Labor Pushes Permanent Fee-Free TAFE, Higher Student Debt Repayment Threshold

The Albanese government has introduced a swathe of education policies ahead of the next federal election, including a legislative proposal to make Fee-Free TAFE a permanent fixture in Australia’s vocational education landscape, committing to fund 100,000 fee-free TAFE spots annually beginning in 2027.
The move builds on the government’s existing partnerships with states and territories, which funded 180,000 fee-free TAFE places in 2023 and plans for an additional 300,000 places over the next three years.
Prime Minister Anthony Albanese underscored the government’s commitment to addressing skill shortages and creating stable job opportunities.
“My government is putting TAFE back at the centre of vocational education and training, with our investment in Fee-Free TAFE having already seen over 500,000 Australians participating in priority areas to help fix skills shortages,” he said.
Minister for Skills and Training Andrew Giles praised the program’s impact, describing Fee-Free TAFE as “a life changer” for students.
He noted that it supports Australians in achieving meaningful work and eases the cost of living, helping over half a million people gain essential skills to contribute to their communities.
According to data from the government, the Fee-Free TAFE initiative, launched in January 2023, has exceeded expectations, with 508,000 Australians enrolling in courses in high-demand fields by June 2024.
These enrolments include 131,000 in care sectors (such as disability and aged care), 48,900 in digital and tech, and 35,000 in construction.
Government claims that the initiative is aimed at priority groups, with participation from 170,000 young people, 124,000 job seekers, and 30,000 First Nations Australians.
Set to take effect on July 1, 2025, the government will raise the income threshold for minimum repayments and reduce annual repayment rates.
The minimum repayment threshold will be raised from approximately $54,000 to $67,000, meaning borrowers won’t begin repaying their loans until their income exceeds this amount.
Repayments will also be based on a percentage of income over $67,000, potentially offering substantial annual savings. For instance, someone earning $70,000 will pay around $1,300 less annually.
She argued that Labor’s approach could lead to limited vocational choices by focusing on state-run TAFE institutions exclusively.
“Labor will seek to make its Fee-Free TAFE program permanent without detailing the ongoing cost this may have to the Federal Budget or coming clean about its high dropout rates,” Ley said.
She claimed that only 13 percent of enrolments under the program have led to completed qualifications.
This completion rate, she claimed, reflects inefficient allocation of resources, with up to $1 billion of the budget yet to yield qualified workers.
Ley also criticised the narrow focus on state TAFEs, likening it to funding only public schools and excluding independent institutions.
“Skills funding must be tied to the student to give them choice about what they study and where they study,” she said, calling for a model that supports both public and private training providers.