Plan 5 student loans - how will they apply to PGCE students?

ihatebarclays_2

Hello,

My daughter is just finishing her undergraduate degree, so she is on a Plan 2 loan.

In September she will start a PGCE. My understanding is that PGCE loans are treated as undergrad rather than postgrad loans, so presumably her new loan will be added to her existing loan.

However I have just heard about Plan 5 and am confused about how this will apply to students like my daughter. Will her entire loan become a Plan 5 loan? Or because she started on Plan 2, will she continue on Plan 2? I don't see how it would be possible to have only part of the loan on Plan 5, seeing as you can only have one threshold.

Obviously this will have a dramatic bearing on her future repayments so I need to know how it works. I have tried to find the answer on-line - including reading the entire terms and conditions for 2023/24 - but I cannot find anything that deals with this specifically, even though there must be quite a lot of students who will be in the same position.

Does anybody have any information on this? It would be much appreciated.

silvercar

It is clear in the guidelines here: https://www.gov.uk/repaying-your-student-loan/which-repayment-plan-you-are-on

PGCE starting after August 2023 will be plan 5.

The existing student loan will remain as a plan 2 loan.

So she will end up with two loans, one on plan 2 and one on plan 5. Her repayments are governed by the thresholds for each plan. So she will pay 9% of earnings over the lower threshold. 

Edit: plan 5 loans don't go into repayment until April 2026, so until that date all the repayments will go to the plan 2 loan. after that date the repayments will be split between the loans, but she still only has to make one repayment.

ihatebarclays_2

silvercar, just realised I forgot to thank you for this, which was very remiss of me. Thank you.