STORY
The Treasury Committee has said the Government has a moral obligation to reverse its decision to freeze the earnings threshold at which graduates begin repaying student loans. MPs warned that keeping the threshold unchanged would increase repayments for many borrowers as wages rise, with younger workers bearing a growing share of the fiscal burden.
The committee said the policy amounted to a real-terms reduction in the repayment threshold and would affect people who had arranged their finances on the basis of previous terms. It argued that changes to student finance should be transparent and should not impose unexpected costs on graduates without proper parliamentary scrutiny.
The Government has defended the freeze as part of efforts to maintain the sustainability of the student finance system and control public spending. The committee called for Ministers to reconsider the decision and provide a clearer assessment of its impact on household incomes, different graduate groups and the wider labour market.