“It’s becoming a symbol of how governments have neglected younger voters,” said Isobel, a 32-year-old policy worker living in Cambridge who the Guardian spoke to about the growing anger over student loan repayments.
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It’s a prevalent feeling at the moment, as graduates on plan 2 student loans begin to clock that they are handing over money from their salary every month to repay their loan but are seeing the sum they owe getting bigger.
The reason for that is that their repayments are dwarfed by the interest that is added on to their debt every month.
According to a report by Euronews, England recorded the highest average debt on graduation compared to other European countries.
Those of us who went to university in England between September 2012 and July 2023 – and students from Wales who have started since September 2012 – pay interest of RPI plus up to 3%. RPI – the retail prices index – is a measure of inflation that can vary each month: in August 2024 it hit 8%. It’s a relatively discredited measure that the government is moving away from using as it can fluctuate wildly and tends to run higher than other inflation figures.
“You’re not told this, you’re given absolutely no information,” says Bryony, a producer working at the Guardian who graduated in 2018. She points out how unfair the system is for those from lower-income families who have to take out the highest level of loan. “I wasn’t told how much interest I was getting charged. I haven’t been told how much money I owe. It’s just completely unfair. The system is basically acting like a loan shark.”
So with tensions rising after the chancellor, Rachel Reeves, announced a freezing of student loan repayment thresholds, meaning that people on lower salaries will have to start repaying earlier, @neelamtailor – who presents the Guardian series It’s Complicated – decided to look into why exactly student loan numbers keep ballooning and what needs to change.
What do you think: are people on plan 2 loans getting unnecessarily screwed over?
To find out more about why the student loans row is escalating and what it means for you, read our deputy money editor Rupert Jones’ explainer ► https://www.theguardian.com/money/2026/feb/24/why-the-student-loans-row-is-escalating-and-what-it-means-for-graduates
#studentloans #loans #university #studentdebt #rachelreeves
