Figures have revealed that 45% of university graduates will never earn enough to repay their student loans. Statistics show that if this percentage reaches 48.6%, the government will lose more money than it gained by increasing annual tuition fees to £9,000 in England back in 2012.
This announcement comes with recent news that the Conservative universities minister, David Willetts, has refused to rule out raising tuition fees for students after the next election. He commented that the government would ‘have to see how the income of universities performs’ before making any decisions regarding student loans.
Released this weekend, numbers are subject to change depending on graduate income and the UK’s economic circumstances. It is estimated, however, that 28% of loans will never be paid back in full. According to Nick Hillman, Willett’s former political advisor, this figure is much higher than expected.
Currently, students do not pay their fees upfront and only have to start repaying when they are earning a minimum of £21,000 a year. Graduates will pay back 9% of any income over £21,000 each month. Scottish students study in Scotland for free and Northern Irish students similarly pay a maximum of £3,685 at universities in Northern Ireland. With Welsh government and local authorities covering the remainder of their fees, students in Wales pay a maximum of £3,685 wherever they study in the UK.
A second year Human Biosciences student commented: ‘Such a high percentage as this encourages me to take out as big a maintenance loan as possible, especially with the knowledge that I may never pay it back.’
Laura-Jane Tiley, Online News Editorbookmark me