University applicants in England are set to receive clearer information regarding student loans before they commit to them, the government has stated. Ministers have confirmed they will explicitly communicate that governments can alter repayment rules and that various career paths can influence how much borrowers ultimately repay.
This decision follows an inquiry by MPs into student loans, which found that the way loans were presented to teenagers amounted to mis-selling. The Department for Education (DfE) had previously compared repayments to £30-a-month phone contracts.
The government agreed to some recommendations from the inquiry, including making it more prominent that regulations may be amended. It also stated that more could be done to help borrowers understand how their loan balance might change over the long term. However, it rejected calls to reverse a freeze to the repayment threshold for some graduates, split university costs evenly, or stop using the Retail Prices Index (RPI) for interest rates.
Instead of providing long-term repayment predictions, which it deemed potentially misleading due to limited accuracy, the government proposed demonstrating how different life and career choices, such as salary progression, retraining, part-time work, and career breaks, may affect repayment trajectories.