Letter by Prof Graham Scott, on lowering the repayment threshold for student loans:
Under plans recently announced by the government, most of us will pay more tax from April 2022, but younger graduates – recently qualified nurses for example – will be particularly hard hit. Like the rest of us they will pay more in national insurance, but added to that the government wants to lower the salary threshold at which they start to repay their student loan, in effect changing the agreement they had signed up to when they took out the loan.
Currently, repayment starts when earnings reach £27,295 per year; the proposal is to lower that threshold to £21,000. That would mean that a recently qualified nurse would need to pay back as much as £400 extra each year from next year on student loan repayments alone, and it could take them the rest of their working life to clear the debt.
Remember, the government only awarded them a 3 percent pay rise this year – the increased loan payments and the increase in national insurance mean that increase will be lost at a time when living costs are spiralling.
The proposed changes are neither progressive nor fair. They hit the youngest and least able to pay in our society while the highest earners – or those able to draw upon the bank of mum and dad to clear their student loan – will be debt free in just a few years, having paid back far less.
(These changes will occur in England only, not in Wales, Scotland or Northern Ireland, unless they decide to follow suit, where education policy is decided by the devolved administrations.)
I'm just amazed that anyone expects the Tories to behave any better than this, have a look here to appreciate the full glory of their instinctive money grabbing and lack of any scrupules.
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