'Urgent! Help fight the Government’s student loan U-turn that could cost...'

Ed-1

dizzie wrote: »

If this change goes through retrospectively, then we will know one thing for sure. If you take out a student loan, by signing on that dotted line, you are giving the UK government a licence to charge you what they want, whenever they want! After all, what is stopping them making further retrospective changes in the future?

Nothing is stopping governments from making changes. That has been the case since 1998 - the reforms in 2012 were presented as a 'new system' when in reality all they were were an amendment to the same legislation that has been in place since 1998 which has always been set up to allow governments to change the terms as they wish.

When wholesale changes take place such as those in 2006 and 2012 changes are generally not applied retrospectively as rather than picking and mixing which terms to change, they are just applied to new borrowers. However, when individual terms are being changed, they are generally applied retrospectively.

For terms that have not yet been implemented into the regulations, they are always dropped retrospectively (e.g. repayment holidays for 2008+ starters).

dizzie wrote: »

If this happens, then future students should be concerned and we should perhaps start calling this the Student Loan Gamble!

Or as Martin Lewis prefers, the graduate contribution/tax.

dizzie

Ed-1,

Lets get one thing straight! Whether the government have scammed people before or not does NOT excuse them from doing it again! We are dealing with much bigger levels of debt than ever before!

Do you think that it is right that a government should go out of its way to soften the blow of a massive hike in tuition fees by making soothing sounding lies about how the new tuition fees will work in order that people will not be put off higher education in the UK?

Do you think it is right that they should even recruit a task force to hammer these promises home and then change their mind having sucked in the gullible and the trusting?

YES or NO?

And, do you think that thousands of 18 year olds do lots of research on the legal aspects of such forcibly voiced commitments and research historical evidence to see whether retrospective changes have been made before? Or do you think that they trust what they are told? I mean, this IS meant to be the UK Government who regulate to protect us from unscrupulous people like loan sharks after all.

How ironic that they apply regulations to protect the public from everyone else....then consider playing the role of con merchant themselves!

photome

photome wrote: »

I have filled in the online response as my MP cant be bothered to reply

I have now had a reply from my MP to her credit.

She does say she has asked the minister to reconsider option 2 , making the reform effective only for future students

That is how it should be...no one should be able to make retrospective changes!!!

dizzie

For prospective students, I would highly recommend that you consider other EU destinations for your higher education. Besides offering better value for money, you will gain a diverse cultural experience. A lot of courses in Europe are taught in English. In fact, you'll gain a lot of friends because a lot of people want to improve their English! Why not start with an internet search? I understand that some of the Dutch Universities are also going to be available via the UCAS application service which means that you won't even necessarily have to get to grips with the application system in another country.

....And the Netherlands has been voted the 7th most happy place in the world to live. The UK was not in the top ten by the way....and given 5 more years of this government, I am guessing it might struggle to make the top 100!

alibean121

photome wrote: »

I have now had a reply from my MP to her credit.

She does say she has asked the minister to reconsider option 2 , making the reform effective only for future students

That is how it should be...no one should be able to make retrospective changes!!!

I already know the answer, it's too complex. There's already an admin nightmare brewing come April when loans with different thresholds come into payment for the first time.

How your employer is supposed to know what threshold to use remains a mystery with only 6 months to go. A 3rd threshold would be ridiculous.

It's not actually the first time this has happened though. Post-06 loans were also supposed to have an uprated threshold but this was also quietly scrapped and didn't start to happen until the new system came in during 2012.

dizzie

alibean121 wrote: »

I already know the answer, it's too complex. There's already an admin nightmare brewing come April when loans with different thresholds come into payment for the first time.

How your employer is supposed to know what threshold to use remains a mystery with only 6 months to go. A 3rd threshold would be ridiculous.

Alibean, this should not be the admin nightmare you suggest. After all, employers have to use different national insurance codes for different people: A young person may be code M, someone else code A and another person code C etc...because the payments required from employee/employer for each different code group differs.

Surely, all they need to do is to give the respective different era loans "codes" and then payroll software providers can incorporate these into their programmes for automatic calculations of student loan deductions. This should not be difficult to do for larger companies.

And for smaller businesses say, with only a few employees, if their payroll software is too basic, there could perhaps be an online calculator to use for differently coded loans. After all, when pension auto-enrollment hits the smallest business, software like the basic/free HMRC PAYE tool does not do pension calculation deductions for you - employers will either be required to perform the calculation manually or to change their software if they want this done for them.

setmefree2

The repayment rate on existing student loan debt could be increased by the Government within the next few years, the Business Secretary has confirmed.

Sajid Javid said he could not rule out retroactively increasing the amount graduates had to pay out of their salary before the next election.


Graduates currently pay 9 per cent of their income above a £21,000 repayment threshold, but the Business Secretary said the threshold or repayment rates might have to go up to stop budget pressures getting “out of control”.


The minister appeared on Wednesday in front of Parliament’s Business, Innovation and Skill Committee, which scrutinises university funding.


Labour MP Paul Blomfield asked Mr Javid whether he had “any intention of changing either the threshold or the interest rates within the lifetime of this parliament”.


Mr Javid replied that he could not “commit” to such a pledge.
“I can’t tell you here and now that any of those numbers I’ve mentioned [repayment rate, repayment threshold, length of loan] can’t change during the life of this parliament but there are no current plans. It’s something that I just don’t think I can commit the government to,” he replied.

http://www.independent.co.uk/news/uk/politics/student-loan-repayment-rate-could-go-up-in-the-next-few-years-government-confirms-a6694116.html

So this means that all student loans could be effected be retrospective changes not just 2012+ .

Of course, he's not saying the government will change terms & conditions just that he won't rule it out.

setmefree2

dizzie wrote: »

Do you think that it is right that a government should go out of its way to soften the blow of a massive hike in tuition fees by making soothing sounding lies about how the new tuition fees will work in order that people will not be put off higher education in the UK?

Do you think it is right that they should even recruit a task force to hammer these promises home and then change their mind having sucked in the gullible and the trusting?

YES or NO?

I'll add one more.

Do you think it's right that lots of parents trying to work out whether to pay tuition fees upfront were lied to?

And, might I add, those same parents/students were ridiculed by some who should have known better.

To quote Martin Lewis

A laudable aim gone wrong.

"We've a great story. A girl's saved up nearly £30,000, so her parents don't have to borrow for her £9,000 tuition fees – she's a role model."
I almost shivered with fear when a journalist told me this. While it's bravo for the saving habit, the idea of this being a role model to follow couldn't be further off the financial mark for many. It's a symptom of the widespread misunderstanding of the changes to English student finance in 2012.

"I almost shivered with fear" - I do wish he'd shivered with fear about the governments potential to change terms and conditions.

Dougalina

This was the reply from Mr Justin Tomlinson:

Thank you for contacting me about the student loan repayment threshold, it is appreciated.

The Government is committed to maintaining the UK’s world class higher education system. I am encouraged that record numbers of young people have secured places this year, including record numbers from disadvantaged backgrounds, and that higher education will remain accessible to all who have the ability to benefit from it, with no need to pay for tuition fees up-front.

Higher education continues to be an excellent investment and graduates will go on to earn more on average than those without higher level qualifications. I therefore believe it is right that future graduates should meet more of the costs of their studies once they are earning.

As you are aware, the repayment threshold was set to £21,000 for post-2012 borrowers. However, to ensure that the costs of the student loan book remain transparent and affordable in the long term, the Government is consulting on a proposal to keep the loan repayment threshold at £21,000 for five years for loans issued to entrants after September 2012.

Further details of the Government’s consultation can be found at the following address:



***



Thank you again for taking the time to contact me. If I can be of any further assistance on this or any other matter, then please do not hesitate to contact me.


So, he is all for the change!

jackieblack

I've had two responses from my MP
First one:
Thank you for contacting me about the student loan repayment threshold and your concerns.

The Government is committed to maintaining the UK’s world class higher education system. I am encouraged that record numbers of young people have secured places this year, including record numbers from disadvantaged backgrounds, and that higher education will remain accessible to all who have the ability to benefit from it, with no need to pay for tuition fees up-front.

Higher education continues to be an excellent investment and graduates will go on to earn more on average than those without higher level qualifications. I therefore believe it is right that future graduates should meet more of the costs of their studies once they are earning.

Nevertheless, I appreciate that you are concerned about the Government’s proposal to keep the loan repayment threshold at £21,000 for five years for loans issued to entrants after September 2012, the purpose of which is to ensure that the costs of the student loan book remain transparent and affordable in the long term. I am therefore writing to Jo Johnson MP, Minister of State for Universities and Science at the Department for Business, Innovation and Skills to raise your concerns and to seek the Government’s explanation of this matter. I will respond further when I have heard back from the Minister.

Further details of the Government’s consultation can be found at the following address: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/447565/BIS-15-445-student-loan-repayment-threshold-consultation.pdf

Thank you once again for taking the time to contact me.




Second one, a couple of weeks later, from the MP's office:


Further to our previous correspondence, (name of MP) has now received a response from Jo Johnson MP, Minister of State for Universities and Science at the Department for Business, Innovation and Skills.

The Minister advises (name of MP) that the Government is committed to maintaining the UK's world class Higher Education system and that higher education continues to be an excellent investment, with graduates earning more on average than those with lower levels of qualification. However, the Minister advises (name of MP) that as more students than ever are enabled to study, the Government must also ensure that the system remains financially sustainable. For this reason, on 8th July 2015, the Government announced an intention to consult on keeping the repayment threshold at the same level (£21,000) for five years. This consultation has aimed to gather views on this proposal to ensure that higher education remains open and affordable to students and graduates, and fair to all taxpayers in the long term. The consultation closed on 14th October 2015. The Minister states that responses will help inform policy development and the Government's response will be published in due course.

I hope this clarifies the Government's position for you.

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I didn't need the position clarifying! I understood it perfectly well! :mad:
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