Govt may lower salary threshold for student loan repayments

Ministers will allegedly propose lowering the salary level at which graduates begin repaying their student loans.

Chancellor Rishi Sunak reportedly wants to overhaul student financing ahead of the October Budget, according to the Financial Times, over concerns the taxpayer foots too large a bill for higher education.

Graduates currently begin paying back student loans when they have earned £27,295 or more, but one unnamed minister told the paper that “the plan” is to reduce that figure.

While no final decisions are understood to have been made yet, one minister told the FT a £20,000 threshold was considered “a bit low”.

These reports come at the same time as increasing concerns over the cost of living have arisen from a combination of rising gas prices, the approaching end of the £20 Universal Credit uplift and furlough scheme, and plans for a 1.25 per cent rise in National Insurance contributions.