STORY
The Treasury Committee has said the Government has a moral obligation to reverse the freeze in the student loan repayment threshold. MPs warned that holding the threshold at its current level would increase repayments for graduates whose wages had risen only because of inflation.
The committee said the decision risked undermining trust in the student finance system because borrowers had made decisions based on an expectation that repayment terms would operate consistently. It argued that retrospective changes could place a disproportionate burden on lower and middle earners.
The Government has defended the need to keep the system financially sustainable, but the committee urged Ministers to reconsider the policy. Its report called for greater transparency about future changes and a clearer assessment of the effect on graduate incomes.