‘Doomed’ student loan system could be replaced by graduate tax, says ex-watchdog
Replace ‘tough’ student loans with new tax, expert says
- The English student loan system is deemed "doomed" by John Blake, former director of the Office for Students, who suggests a graduate tax could replace it.
- Chancellor Rachel Reeves is facing increasing calls for reform of student loans, despite her defence of the current system, as graduates struggle with mounting debts.
- Graduates on "Plan 2" loans, particularly those from 2012-2023, are experiencing their debt grow due to high interest rates and frozen repayment thresholds, despite making regular payments.
- Critics, including Martin Lewis of MoneySavingExpert and the National Union of Students, argue the system is fundamentally broken and causes significant financial hardship and feelings of unfairness.
- Health Secretary Wes Streeting has also acknowledged the need for a national debate on student finance, stating the current system feels "quite tough" for young graduates.
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