Student Loans: Muslim Students

Lord Elton Excerpts

Thursday 3rd March 2016 Lords Chamber

[Baroness Evans of Bowes Park]

I am happy to. The takaful model will operate as a type of mutual fund. Students will apply for finance from the fund the same way that they would apply for an equivalent student loan and will enter a contract promising to repay a contribution. When they are earning above the repayment threshold, as with an equivalent student loan, they will make their contributions, which will be used to fund the education of future students. It is a type of mutual fund, which is why BIS cannot introduce it without primary legislation, as the Secretary of State does not have those powers.

[Lord Elton (Con)]

My Lords, the Secretary of State does have the power to initiate legislation. I ask my noble friend to urge him to take the opportunity as soon as Parliament reassembles after State Opening to introduce a Bill—a small Bill—for the simple purpose of introducing this change, rather than waiting for some great wagon train to assemble for the next 18 months.

[Baroness Evans of Bowes Park]

As I have said to noble Lords, the Government hope to introduce the system and will be looking at the appropriate legislative way to do so. As my noble friend says, the up-and-coming Session will be detailed in the Queen’s Speech in due course.