MSE News: PM pledges to raise student loan repayment threshold

silvercar

Wilt wrote: »

Can this be removed from the article? Most current graduates wont benefit unless govt pulls something for pre-2012 loans out of the bag.

To be fair the article is clearly only referring to post 2012 loans.

glider3560

silvercar wrote: »

To be fair the article is clearly only referring to post 2012 loans.

I think the article has just been updated

Former_MSE_Andrea

Thanks folks, yes, the news story's been updated

agrinnall

Lorian wrote: »

I don't think this will buy her any student votes. She'd would need to reduce the fees at least as far as £7.5K to get some traction.

As Martin explained on his section on 5Live today (from 12:50 - 12:55, curtailed because of events in Las Vegas) reducing the fees has no impact on how much is repaid for the vast majority who will never repay the full amount anyway, whereas the increase in the threshold means less to pay for anyone (except the very high earners) earning over £21K for as long as they earn at above that level. Even at £25K threshold it could add up to £360 * 30 years = £10,800. And if the threshold does increase annually as promised the saving will be even more.

robin58

MSE a 'pledge' is not a 'victory' until the result is in black and andl has a parliamentary law to inforce it.

Merlin's_Beard

Wilt wrote: »

Can this be removed from the article? Most current graduates wont benefit unless govt pulls something for pre-2012 loans out of the bag.

Obviously if you're a pre-2012 graduate the government thinks you have less need of money compared to a post-2012 graduate on the same salary as you!

silvercar

Merlin's_Beard wrote: »

Obviously if you're a pre-2012 graduate the government thinks you have less need of money compared to a post-2012 graduate on the same salary as you!

Pre-2012 students are more likely to be able to clear all their loan as their loans were for a far lower amount. Therefore the calculation is different as interest added will make a significant element of the loan. So lower initial repayments, by raising thresholds, will actually cost them more in greater interest that will be repaid.

Lorian

If they go to university and generate say £60K debt without expecting to earn at least £25K at some point then I'm lost as to see why they would go in the first place.

Ed-1

Lorian wrote: »

If they go to university and generate say £60K debt without expecting to earn at least £25K at some point then I'm lost as to see why they would go in the first place.

But it's not a case of earn £25k and you've got to repay the full whack. It's a case of earn over £25k and you contribute 9% of your salary over the threshold. It's a tax cut. Expect the threshold to come down sharpish once a competent government get in as it can't be sustained at these levels of write offs.

Mogley

Ed-1 wrote: »

But it's not a case of earn £25k and you've got to repay the full whack. It's a case of earn over £25k and you contribute 9% of your salary over the threshold. It's a tax cut. Expect the threshold to come down sharpish once a competent government get in as it can't be sustained at these levels of write offs.

I think even a competent government will realise the impact on the country will be too far in the future for a 5 year tenure to concern themselves over ruining their popularity. I can see state pensions being wiped in 25 to 30 years time (for the post 2012 era) to pay for the levels of write-off.