The New Student Loan Repayment Threshold is an Insult to Students

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Growing up, money was always an area of concern, we’d fish around for enough coins to cover our morning bus fare and every year pray that the car would make it through the winter without needing work. So, when I started at university, it was an entirely new and exciting experience. Coming from a low-income background entitled me to the highest student loan, alongside a means-tested bursary from my uni. It was the first time in my life I was able to indulge in the feeling of financial independence. And yet, despite the freedom that my changed circumstances afforded me, it was an undeniably bittersweet feeling as the knowledge of my eventual student loan repayments loomed over me.  

Home to the third-highest intake of public-school students, my former university and the students attending it often functioned as a reminder of the transience of my financial situation. Many of my peers were from wealthy enough backgrounds to need only the minimum student loan, if at all, as the majority were provided for by their parents and family. Despite their evident and enviable financial security, I was never bitter towards those wealthier than me – how could I blame families for wanting to provide for their children if they had the means to?

At times, I found myself somewhat irritated by those who dismissed my concerns about student loans repayments but always took solace in the safety net provided by the salary threshold. This ensured I would have time to find my footing after graduation, as I wouldn’t need to begin paying back the loans until I earned at least £27,295 and after 30 years, the loans would be written off altogether. 

However, despite this safety net, the government reminded us once again that their priorities lie with the most elite in society; when I caught wind of the government’s proposal to lower the salary threshold and extend the repayment period for student loans, as a recent graduate myself I became anxious and angry. If implemented, the proposal would see the salary threshold lowered to £23,000 – although £20,000 was also considered – and the repayment period would be extended by an additional ten years. The suggestion was supposedly made in an effort to ensure that graduates are paying their fair share of the cost of their education, but in typical Tory manner, their proposal forgoes the reality of many graduates’ financial struggles.  

Such a move contributes to the already widening gap between the rich and poor in the UK, as this proposal coincides with the government’s recent increase in national insurance, according to the Financial Times, this means “a graduate earning the current threshold would have their take-home pay cut by more than £800 annually”. And not only is it certain to affect low-earning graduates, but it’s also a move that will undoubtedly discourage prospective students from low-income backgrounds from pursuing a university education. 

With the salary threshold currently at £27,295, although still lower than the average employee salary in the UK, it enables graduates to afford the cost of living, occasional luxuries, and also monthly student loan repayments. However, this proposed change to the threshold propagates a longstanding tendency in the Conservative party to protect the wealthiest and attack the most vulnerable in their budget cuts.

The lowering of this repayment threshold functions as yet another move that absolves the wealthiest of accountability and targets those already struggling. They claim this move will make them just under £2 billion a year, but when it comes to figures like the £35 billion lost to blatant tax non-payment, avoidance, and fraud in 2020, little is done to address the matter. The revelations of the recent pandora papers only further the reality of politicians’ self-serving double standards, as it reveals the number of politicians who avoid tax themselves. 

The Tory government has outdated beliefs about the world of work and prejudiced opinions about what careers are considered valuable. They maintain the capitalist ideology that if you work hard, then you will reap the benefits, an ideology that is convenient for the minority to maintain; those born into generational wealth and those who don’t face the same barriers of discrimination as others. Such a mentality refuses to acknowledge how often luck plays a role in our fate and unfairly penalizes those working jobs deemed as ‘lesser’, even when those people are working the same number of hours as those in different, better-paid professions. Determining the essentiality of a job is entirely subjective, and in my conviction, the notion of “essentiality” is in fact a word largely used to disguise the inherently discriminatory works of a classist government.

A government that takes advantage of the most vulnerable and defends the richest 1% only exposes their inability to uphold democratic values and to genuinely act as public servants to their country, rather than to themselves. They owe it to those already financially struggling in society to reconsider their plans to change the terms of student loan repayments. It’s time to start holding the wealthiest to account and stop using those from low-income backgrounds as a scapegoat. 

Words by Jenny Medlicott

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