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Students may never repay loans

Many graduates are unlikely to ever pay back their tuition fee loans, regardless of the cost of their course, it has been suggested.

There is little difference in the amount of money many students will pay back whether they take a course that costs £6,000, or £9,000 a year, according to Martin Lewis of

Even those that start work on salaries of £30,000 are unlikely to pay off their loans in full after 30 years, when the debt is written off, he said.

More than a third of English universities are due to charge fees of £9,000 as standard from 2012, while almost three fifths will charge the maximum for at least one of their undergraduate courses.

The move to triple fees, agreed by MPs last December, has led to concerns by many that poorer students will be priced out, and that youngsters will be put off by high fees.

Mr Lewis, who is leading an independent student finance taskforce said that in many cases, fee levels will be "irrelevant" in terms of repayments.

"For many students, even those on higher earnings, they will not repay at £6,000 never mind £9,000," he said.

Warning that there is still much confusion over the new system, Mr Lewis said: "There are a couple of things people don't get. The first is, at a basic level, whether to go for £6,000 or £9,000. You will repay the same each month as the repayments depend on what you earn.

"You only repay over £21,000 and repay 9% of everything over that £21,000 and that will rise with average earnings.

"The amount of fees you have is irrelevant for monthly repayments."


From Belfast Telegraph