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| Student loan repayment threshold rises | Student loan repayment threshold rises |
| (about 5 hours later) | |
| Former students will be able to earn more before they have to start paying back their tuition fee loans. | Former students will be able to earn more before they have to start paying back their tuition fee loans. |
| English and Welsh students who took out loans from September 2012 onwards - when fees in England rose to up to £9,000 a year - will now start to pay back when they earn £25,000 a year instead of £21,000. | English and Welsh students who took out loans from September 2012 onwards - when fees in England rose to up to £9,000 a year - will now start to pay back when they earn £25,000 a year instead of £21,000. |
| The government says the move could save graduates up to £360 a year. | The government says the move could save graduates up to £360 a year. |
| The National Union of Students said the change was "welcome relief" for many. | The National Union of Students said the change was "welcome relief" for many. |
| Who will benefit? | Who will benefit? |
| The Department for Education says some 600,000 graduates will benefit over the next financial year alone. | The Department for Education says some 600,000 graduates will benefit over the next financial year alone. |
| Previously, the repayment threshold for post-September 2012 loans had been frozen at £21,000 until 2020-21, but last autumn Prime Minister Theresa May announced a rise in the threshold from this new financial year. | |
| The change will also lower the repayments of those earning over £25,000, as the percentage of salary paid back will be on a smaller amount. | The change will also lower the repayments of those earning over £25,000, as the percentage of salary paid back will be on a smaller amount. |
| Research carried out by the Institute for Fiscal Studies found raising the repayment threshold to £25,000 benefits middle-earning graduates the most, saving them up to £15,700 in repayments over their lifetimes. | Research carried out by the Institute for Fiscal Studies found raising the repayment threshold to £25,000 benefits middle-earning graduates the most, saving them up to £15,700 in repayments over their lifetimes. |
| Lower-earning graduates, who are likely to earn below the threshold for a significant part of their career, will see a smaller reduction in lifetime repayments, the IFS calculates. | Lower-earning graduates, who are likely to earn below the threshold for a significant part of their career, will see a smaller reduction in lifetime repayments, the IFS calculates. |
| While high-earning graduates - who would repay their loans in full - will see a reduction in yearly repayments, this will merely extend the period of time for which they have to repay and so will make little difference to their lifetime repayments. | While high-earning graduates - who would repay their loans in full - will see a reduction in yearly repayments, this will merely extend the period of time for which they have to repay and so will make little difference to their lifetime repayments. |
| IFS economist Laura van der Erve said: "Overall, repayments will fall by around £10,000 for the average graduate as a result of the threshold increase. | IFS economist Laura van der Erve said: "Overall, repayments will fall by around £10,000 for the average graduate as a result of the threshold increase. |
| "This will significantly increase the long-run cost to the government of providing higher education. The long-run cost to the government will increase by more than £2bn a year, an increase of nearly 40%." | "This will significantly increase the long-run cost to the government of providing higher education. The long-run cost to the government will increase by more than £2bn a year, an increase of nearly 40%." |
| Do I need to do anything? | Do I need to do anything? |
| No. Graduates living in the UK will not have to do anything to receive the saving. | No. Graduates living in the UK will not have to do anything to receive the saving. |
| Repayments will be calculated automatically by employers for those paid on a PAYE (pay-as-you-earn) basis or as part of the self-assessment return to HM Revenue and Customs. | Repayments will be calculated automatically by employers for those paid on a PAYE (pay-as-you-earn) basis or as part of the self-assessment return to HM Revenue and Customs. |
| I have a pre-2012 loan. Is there any change for me? | I have a pre-2012 loan. Is there any change for me? |
| Yes, although the benefits are not quite so significant. | Yes, although the benefits are not quite so significant. |
| For English and Welsh students who took out loans before 2012, as well as students from Scotland and Northern Ireland, the threshold rises each year in line with inflation. | For English and Welsh students who took out loans before 2012, as well as students from Scotland and Northern Ireland, the threshold rises each year in line with inflation. |
| This year the repayment threshold will rise to £18,330 - up from £17,775 - in line with inflation at 3.1%. | This year the repayment threshold will rise to £18,330 - up from £17,775 - in line with inflation at 3.1%. |
| What does the National Union of Students say about the post-2012 change? | What does the National Union of Students say about the post-2012 change? |
| NUS vice-president for higher education Amatey Doku said: "This change will be a welcome relief for many of the lowest-earning graduates. | NUS vice-president for higher education Amatey Doku said: "This change will be a welcome relief for many of the lowest-earning graduates. |
| "In recent years the expected repayment for the lowest-earning graduates has increased by 30%, thanks to the freezing of the cap at £21,000 instead of rising slightly each year. | "In recent years the expected repayment for the lowest-earning graduates has increased by 30%, thanks to the freezing of the cap at £21,000 instead of rising slightly each year. |
| "However in making this change, the government has at least acknowledged that there are serious flaws in how we fund higher education in this country. | "However in making this change, the government has at least acknowledged that there are serious flaws in how we fund higher education in this country. |
| "I hope that this will not preclude a more in-depth consideration as part of the upcoming review into post-18 funding, lest this becomes patching up the holes on a sinking ship". | "I hope that this will not preclude a more in-depth consideration as part of the upcoming review into post-18 funding, lest this becomes patching up the holes on a sinking ship". |
| But Mr Doku said the change for tuition fee loans did not address the issue of living costs. | But Mr Doku said the change for tuition fee loans did not address the issue of living costs. |
| "This will not change the fact that our maintenance model is fundamentally regressive - students from the lowest income families accrue £57,000 of debt, compared to £42,000 for their more privileged peers." | "This will not change the fact that our maintenance model is fundamentally regressive - students from the lowest income families accrue £57,000 of debt, compared to £42,000 for their more privileged peers." |
| What does the government say? | What does the government say? |
| Universities Minister Sam Gyimah says the rise in the post-2012 student repayment threshold is a "key milestone" and shows the government is trying to support those in higher education. | Universities Minister Sam Gyimah says the rise in the post-2012 student repayment threshold is a "key milestone" and shows the government is trying to support those in higher education. |
| "We are seeing more 18-year-olds than ever before attend university, including the highest ever number from disadvantaged backgrounds and we want to give these students a fair deal, both during their studies and afterwards too. | "We are seeing more 18-year-olds than ever before attend university, including the highest ever number from disadvantaged backgrounds and we want to give these students a fair deal, both during their studies and afterwards too. |
| "Not only will it benefit hundreds of thousands of graduates in the next financial year alone, but millions in the years to come." | "Not only will it benefit hundreds of thousands of graduates in the next financial year alone, but millions in the years to come." |
| What is the background to this? | What is the background to this? |
| Mrs May announced the tuition fee loan repayment threshold increase on 1 October last year, four months after failing to keep her majority in the general election. | Mrs May announced the tuition fee loan repayment threshold increase on 1 October last year, four months after failing to keep her majority in the general election. |
| At the same time, she said she had listened to voters and the fees themselves would be frozen at £9,250 a year in England, after a series of rises by universities. | At the same time, she said she had listened to voters and the fees themselves would be frozen at £9,250 a year in England, after a series of rises by universities. |
| In February, Mrs May launched a review of tuition fees and university funding, saying students in England faced "one of the most expensive systems of university tuition in the world". | In February, Mrs May launched a review of tuition fees and university funding, saying students in England faced "one of the most expensive systems of university tuition in the world". |
| The year-long review will be chaired by the author and financier, Philip Augar. | The year-long review will be chaired by the author and financier, Philip Augar. |