BRISBANE, May 17 - The federal budget proposed raising university fees and slashing the threshold for HECS repayments, meaning university graduates will have to start paying off their school loans earlier.

Critics say it will make it harder for young people to afford higher education, as well as increasing the debt burden on students.

Queensland Senator Larissa Waters addressed the rally saying the government thought it could "make savings at the expense of students".

"Why can this government find $65 billion worth of corporate tax cuts, and yet wants to rip $4 billion out of our universities?" Senator Waters said.

"Young people are seeing cuts to universities, cuts to penalty rates, they can't get into the housing market, and the government's doing nothing about climate change.

"This government seems to have forgotten that they too were young once."