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Students: Loans

Volume 474: debated on Tuesday 1 April 2008

To ask the Secretary of State for Innovation, Universities and Skills how many people with student loans who graduated in (a) 2001, (b) 2002, (c) 2003, (d) 2004, (e) 2005, (f) 2006 and (g) 2007 have yet to make any repayments of a student loan. (188039)

Available data are shown in the following table.

English domiciled borrowers who have not yet made repayments on their student loans by loan type1

Cohort (repayment start)2

Mortgage-style loan

Income-contingent loan3

All loans4

April 2002

9,900

33,900

43,800

April 2003

3,100

56,300

59,400

April 2004

800

71,600

72,400

April 2005

200

103,800

104,000

April 2006

100

146,700

146,800

April 20075

100

n/a

n/a

n/a = Not available.

1 Figures are rounded to the nearest 100. Publicly-owned student loans.

2 Repayment begins from the April following the year of graduation, when income reaches the threshold.

3 Annual repayment information is passed to the SLC after the end of the tax year, to update borrowers’ records. Some of the borrowers covered in the table will have made repayments via their employers recently that have not yet been reflected in their SLC accounts, and therefore appear not to have made repayments.

4 Borrowers with both types of loan may be counted twice.

5 Details of income-contingent loan repayments collected through the tax system are passed to the SLC after the end of the financial year to update borrowers’ accounts. Therefore data are not yet available on repayments by 2006 graduates who became liable to begin repaying in the tax year 2007-08.

Source:

Student Loans Company (SLC)

Borrowers who graduated in 2007 are not required to begin repaying their student loans until April 2008. Income-contingent loans replaced mortgage-style loans from 1998; the table reflects this change. It also shows that many people who have recently left university have not yet begun to repay, but those in older cohorts are now repaying.

Borrowers with up to four mortgage-style loans repay over five years when their income exceeds the repayment threshold; those with five or more loans repay over seven years. The threshold for borrowers with mortgage-style loans is 85 per cent. of national average earnings, currently £25,287 from 1 September 2007. Borrowers are able to apply for deferment of repayments if their income is below this.

Borrowers with income contingent loans repay at a rate of 9 per cent. of earnings above £15,000 a year. Repayments are usually collected through the tax system by employers, in the same way as income tax and national insurance contributions. Self employed borrowers make repayments through the self assessment system.

To ask the Secretary of State for Innovation, Universities and Skills (1) how many full-time undergraduates qualified for 75 per cent. net income assessed loans of (a) £2,685, (living at home), (b) £3,470, (living away from home outside London) and (c) £4,855, (living away from home in London), in the latest period for which figures are available; (194197)

(2) how many full-time undergraduates qualified for maximum student loans of (a) £3,580, (living at home), (b) £4,625, (living away from home outside London) and (c) £6,475, (living away from home in London), in the latest period for which figures are available;

(3) how many full-time undergraduates qualified for 25 per cent. income assessed loans of (a) £895, (living at home), (b) £1,155, (living away from home outside London) and (c) £1,620, (living away from home in London), in the latest period for which figures are available.

Student maintenance loans consist of up to three elements: a non-means tested loan of around 75 per cent. of the maximum; a means tested loan for around 25 per cent. of the maximum; and an additional income-assessed amount for extra weeks if the course is longer than normal. The level of loan available is reduced for final year students. Students can choose to borrow less than their full entitlement.

Available data are shown in the following tables.

English domiciled students receiving non-means tested maintenance loans by entitlement category, year and loan rate1, academic year 2006/07

Entitlement category—Living at:

Full year or final year

Students receiving loan at maximum rate

Students receiving loan below maximum rate

Home

Full

90,700

6,200

Final

39,800

1,700

London

Full

51,900

3,700

Final

19,900

2,100

Elsewhere

Full

305,200

23,400

Final

123,500

11,100

1 Table excludes students who move between entitlement categories during the year (e.g. Home and Elsewhere). Figures are rounded to the nearest 100. Source: Student Loans Company.

English domiciled students receiving means tested maintenance loans by entitlement category, year and loan rate1, academic year 2006/07

Entitlement category—Living at:

Full year or final year

Students receiving loan at maximum rate

Students receiving loan below maximum rate

Home

Full

69,800

1,400

Final

29,900

200

London

Full

36,100

600

Final

14,000

200

Elsewhere

Full

186,400

3,200

Final

76,200

500

1 Table excludes students who move between entitlement categories during the year (e.g. Home and Elsewhere). Figures are rounded to the nearest 100. Source: Student Loans Company.

English domiciled students receiving maintenance loans including extra weeks allowances by entitlement category, year and loan rate1, academic year 2006/07

Entitlement category— Living at:

Full year or final year

Students receiving loan above maximum rate (due to extra weeks)

Students receiving loan at maximum rate

Students receiving loan below maximum rate

Home

Full

45,000

24,900

27,000

Final

19,900

10,100

11,500

London

Full

25,600

10,600

19,400

Final

10,100

3,900

8,000

Elsewhere

Full

82,200

104,500

141,900

Final

36,300

40,000

58,300

1 Table relates to total maintenance loans including non-means tested loans, means tested loans and extra weeks allowances. Excludes students who move between entitlement categories during the year (e.g. Home and Elsewhere). Figures are rounded to the nearest 100. Source: Student Loans Company.