US student debt relief plan to cost $400 bn

US President Joe Biden's plan to forgive part of the country's massive student debt burden is estimated to cost $400 billion_ the Congressional Budget Office (CBO) said.

The estimate_ requested by conservative lawmakers and issued by an apolitical federal body_ is expected to add further fuel to the heated controversy between Democrats and Republicans over the issue.

"CBO estimates that the cost of student loans will increase by about an additional $400 billion in present value" as a result of the debt forgiveness_ it said.

But a White House official noted_ "CBO called its own estimate 'highly uncertain.' We agree."

Republicans accuse Joe Biden of wasting money on the measure_ arguing that public funds could be used more effectively. The US President announced the plan on August 24_ making good on a campaign promise.

Under the relief plan_ $10_000 will be cut from all loans owed by people earning a salary of less than $125_000. For former students who went to university with need-based government assistance known as Pell grants_ the relief will be $20_000.

US colleges can often cost anywhere between $10_000 and $70_000 a year_ leaving graduates with crushing debt as they enter the workforce.

According to government estimates_ the average debt for US college students when they graduate is $25_000_ a sum many spend years or even decades to pay back.

Biden's measure continues to be heavily debated. Estimating the plan's cost is fueling a major technical debate among experts and economists_ particularly because it is unclear regarding loan repayments already made by people who benefit from the debt forgiveness.