Magazine article The Times Higher Education Supplement : THE

HELP Could Force Graduates to Clear Debt Faster

Magazine article The Times Higher Education Supplement : THE

HELP Could Force Graduates to Clear Debt Faster

Article excerpt

Asking graduates to repay their student loans at a faster rate and in full could resolve a "black hole" in the current system, according to University Alliance plans for a "HELP UK" loan system.

The mission group published on 26 June the outline of a Higher Education Loan Programme - a term borrowed from Australia - requiring little or no public subsidy that could grant postgraduates and undergraduates "lifetime loan allocations" to be used for tuition fees or living expenses.

Libby Hackett, University Alliance chief executive, said that the current loans system, under which, it has been estimated, 45 per cent of loan outlay will never be repaid, creates a "black hole in the public finances".

She told a press briefing on 23 June that HELP UK could be rolled out in stages: first to postgraduates; then to undergraduates barred from the current loans system, such as those studying second degrees; and finally to undergraduates who can access funding now.

Repayments would be triggered once a graduate earns £21,000, as under the current system. But rather than the 9 per cent of total income above £21,000 that is now levied, under the alliance's proposals graduates would face monthly repayments of between 4 per cent and 8 per cent of their total earnings. …

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