Students: Loans

Department for Education written question – answered on 10th September 2018.

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Photo of Angela Rayner Angela Rayner Shadow Secretary of State for Education

To ask the Secretary of State for Education, what estimate he has made of the additional ring-fenced RDEL his Department will require to fund the increased RAB charge resulting from the increase to post-2012 loan repayment thresholds in each of the next three financial years.

Photo of Sam Gyimah Sam Gyimah Minister of State (Business, Energy and Industrial Strategy) (Higher Education), Minister of State (Education)

As in previous years, the allocated budget for Resource Allocation Budget (RAB) expenditure was published in the DfE Annual Report and Accounts 2017/18, which can be accessed here: https://www.gov.uk/government/publications/dfe-consolidated-annual-report-and-accounts-2017-to-2018 . The budget for RAB expenditure is part of the depreciation figure and is shown as c.£3.9 billion for 2018/19 and c.£4.3 billion in 2019/20.

The 2018/19 budget and future budgets will be reviewed as part of the annual estimates process and confirmed in the published estimates documents. No budget has been allocated for 2020-21, this will be agreed as part of the next spending review.

This follows the department’s statistical release on student loan forecasts published on 28 June 2018, which showed the RAB charge for higher education loans is expected to be 45% under the new policy: https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/719817/Student_loan_forecasts_2017-18.pdf

The cost of the system is a conscious investment in young people and required to make higher and further education widely available, achieving the government’s objectives of increasing the skills in the economy and ensuring access to university for all with the potential to benefit. We have added to that investment recently by freezing tuition fees for academic years 2018/19 and 2019/20, and raising the repayment threshold from £21,000 to £25,000 for the financial year 2018/19.

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