Save time by listening to our audio articles as you multitaskFrom September 2023 this system is set to change. The Department for Education announced a suite of reforms earlier this year. They range from the eye-catching to the wonkish . Taken together, they amount to the biggest overhaul of student finance since tuition fees were tripled in 2012.
. Less punitive interest rates for higher earners mean that those in the top decile of lifetime earnings can expect to pay back £25,000 less than under the current arrangement. Meanwhile, the extended repayment term and the lower earnings threshold mean that lower and middle earners will pay more: around £30,000 more for those in the third income decile.
The reforms have much to recommend them. There is some evidence that the prospect of taking on debt has a deterrent effect on people from poorer backgrounds who are considering going to university. But the earnings threshold continues to protect people from repayments until they are pocketing a certain wage. Taxpayers will save £2.8bn for each university cohort.
But the changes fail to fix some big shortcomings in the current set-up. Mr Waltmann points out that maintenance support, loans to help pay for living costs, is now falling fast in real terms. Payments are based on old forecasts of retail price index inflation that underestimated how quickly the index would rise. He calculates that students from the poorest families will receive £100 a month less than they would have done had their support been linked to actualinflation.
Worse, as well as changing the rules for future students, the reforms also rewrite repayment terms for the roughly 3.5m people who have taken out loans since 2012. A frozen earnings threshold will increase their monthly repayments from this September, just as the rising cost of living really starts to bite. Linking this threshold in the future to the, a flawed measure of inflation that is set to be reformed, bakes in further uncertainty.
50% fewer EU Students for Oxford we note, as reported here today in Sunny EU Berlin - Cripes!
Despite Covid, rising inflation and the Ukraine crisis, Germany will soon introduce a monthly ticket for all local transport (Nationwide) of €9, why doesn't Third Country Britain do the same then?
That seems like a good idea: we wouldn't want the rich paying more, would we? ;-)
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Good to hear because if you can't pay for your student loans YOU deserve EVERYTHING coming for you!
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