance on electric vehicles also drew scrutiny this week after Peter Dutton initially claimed he had no intention of changing Labor’s EV incentives. However, a media release issued Wednesday confirmed the Coalition would eliminate the fringe benefits tax (FBT) exemption for novated EV leases, calling the program a “badly designed” use of taxpayer money.
The Coalition says repealing the FBT exemption would save more than $3 billion over the forward estimates and up to $23 billion over the medium term.
Mr. Taylor defended the reversal, claiming Dutton had misheard the question during a previous press conference. “Our position has always been clear. Press conferences can be chaotic, and Peter misunderstood the question,” Taylor told the ABC.
This marks the second major policy reversal from Mr. Dutton, who earlier backtracked on comments that all federal public servants should return to office work, later admitting that remote work was important for families.
The Liberal campaign also reiterated previously announced savings measures, including cancelling funding for Victoria’s $200 billion Suburban Rail Loop, ending the $20 billion Rewiring the Nation Fund, and scrapping the $10 billion Housing Australia Future Fund.
“In these uncertain times, a future government must make tough choices to repair the budget and shield Australia from future risks,” the joint campaign statement said.
Electric Vehicle Council CEO Julie Delvecchio expressed frustration over the policy reversal. “If the Coalition is indeed scrapping the FBT exemption just days after Mr. Dutton suggested otherwise, we’re extremely disappointed and confused,” she said.
“The FBT exemption has been instrumental in helping suburban Australians manage the upfront cost of EVs — which are far more affordable to run in the long term.”
