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Student Loans

Volume 400: debated on Monday 24 February 2003

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To ask the Secretary of State for Education and Skills what his estimate is of the annual cost of the collection of student loan repayments; what sum is paid by his Department to the Inland Revenue for this work; and if he will make a statement. [95379]

[holding answer 3 February 2003]: There are two types of student loan. Borrowers under the pre-1998–99 scheme of mortgage style loans repay their loans direct to the Student Loans Company (SLC). Most borrowers under the current income-contingent loans scheme repay their loans through the tax system.The SLC will spend around £12 million in the 2002–03 financial year on collecting repayments on mortgage style student loans not sold to the private sector, and on those income-contingent loans not collected by the Inland Revenue—voluntary repayments and repayments from borrowers outside the UK. The Inland Revenue is expected to charge around £1.9 million for collecting income-contingent loan repayments through the tax system in 2002–03. These costs are shared between England and Wales, Scotland and Northern Ireland.