'Stopping graduates repaying student loans early...' blog di

lighting

The other key point is that at over £21k income pa the tax rate will be 40% (20% income tax + 11% NI + 9% loan repayment). So for every extra £1 earned, the govt will take 40p.
Whlist this was also the case under the old system, the higher amount of loan plus 3% real interest rate will mean that graduates will pay 40% tax on very modest earnings till they are 50.


These loans are indeed poison

tubbee2

Older not Wiser you make sense. I graduated in 1986 and actually queued up each term to collect a grant cheque. I now have the pleasure of teaching undergraduates and am firmly of the opinion that many of my students would be far better off foregoing the 'uni' experience. By the way when did academically rigorous study - university - become 3 years of hedonism with a couple of lectures thrown in - uni? Widening access to higher education has had the inevitable effect of increasing entry numbers and the money to pay for it has to come from somewhere. My daughter has graduated with a masters and £20,000 of debt and my son is applying to take a law degree and will also graduate with debt but what is the alternative? Restrict entry to academic degrees only, decrease the numbers eligible to apply and bring back the polytechnics and vocational training? Wait for the outcry then.
tb2

jane_xphile

I have a daughter who has just gone to university under the old system and an able son in Year 11 who has always been brought up to expect to go. I agree with Martin about the appalling unfairness of penalising up front payment/early repayment. What I would like to see is some way of taking out partial loans and paying partially upfront (at least if this divisive system is going to come in). Since the talk has all been about tuition fees, the problem of maintenance has been largely ignored. We are on a pair of public sector salaries, not that huge (although not penurious either) - ironically we work for a Russell Group university. We earn too much between us to be eligible for anything other than the minimum maintenance loan under the current system and no student can subsist on that - bank of mum and dad is built in from day one. The way we have worked it so far is that we are saving monthly ahead of the game and paying accommodation costs up front - daughter then uses the loan for everything else. We shall also encourage son to take a gap year - three years between them, four-year course for daughter, don't want to be paying for both of them at once. But while we are determined son should have the same chance as daughter (within reason - he's unlikely to make Oxford), the commercial rate of interest does worry me. We have always prided ourselves on the fact that the only loan we've ever had is the mortgage (and that for not much longer, hurrah!) I am sure this system is going to put university back on an elitist footing, only for the rich rather than the academically elite this time).

Not to mention the cases my daughter has met at Oxford of parents whose children went to hugely expensive public schools and yet are in receipt of the full grant and maximum loan as the parents pay themselves minute 'salaries' out of their flourishing business interests. This is an immoral disgrace and a loophole which MUST be closed as a matter of urgency.

XRAT

Why is it that the government pension I paid into is changing from the RPI to the CPI just as I come to draw it.., yet the new student loans my kids are about to take on are linked to the RPI????

I have a son and a daughter. I plan to lend my son money so that he doesn't take student loans and can make early repayments if he chooses. My daughter can take the student loans so that they are written off after she takes 20 years out to raise children.

catnicex

Has this been confirmed or not?
Many thanks
A.