Students: Loans

Department for Education written question – answered at on 13 September 2016.

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Photo of Alex Chalk Alex Chalk Conservative, Cheltenham

To ask the Secretary of State for Education, what estimate her Department has made of the cost to the public purse of uprating the earnings threshold for graduate repayments of student loans.

Photo of Jo Johnson Jo Johnson Minister of State (Department for Education) (Universities and Science) (Joint with the Department for Business, Energy and Industrial Strategy), Minister of State (Department for Business, Energy and Industrial Strategy) (Universities and Science) (Joint with the Department for Education)

In 2015 the government chose not to uprate from April 2017 the loan repayment threshold for ‘plan 2’ student loans — those issued for course starting from 2012 onwards. This decision will be reviewed again in 2021. The government consulted on this decision and published a detailed consultation response.

The forecasted cost of uprating the repayment threshold by earnings growth from April 2017 would be equal to the forecasted savings from freezing the threshold. These figures can be found in paragraphs 67 and 68 of the consultation response.

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