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Student Finance

Volume 449: debated on Tuesday 25 July 2006

To ask the Secretary of State for Education and Skills how many and what percentage of graduates were paying back income-contingent student loans in each year for which figures are available; and if he will make a statement. (84697)

Borrowers enter repayment status in the April after they leave their course as they are, in principle, eligible to repay their loans. However, borrowers only make repayments when they are earning over £15,000 and those earning less are not required to make any repayments.

The following table shows the number in repayment status and the numbers who made a repayment in each financial year. Full data is not yet available for more recent financial years.

Financial year

2003-04

2002-03

2001-02

2000-01

Total in repayment status

568,500

298,300

100,000

35,500

Total who made a repayment1

270,900

132,600

42,600

14,500

Percentage making a repayment

48

44

43

41

1 Figures include those who made a repayment but who are not in repayment status.

Note:

Numbers are rounded to the nearest 100.

The repayment system is still relatively young. The table shows an increasing proportion repaying each year as older cohorts earn more and pass the threshold. However, full cohorts did not enter repayment until 2002-03 onwards. These larger, new cohorts have a negative impact on the percentage repaying compared to the positive impact of the older, but smaller, cohorts. This ‘drag’ effect will become less evident as more cohorts move into repayment and the system reaches a steady state.