Question to the Department for Work and Pensions:

To ask the Secretary of State for Work and Pensions, what assessment he has made of the potential impact of Plan 2 student loan repayments on pension auto-enrolment contribution adequacy for borrowers earning between (a) £27,295 and £50,270, (b) £50,270 and £60,000 and (c) £60,000 and £80,000; and whether his Department has modelled the impact of reduced pension contributions during years in which student loan repayments are also being made on long-term retirement savings.

Answered by Torsten Bell - Parliamentary Secretary (HM Treasury)

Workplace pension participation remains high among all eligible age groups, with 82% of all employees participating in workplace pensions in 2024.

The Government remains committed to building on the success of automatic enrolment to ensure that people are saving enough for retirement. That is why we have revived the Pensions Commission which will look at the adequacy, fairness and sustainability of the pensions system for future cohorts of retirees.

Question to the Department for Education:

To ask the Secretary of State for Education, a) what is the current RAB charge for Plan 2 loans, and b) how has this changed year-on-year since 2019.

Answered by Josh MacAlister - Parliamentary Under-Secretary (Department for Education)

The current Resource Accounting and Budgeting (RAB) charge for Plan 2 loans in England is 32.2%. The RAB charge for Plan 2 loans has changed as follows since 2019:

Many factors can influence the RAB charge, including modelling methodology, economic determinants and policy decisions. The last cohort of Plan 2 loan borrowers took their first loans in the 2022/23 academic year, the latest RAB charge covers outlay for borrowers still receiving Plan 2 loans in the 2024/25 financial year.

Question to the Department for Education:

To ask the Secretary of State for Education, what estimate her Department has made of the proportion of Plan 2 borrowers graduating between 2016 and 2023 whose total lifetime student loan repayments, including interest, are projected to exceed the net present value of the graduate earnings premium attributable to their degree.

Answered by Josh MacAlister - Parliamentary Under-Secretary (Department for Education)

The department does not hold estimates of lifetime repayment costs for Plan 2 borrowers by earnings bands.

The Autumn Budget included freezes to Plan 2 repayment and interest thresholds for at their 2026/27 financial year level until April 2030, when they will increase annually by inflation.

The following analysis of the impact of freezing the repayment and interest thresholds to aid the decision:

We also do not hold the proportion of borrowers projected to repay of their student loan than the graduate earnings premium attributable to their degree.

Question to the Department for Education:

To ask the Secretary of State for Education, what the estimated total additional lifetime repayment cost of the Plan 2 threshold freeze announced in Autumn Budget 2025 is for borrowers earning at (a) £30,000, (b) £40,000, (c) £50,000, (d) £60,000, (e) £66,000, (f) £75,000 and (g) £90,000.

Answered by Josh MacAlister - Parliamentary Under-Secretary (Department for Education)

The department does not hold estimates of lifetime repayment costs for Plan 2 borrowers by earnings bands.

The Autumn Budget included freezes to Plan 2 repayment and interest thresholds for at their 2026/27 financial year level until April 2030, when they will increase annually by inflation.

The following analysis of the impact of freezing the repayment and interest thresholds to aid the decision:

We also do not hold the proportion of borrowers projected to repay of their student loan than the graduate earnings premium attributable to their degree.

Question to the Department for Education:

To ask the Secretary of State for Education, what assessment she has made of the potential impact of effective marginal deduction rates exceeding 50 per cent on Plan 2 student loan borrowers’ labour supply, including decisions on a) overtime, b) hours worked and c) promotions.

Answered by Josh MacAlister - Parliamentary Under-Secretary (Department for Education)

Plan 2 loans were designed and implemented by the previous government and, given the inherited fiscal situation, the department is making tough but necessary decisions.

Graduates only begin repaying their student loan once earnings exceed the earnings threshold, after which they pay 9% of income above that level. At the end of the tax year, a borrower with total earnings below the annual student loan repayment threshold, may reclaim any repayments made where a pay period threshold was exceeded.

If earnings fall below the repayment threshold, borrowers are not required to make repayments, regardless of their plan. Any outstanding loan, including interest accrued, will be cancelled after the loan term ends, and debt is never passed on to family members or descendants.

Question to the Department for Education:

To ask the Secretary of State for Education, what comparative assessment her Department has made of the (a) average repayment duration and (b) total interest paid over the life of the loan for (i) male and (ii) female Plan 2 student loan borrowers.

Answered by Josh MacAlister - Parliamentary Under-Secretary (Department for Education)

The median repayment duration of loans for students in the final cohort of Plan 2 borrowers, those who commenced study in the 2022/23 academic year, is 30 years. This is consistent with the average borrower in this cohort not being forecast to fully repay their loan and instead have some loan debt written off after 30 years. Information on repayment behaviour for this cohort is published here: https://explore-education-statistics.service.gov.uk/find-statistics/student-loan-forecasts-for-england/2022-23.

The department does not hold figures comparing the lifetime repayment duration for male and female Plan 2 borrowers or the total interest paid over the life of the loan.

Question to the Department for Education:

To ask the Secretary of State for Education, what estimate she has made of the long-term fiscal impact of replacing RPI with CPI for Plan 2 student loan interest.

Answered by Josh MacAlister - Parliamentary Under-Secretary (Department for Education)

Interest rates on student loans have been consistently linked to a widely recognised and adopted measure of inflation. Interest rates are set in legislation in reference to the Retail Price Index (RPI) (from the previous March) and are applied annually on 1 September until 31 August.

The Office for National Statistics has undertaken a substantial programme of work over the past two years to enhance how inflation is measured and this will be carried over into student loans. The Office for Budget Responsibility has confirmed that from 2030 (at the earliest), movements in RPI will be aligned with Consumer Prices Index including owner occupiers' housing costs as viewed here: https://obr.uk/box/the-long-run-difference-between-rpi-and-cpi-inflation/.

Found: Mundell (Conservative; Dumfriesshire, Clydesdale and Tweeddale) James Naish (Labour; Rushcliffe) David Reed

Found: Mundell (Conservative; Dumfriesshire, Clydesdale and Tweeddale) James Naish (Labour; Rushcliffe) David Reed

Found: meeting Members present: Clive Efford (Chair); Luke Akehurst; Al Carns; Mr Paul Foster; Mike Martin; David Reed

Found: David Reed appointed Trade Commissioner for Eastern Europe

Found: Taxi; Scheduled Flight Standard; Premium Economy; Economy £3,575.22 £1,200.33 £22.04 £4,797.59 David Reed

Found:

Found: European Leadership Network Lunch Yes Harriet Thompson Nil Return Nil Return Nil Return Nil Return David Reed

Found: