This article is from the source 'bbc' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.

You can find the current article at its original source at http://www.bbc.co.uk/go/rss/int/news/-/news/education-11512257

The article has changed 12 times. There is an RSS feed of changes available.

Version 1 Version 2
Graduates face paying interest on student loans Graduates face paying higher interest on student loans
(about 1 hour later)
The government is considering asking all but the poorest graduates in England to pay a "real" rate of interest on their student loans. The government is considering asking all but the poorest graduates in England to pay a "market" rate of interest on their student loans.
Currently, the loans are charged at what amounts to a zero rate. Currently all graduates pay a low interest rate, linked to the base rate, on their tuition fee and maintenance loans.
However, the earnings threshold at which graduates have to start repaying the money may be raised from the current figure of £15,000. The earnings level at which they start repaying loans may also be raised.
The move comes ahead of a higher education funding review likely to recommend removing the tuition fee cap. An official review of higher education funding is expected to call for the cap on tuition fees to be removed.
The review, by former BP chief Lord Browne, is due to publish its recommendations on Tuesday.The review, by former BP chief Lord Browne, is due to publish its recommendations on Tuesday.
But as all the Liberal Democrat MPs in the coalition have signed a pledge to oppose a rise in fees, ministers have been trying to reach a compromise that will be progressive enough to secure their backing. But as the Liberal Democrats campaigned in the election against fee rises - and all the party's MPs have signed a pledge to oppose them - ministers have been trying to reach a compromise that will be progressive enough to secure their backing.
The two sides have not yet reached a deal. The two sides are thought not to have reached a deal yet.
Ministers have been considering a system of tiered interest rates, tied to graduates' earnings.Ministers have been considering a system of tiered interest rates, tied to graduates' earnings.
This may have meant higher rates for higher-earning graduates.This may have meant higher rates for higher-earning graduates.
But the BBC understands ministers are now moving towards charging most graduates a flat, real rate of interest on their loans, with only graduates on low salaries enjoying a zero rate of interest. But the BBC understands ministers are now moving towards charging most graduates a flat, market rate of interest on their loans, with only graduates on low salaries enjoying the lower rate.
The threshold for paying it back would be raised from the current level of £15,000. The threshold for paying the money back would be raised from the current level of £15,000.
The row over university funding is now not a financial problem for universities but a political problem for the coalition.The row over university funding is now not a financial problem for universities but a political problem for the coalition.
All sides in government accept tuition fees are going to have to go up and graduates will have to pay an awful lot more for their degrees.All sides in government accept tuition fees are going to have to go up and graduates will have to pay an awful lot more for their degrees.
The problem is coming up with a suitably large "progressive" fig leaf to cover Lib Dem embarrassment for promising at the last election to oppose higher fees.The problem is coming up with a suitably large "progressive" fig leaf to cover Lib Dem embarrassment for promising at the last election to oppose higher fees.
So far, despite weeks of haggling and different proposals, it has proved impossible to reach a deal between the two sides.So far, despite weeks of haggling and different proposals, it has proved impossible to reach a deal between the two sides.
However the favoured idea now is to charge all but the poorest graduates a real rate of interest on their student loans.However the favoured idea now is to charge all but the poorest graduates a real rate of interest on their student loans.
As one government source put put it: "Our aim is to help the least well off... not to clobber the better off."As one government source put put it: "Our aim is to help the least well off... not to clobber the better off."
Will that be sufficient to get the Lib Dems on board? Probably not. So stand by for more arguing and leaks over university funding.Will that be sufficient to get the Lib Dems on board? Probably not. So stand by for more arguing and leaks over university funding.
There would also be pressure on universities to provide more bursaries.There would also be pressure on universities to provide more bursaries.
One government source said: "Our aim is to help the least well off, not to clobber the better off."One government source said: "Our aim is to help the least well off, not to clobber the better off."
Liberal Democrat MP Stephen Williams told the BBC's Today programme that he was waiting for the outcome of talks between Lib Dem Business Secretary Vince Cable and Universities Minister David Willetts, a Conservative, before commenting on whether the proposal would appease party members. Former Liberal Democrat Universities spokesman Stephen Williams said his party's MPs had not necessarily moved away from their pre-election promises.
He said the Liberal Democrats had "not necessarily" moved away from their pre-election pledge, and there was concern in the party about a market-based system developing, where different universities were able to charge different fees. But he told the BBC's Today programme that he was waiting for the outcome of talks between Lib Dem Business Secretary Vince Cable and Conservative universities minister David Willetts, before commenting on whether the proposal would appease party members.
He said that risked skewing choices made by young people. He said there was concern in the party about a market-based system developing, where different universities were able to charge different fees.
That risked skewing choices made by young people, he added.
"I'm really worried and I know a lot of my colleagues are worried that we may end up with a regime that makes people take choices they're not necessarily academically suited for.""I'm really worried and I know a lot of my colleagues are worried that we may end up with a regime that makes people take choices they're not necessarily academically suited for."
Lord Browne's review is expected to recommend scrapping the upper limit on tuition fees in England.Lord Browne's review is expected to recommend scrapping the upper limit on tuition fees in England.
But government support would only be guaranteed up to £7,000 per year - which is likely to make this the upper fee for most degree courses. But under what is being termed a "soft cap" institutions that raise their fees above £7,000 per year would have to take on the risk of requiring that extra payment.
This would mean more than doubling the current tuition fee of £3,290. This has led to speculation that £7,000 will be the upper fee for most degree courses.
This would mean more than doubling the current tuition fee of £3,290. And if the major cuts expected in the comprehensive spending review go ahead - it could mean few extra resources for a struggling university sector.
Backbench Lib Dem MP Greg Mulholland warned over the weekend that he and others would oppose any attempt to raise fees.Backbench Lib Dem MP Greg Mulholland warned over the weekend that he and others would oppose any attempt to raise fees.
"Many of us, certainly in the Liberal Democrats and I suspect probably across the House to some extent... will oppose any attempt to raise fees in the way that has been leaked from the Browne report.""Many of us, certainly in the Liberal Democrats and I suspect probably across the House to some extent... will oppose any attempt to raise fees in the way that has been leaked from the Browne report."