Australia plans to wipe out about A$3 billion ($2 billion) from student loans, cutting the debt of more than three million people, as the country continues to grapple with inflation and cost-of-living pressures.

The Albanese government announced the measure in its monthly budget on Sunday in hopes that it would ease economic pressure on workers and students, said Minister for Education Jason Clare in a statement. 

Australia allows university students to take out an interest-free loan to…