Student Loans
14 Sep 2026 · Commons Chamber · 21 speeches · Official record
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I thank my hon. Friend for her statement. I was glad to be part of the Committee, which looked at ways in which we could start to make the student finance system fairer. On the issue of whether we should reverse the threshold repayment freeze, we looked at a number of ways in which we could change the financing system to make it fairer-for instance, by freezing or even cutting the interest rate cap-and reversing the threshold repayment freeze was the best way to get help to the great majority of... Full speech
It is not only my hon. Friend, I and the Committee who agree on that-it is the Government too. The Secretary of State for Education herself has said there are problems and previous Ministers have called it a broken system. There is a long way to move from a broken system to one that is fair, and the focus of our recommendations is on those who are currently paying back a loan. It is difficult to right all the wrongs for those people, but we think pulling back on the threshold freeze would be an ... Full speech
I thank my hon. Friend for her excellent work and that of her Committee. We want our young people to have confidence that their Government will stick to their promises. Does she agree that the approach to student loans from successive Governments has dented that trust and that Government colleagues should reflect on that? Full speech
On 27 March 2026, the Minister for Skills wrote to my hon. Friend the Member for Brentford and Isleworth (Ruth Cadbury) confirming that the Department for Education would release an equality impact assessment on student loan lifetime repayments and other borrower impacts for the plan 2 repayment threshold. Does the Chair of the Treasury Committee agree it is high time that the equality impact assessment was published by the Department? Full speech
One of my constituents has been in touch. He is a neonatal nutritionist and is paying a marginal tax rate on his loan of 57%. Does the Chair of the Treasury Committee agree that that is not an acceptable outcome socially and that we must have change? Full speech
When I looked at this issue in previous roles, before I was on the Treasury Committee, I found that one of the challenges is that the loan system is set up with lots of box-ticking and spreadsheets happening in Government Departments in Whitehall-a very long way from a 17-year-old who takes out a loan and starts paying it back after they graduate. We need to have them at the heart of the design. There will always be a discussion in government about where money is best spent and how much things c... Full speech
I am pleased to rise to make a statement on the Government’s response to the Treasury Committee’s report on the student loans system. It is worth laying out what our inquiry did. We took evidence from a number of people, including students and graduate representatives at the National Union of Students; Rethink Repayment, which was set up by one of my constituents on behalf of affected graduates; and the union Prospect. We also took evidence from the Institute for Fiscal Studies, Universities UK ... Full speech
I thank the hon. Lady for her clear summation of the Committee’s report. I want to press her on the repayment threshold. She says that in the Government’s response, they have not ruled out reviewing it, but given the relatively modest amount of money and the significant number of young people who would be positively affected, does she think that this should be one of the top priorities for the new Chancellor on 28 October? Full speech
I thank my hon. Friend for her Committee’s excellent work on the important issue of student loans and for the good communication that she maintained with my Select Committee during her inquiry. The Education Committee concluded earlier this year that there is a genuine crisis in the financial sustainability of our universities as a result of many different pressures bearing down on them. Does she agree that if the Government do not bring forward additional measures to improve the long-term affor... Full speech
We now come to the Select Committee statement on behalf of the Treasury Committee. The Chair of the Treasury Committee, the hon. Member for Hackney South and Shoreditch (Dame Meg Hillier), will speak for up to 10 minutes, during which time no interventions may be taken. At the conclusion of her statement, I will call Members to ask questions on the subject of the statement. These should be brief questions and not full speeches. I emphasise that questions should be directed to the Select Committe... Full speech
As my hon. Friend said, we looked at a number of ways of changing things. Once somebody has a plan that has been set up, it is very difficult to unpick different parts of it, but the threshold freeze was added on top of the plan 2 system. That is why it seems particularly invidious. There is an opportunity here-a simple lever that the Government can pull-because the freeze has not yet been implemented. If the Chancellor is looking for a quick win in the Budget, that is one of the easiest things ... Full speech
I speak as the mother of three students, one of whom has just graduated. Two of them have a plan 2 loan, and one has a plan 5 loan. They and I were unaware that they are not allowed to start repaying their debt until they graduate, yet the interest starts from the very first day that they take the loan, which can be a gap of three or four years or, as was suggested earlier, even six or seven years. That adds between £5,000 and £8,000 to their borrowing. Did the Committee look at that? Has it mad... Full speech
In that simple question, my hon. Friend raises a raft of issues. For most students, the only way that they can go to university is by getting a loan. There has been a big drive to get people to go to university who would not have been able to do so before, partly because they may be from poorer backgrounds. This Government have added in extra support through the maintenance grant and so on, but there are still huge costs on young people. It is really important that in making decisions, especiall... Full speech
Order. We have about 10 minutes for questions and answers, so they must be brief. Full speech
The Committee certainly received some evidence on that issue. There is a logic to not paying back the loan until that point, because students are mostly not working, so there would be a real challenge in paying it back while someone is an undergraduate or graduate student. The hon. Lady rightly highlights that that has caught a lot of people unawares, as they were not aware of how much it ratchets up. There is layer upon layer of complexity, and the fact is that parents do not fully understand t... Full speech
I thank my hon. Friend for the excellent work that she and her Committee do. We know that there is a crisis in the higher education system, but there is also a huge challenge for the graduates paying off these loans. It is a multifaceted picture, so I am pleased that the Government are looking at reviewing it, but people have just started plan 5 repayments, and a review that might see any changes is still a long way off. We need to have the national conversation that I mentioned about a 50:50 ba... Full speech
One of the themes that comes through quite clearly in the report is the complexity of the student finance system and the difficulty that students have in understanding what they will actually pay-that is mis-selling, as I think my hon. Friend described it. Given that the Government appear to accept that the terms are confusing, is it fair that they continue to penalise borrowers who were potentially misled? Full speech
One good thing is that the Government have recognised that problem in their response to us. We are dealing with mostly teenagers under the age of 18. Sometimes those going to university for the first time do not have other people around them who can advise them about the impact of a loan, and many have no choice and have to take out a loan. The cohort now paying back under plan 2 is being further penalised by the threshold change, so more and more is being layered on that particular cohort. Ther... Full speech
I thank the Committee for its work and for the report. I completely agree with the Chair’s presentation of the level of mistrust among graduates and learners when it comes to the broken system. Does she agree with me that this is not simply a communications issue? It is not about telling people more clearly how bad a deal they have. Fundamentally, this is a broken system-a bad deal that is having massive intergenerational impacts. Does she agree that we need a full and thorough review of the stu... Full speech
My hon. Friend says it better than I could. There is a trust relationship, and in the case of student loans, students have nowhere else to go for that money. They signed up on certain terms, and those terms have been changed by successive Governments, and the latest threshold freeze is just another one of those breaches of trust between the Government and those who trust them in taking out a loan. Full speech
I absolutely think it should be a high priority, because this generation is being so severely squeezed. The Government’s response to the Committee said: “The Government recognises the cost-of-living challenges faced by many graduates, including those with Plan 2 student loans, and understands concerns about the impact of repayment terms on borrowers.” The response says further that the Government “keep all aspects of the student finance system under review.” This is one change that is very simpl... Full speech