Your support helps us to tell the story
From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.
At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.
The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.
Your support makes all the difference.The government is to hike student loan repayments by around £150 a year in real terms, by freezing the repayment salary threshold.
The announcement means graduates with student loans will see more cash taken out of their payslips every month – on top of other planned tax and bill rises.
Michelle Donelan, the higher education minister, said the change would make sure the university funding system was providing “value for money for all of society at a time of rising costs”.
The announcement was made in a written statement slipped out to parliament on Friday after MPs had gone home from Westminster to their constituencies.
The practice is common for government announcements where ministers want to avoid parliamentary scrutiny.
Under the changes the repayment threshold for plan 2 students will be frozen at the previous 2021-22 level of £27,295 per year, £2,274 a month, or £524 a week.
For plan 3 students the threshold will also be unchanged at £21,000 per year, £1,750 a month or £404 a week for financial year 2022-23.
The thresholds freeze sits against annual inflation soaring to 5.4 per cent in December.
Paul Johnson, the director of the Institute for Fiscal Studies (IFS) think tank, said the policy announcement amounted to a “6 or 7 per cent real terms reduction and hence a real terms increase in repayments of circa £150 a year on graduates with student loans”.
The freeze will hit around the same time as the government is planning to hike national insurance contributions (NICs) and raise rail fares by record levels – the latter linked to inflation.
It will also follow a controversial cut to universal credit (UC) and skyrocketing winter heating and energy bills.
Announcing the change in the written statement, Ms Donelan said: “Maintaining the repayment threshold at its current level, alongside the ongoing freeze in fees, will help to ensure the sustainability of the student loan system, while keeping higher education open to everyone who has the ability and the ambition to benefit from it, including the most disadvantaged.”
Subscribe to Independent Premium to bookmark this article
Want to bookmark your favourite articles and stories to read or reference later? Start your Independent Premium subscription today.
Join our commenting forum
Join thought-provoking conversations, follow other Independent readers and see their replies
Comments