New teachers to get loans paid off under the Tories

The best maths and science graduates will have their student loans repaid by the government if they decide to teach, the Conservatives pledged yesterday. Those with a 2:1 degree pass or better will be entitled to claim repayments for as long as they stay in the classroom. The scheme, based on a US initiative announced by President Barack Obama, will cover graduates in science, maths and engineering – so-called "Stem" subjects considered vital to the future of the economy.

The move is designed to ensure that more high-quality graduates turn to teaching, something which happens in countries such as Finland and Singapore which then perform well in international education league tables. It will be limited to those who have studied at up to three dozen of the country's most prestigious universities such as Oxford or Cambridge – in an attempt to lure ambitious students into teaching.

"If they leave teaching they will have to take up the repayments," Michael Gove, the Conservatives' schools spokesman, said in a speech to the Sir John Cass Foundation in London last night. "This is a major financial incentive, amounting to about £40,000 over the lifetime of the loan, and therefore is a significant investment by the taxpayer, but one I think that is justified."

Mr Gove added that as a result of the plan, "we will have better-educated people going into teaching". The offer is open to would-be primary and secondary school teachers. The scheme will be paid for by reducing funding for the Training and Development Agency (TDA), which is responsible for recruitment to the professions and financing teacher training courses. The Tories want to see a shift towards more teachers being trained on the job.

Both maths and science have traditionally suffered from teacher shortages, with staff untrained in the subjects taking lessons in many secondary schools. This year, however, the TDA has recruited above its targets for the two subjects for the first time, largely as a result of older recruits having to switch careers because of the recession.

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