A little bit about it: under the current system, graduates repay loans once they earn £27,295 per year, and the repayment amount per month corresponds with how much is affordable based on their income. The average debt of graduates in 2020 was £45,000, with the government estimating that only 25% of graduates fully pay off this debt, as any outstanding balance is wiped off after thirty years. I would argue that this percentage is more a comment on how valued post-graduate jobs are if anything. It seems as though, the government has looked at this and decided to deter people from attending university with their new proposal.
This would include lowering the repayment threshold from the current £27,295 to £21,000, which would indeed save the government nearly £3 billion per year, but for graduates, repayments would more than treble. As an example, a current graduate who earns £30,000 per year currently repays £243 per annum and would see this rise to £800.
Although the prospect of repaying loans is a constant presence, it is not, in my experience, in any way as oppressive as it would be under the new system. Many young people would be dissuaded from attending university, with this new system further disproportionately affecting students from poorer backgrounds. These students simply would not have the income to repay loans and afford to live. I am not arguing in any way that by lowering the threshold any graduate would benefit, but focusing on the economic consequences, poor students would be harder hit.
The government’s aim is to push younger people into vocational courses. Of course, vocational careers are important, but shouldn’t be viewed as the economic alternative at the expense of a university degree. This comes in the wake of the government’s appalling attitude towards the Arts during the pandemic, demonstrated in the infamous ‘Rethink, Reskill, Reboot,’ advert, suggesting that Fatima’s next job could be in cyber as opposed to ballet. If they go ahead with lowering the repayment threshold, it will not only impact graduates, but will dissuade younger people from joining university, and as a final nail in the coffin, will have devastating consequences for the Arts.