Barry Sheerman – 2016 Parliamentary Question to the Department for Business, Innovation and Skills

The below Parliamentary question was asked by Barry Sheerman on 2016-01-05.

To ask the Secretary of State for Business, Innovation and Skills, what estimate his Department has made of the proportion of current and past students who it expects will be able to pay off their student loans in full.

Joseph Johnson

The student loan system is progressive, with income contingent repayments protecting those on the lowest incomes and loans that have not been fully repaid being cancelled after 30 years. Therefore only a proportion of students are expected to fully repay their loans within this repayment term, although almost all students will repay at least part of their loan.

The BIS Student Loan Repayment Model forecasts that around 45% of current full time students will fully repay their student loan. The majority of these students have Plan 2 student loans.

It is forecast that around 75% of all past students with student loans since 1998 that are still making repayments will fully repay their student loan. This includes all full time students that finished their courses in the 2015/16 financial year or earlier, the majority of whom have Plan 1 student loans.

The above figure for past students does not include those borrowers who have already fully repaid their student loan or had it cancelled. The Student Loan Company publication ‘Student Loans in England: financial year 2014-15’ published in June 2015 shows statistics on the number of borrowers that had fully repaid their loans or had them cancelled up to the end of April 2015. This can be found at the following link:

http://www.slc.co.uk/official-statistics/student-loans-debt-and-repayment/england.aspx

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