Liz Jarvis

I have heard from many young constituents who are frankly pretty despondent right now. They have endured a global pandemic. They are grappling with the cost of living crisis, a housing crisis and difficulties in securing entry-level jobs. On top of that, they carry the incredible burden of large student loans, made ever larger by high interest rates and a frozen repayment threshold, leaving many feeling they will never be free of it. We need to acknowledge that an entire generation of graduates on plan 2 student loans have essentially been mis-sold their loans. One constituent told me about their son who, despite repaying his loan for five years, has seen his balance increased by 33%. How can that possibly be justified? The cumulative impact of successive changes to the terms and conditions of student loans in England has fundamentally undermined confidence in the system. The threshold has been moved around haphazardly by successive Governments, being regularly frozen, including by the current Government. Many students were told that this was manageable debt, but in reality it has developed into something totally different from the graduate contribution system it was intended to be. The repayment threshold was supposed to rise with earnings. The previous Conservative Government’s decision to freeze it was a needless move to take money away from graduates. It is a stealth tax. According to the money-saving expert Martin Lewis, the most direct thing that would help all students would be not to freeze the repayment threshold. Will the Minister look at that as a matter of urgency? Student loans also impact the ability to get a mortgage because they are used for affordability calculations. There must be an immediate reversal of the repayment threshold freeze, and RPI should no longer be used to calculate interest.