Urgent! Help fight the Government’s student loan U-turn that means many will pay more

The Government is consulting on a retrospective change to student loans in England that could mean many who took them since 2012 will have to shell out more.

I first wrote on this in January in my A threat to the Government, don’t U-turn on student loans blog post. That partially succeeded, as at least the Government agreed to consult on the change rather than just do it. Yet now…


Below, I’ve drafted a free email and letter template to help you do this. This approach worked very well in the campaign to get financial education on the national curriculum, as when real people (not political activists who do it all the time) write to MPs, they sit up and take notice.

First though a bit more detail…

What’s the problem?

Student loans are designed to be repaid once you leave university. You pay 9% of everything earned above £21,000 a year. When the 2012 system was launched, the Government said that from April 2017, the £21,000 figure would be uprated (ie, increased) each year in line with average earnings. But now it wants to freeze it at £21,000 instead.

This means graduates would end up paying more each month than the Government promised and publicised when they took out the loan. Eg, if you earn £25,000 and the threshold is £23,000, you repay £180 a year. If the threshold is frozen at £21,000, you pay £360 a year. For a full explanation see my Don’t U-turn blog post.

This type of change is a disgrace and goes against all the rules of good governance in all areas, which frown on retrospective changes. No commercial company would be allowed to change its terms after the event like this – it’d be slapped by the regulator.

What am I going to do about it?

I have pledged to fight this, as it is an outrage, partly too as I communicated this to people in good faith in my role as head of the Independent Taskforce on Student Finance Information. As part of this, alongside MoneySavingExpert.com, today I’m submitting a detailed response to the Government’s consultation.

What you can do?

Assuming you agree – whether you’re directly affected or not, please ensure your voice is heard. We want MPs to know they cannot retrospectively change the terms. Doing so not only hurts those directly affected, it kills faith in the entire system.

How would anyone be able to trust the student finance set up again if future Governments can change it with hindsight?

What to do…

If you want to read the Government’s consultation and do your own response, you can until 14 October, and that’d be great. However, an easier option is to put pressure on the Government by writing to your MP. Plus, please spread the word on social media. Here’s how…

  • Go to Parliament.uk. Enter your postcode into Parliament.uk or click the link to your MP’s name and check for an email address.
  • Email them a message. Here’s a template for inspiration. You can copy and paste it, or even better, please personalise it with your views and experience. Are you a parent of a post-2012 student? Are you at university now? Tell your MP why this matters to you.

Template statement to get you started

As your constituent, I’m writing to ask you to urgently tell the Government to abandon its dangerous plans to retrospectively change the student loan system, and to join the campaign against this proposal.

The Government wants to freeze the repayment threshold at £21,000 – even though students were told they would be uprated with average earnings from April 2017. This means students who started university since 2012 will pay more back than they’d legitimately planned on. Effectively, their loans will have their T&Cs written after they’ve taken them out.

This is outrageous, it is unfair, and it should not be allowed to happen. Not only will it be against natural justice for all who have these loans, it will kill faith in the system for a whole generation of new students. How can you make a decision on whether university is worth it, if a future government will pull the rug from under your feet?

As my MP, I am calling on you to join the campaign to #StopStudentLoanUTurn. The Government must change its mind.

Yours sincerely, ENTER YOUR NAME HERE

    If you’re having trouble copying the above text try this Microsoft Word version instead.

    Please tell us when you get a response. We’d love to know if your MP gets back to you – please forward any reply you get to studentfinance@moneysavingexpert.com

    If you’re told to contact the consultation directly. We’ve heard that many people are being told by their MPs that they should respond to the consultation directly themselves. If this is what you’ve been told, and you’d like to do it, you can email them directly at studentloanconsultation@bis.gsi.gov.uk