University Funding Review

The government has launched a sweeping review of higher education in England, pledging to make student finance “fairer”.

What will the review look at?
It will assess all aspects of the system, including the cost of tuition, currently capped at £9,250 a year. Student loan rates — up to 6.1% — will also be examined. The year-long review will be led by Philip Augar, a former financier and an author.

Why is this happening?
Students and parents are unhappy about the spiraling cost of getting a degree. Theresa May has acknowledged that students in England face “one of the most expensive systems of university tuition in the world”. Maintenance grants for poorer students were scrapped in 2016.

Will tuition fees be scrapped?
We will have to wait for the results of the review but, either way, any changes are unlikely to affect those already at university. Labour has pledged to abolish tuition fees and bring back maintenance grants, but the Tories say this would push up taxes and force a cut in the number of university places.

It is not always a good idea to pay off a chunk of your loan, even if you can afford to, according to some Consumer finance commentators.

Repayments do not start until a graduate’s earnings reach a set amount. This threshold is expected to increase from £21,000 a year to £25,000 in April, for those who took out their loans on or after September 1, 2012.

Any outstanding loan is written off after 30 years, so if you do not expect to be a high earner it may be better to put any spare money into a savings account instead.

Julian Kaye Dip PFS

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