£21,000 salary cap that triggers student loans could be raised
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The salary cap of £21,000 that currently triggers student loan repayments could possibly be raised, as ministers work to make the system fairer.
There is much concern right now over graduates’ ability to pay back student loans. Options are being considered to reduce the pressure of student debt levels. A recent report has shown that graduates are leaving university with tens of thousands of pounds of debt.
One possible option is to increase the threshold by inflation or to match it to average earnings. A second option is to get rid of the 6.1% interest.
In 2012 the agreement was set that graduates would not have to begin paying off their loans until they were making £21,000 per year.
Education secretary Angela Rayner has recently discussed the “debt crisis that we’re foisting on our young people,” according to Telegraph. She continued to say: “They are leaving university with £57,000 worth of debt, it’s completely unsustainable and we’ve got to start tackling that.”