Martin Lewis: The Augar report heralds the end of student 'loans' - Editorial Comment

The student finance system has long been broken. Today the Government-commissioned Augar report on further and higher education is released, including detailed recommendations to change student finance in England. During the consultation process, I twice met Philip Augar to push for fairness and transparency in the system, and MSE’s Campaigns team submitted a formal response...
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'Martin Lewis: The Augar report heralds the end of student ‘loans’'
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Comments

  • I am currently working but considering attending university, does this mean i would be better enrolling September 2020 before these changes are implemented?
  • Ed-1
    Ed-1 Posts: 3,852
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    I am currently working but considering attending university, does this mean i would be better enrolling September 2020 before these changes are implemented?

    Probably. It remains to be seen if they will be implemented or implemented in the way the review wants though. The new government could stay well away or pick and mix the recommendations. They may also have a different view on the inequity of leaving existing loans with such generous terms in comparison.
  • Hi Martin,
    I think the interesting thing about the current loan system (Plan 2 loans) is that it actually penalises mid-earners the hardest, since they will earn just enough to pay off the loan + interest, but not enough to pay it off early like those who earn exceptionally high salaries will do. In this way, it loses its efficacy as a graduate tax above a certain threshold. However I'm not sure how this problem might be addressed; lower interest rates charged on the loan might help. Given, this only affects a small bracket of graduates with relatively high salaries, and is presumably an unintended consequence of various other factors in place. I wonder how this will change under the new Augar guidelines?
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