Students: Loans

Innovation, Universities and Skills written question – answered on 2nd March 2009.

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Photo of Shailesh Vara Shailesh Vara Shadow Deputy Leader of the House of Commons

To ask the Secretary of State for Innovation, Universities and Skills what recent assessment he has made of the effect of the economic downturn on the provision of (a) career development loans and (b) professional development loans by UK banks to students.

Photo of Siôn Simon Siôn Simon Parliamentary Under-Secretary, Department for Innovation, Universities and Skills

Career development loans (CDLs) are a successful GB wide programme administered by the Learning and Skills Council (LSC) to help individuals invest in their future by financing vocational learning of their choice. CDLs are commercial loans provided by three high street banks, for which the Government pays the interest while people study.

The LSC monitors and analyses lending trends on a continuing basis. The number of loans given so far this year is lower than forecast. The LSC believe that, in part, this reflects the banks' concerns about the economic downturn.

However, as set out in January in "New Opportunities: Fair Chances for the Future", the Government believe that loans can play a greater part in helping people gain the skills they need. Expanded and rebranded professional and career development loans (PCDLs), which will be available for courses starting in September 2009, will offer reduced headline interest rates and allow for loans up to £10,000. PCDLs will help more people seeking professional and technical qualifications get on the right track in their career, and help those who have been made redundant retrain.

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