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Are student loans a feasible way of funding education? (poll)

By Staf Newsletter  |  Posted: April 10, 2014

Graduates at Staffordshire University

Graduates at Staffordshire University.

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New research by the Sutton Trust has shown that 73% will not pay back their student loans until they are in their 40s and 50s.

Tuition fees rose to £9,000 a year in 2012, trebling the maximum of £3,000 instated from 1998-2011. The income threshold for paying this back has risen with the fees, from £16,190 to £21,000.

With it, the interest rate has gone up to an above-inflation rate of 3%, and it has been estimated that students under this new system will be leaving university with £20,000 more debt. The average graduate debt is now estimated to stand at £44,000.

The old system would wipe out any remaining debt after 25 years, and this has now been increased to 30 years. But it is still expected that many students will not pay back their loans and so much debt will eventually be written off.

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However, the research did also suggest that there has been an increase in students from less privileged backgrounds gaining university places.

There have long been concerns about the fiscal implications of charging students tuition fees – and the recent rise has prompted student protests across the country. Now that it is estimated that only 5% will pay off their debts by the time they are 40 – compared with half under the old system, they have come under even harder scrutiny.

What are your thoughts? Do you think this is a feasible way of funding education? Let us know by voting in the poll below:

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  • TommytheBrit  |  April 10 2014, 10:27PM

    Does this really come as any surprise whatsoever? The tuition fee system was broken before the Browne Review, and those in the NUS at the time warned heavily against any increase in fees for the simple reason that the government couldn't afford to lose any more money out of each £1 it loaned out. Whoops. We're now at the point where it would have been cheaper, overall, for the gov't to have left fees as they were. Let's stop dancing around the issue; let's look at a real alternative such as a graduate tax (like this one: null) and have a proper conversation about how to fund higher education in the UK.

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