Education Secretary Bridget Phillipson has said she will “look at” Plan B student loans amid widespread concerns
The Education Secretary has said she will “look at” Plan B student loans following widespread alarm over spiralling costs. However, she stopped short of pledging any concrete reforms to the system.
Bridget Phillipson maintained she sought “fairer” arrangements for graduates but cautioned that the Government faced “a question of priorities” when pressed on whether the financial burden would be lightened. In the wake of Chancellor Rachel Reeves‘ November budget, the salary threshold triggering repayments under Plan B will remain frozen at £29,385 for three years, meaning countless graduates will face heftier bills. Interest on these loans stands at the Retail Prices Index (RPI) inflation rate plus as much as 3%, varying according to a graduate’s earnings.
The Conservatives have vowed to cap this at RPI alone while slashing university places and boosting apprenticeship numbers, in proposals set to pile additional pressure on the Treasury.
Speaking to broadcasters on Sunday, Ms Phillipson remarked it was “galling that the very people who designed, implemented and delivered that system are now complaining about the fundamental problems that they see within it”.
She also lambasted proposals to shrink university admissions, arguing these came from individuals who “had the benefits of a university education” themselves and now sought to withhold it from others. “I’m not in the business of pulling up the drawbridge behind me and saying to other young people who are ambitious, who want a chance to go to university, that they’re going on to study on poor-quality courses,” Ms Phillipson said.
When questioned whether the Government would reform the Plan B system – which critics have likened to a “loan shark” operation run by the Treasury – she told the BBC’s Sunday With Laura Kuenssberg: “I will look at it, of course I will.”
‘I see the issue’
Ms Phillipson maintained that graduates in their 30s were receiving support through alternative means, pointing to expanded free childcare provision, frozen rail fares and “investment in housing”.
Pressed on whether the Government would specifically ease the repayments, she told Sky News’ Sunday Morning Trevor Phillips: “I get the problem. I see the issue.
“In reality as a Government, you have to look at a question of priorities, and what you can do and how fast you can do it, and given the shape of what we have in the public finances this is really hard.”
Shadow education secretary Laura Trott argued the Tories wanted to axe funding for “dead-end university courses”, which she claimed were leaving graduates facing bleaker employment prospects.
Under Conservative proposals, young people entering their first full-time employment would also have the initial £5,000 of national insurance contributions they pay deposited into a personal savings account, which could be put towards purchasing a home, the party claims.
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