Student Loans

Debate between Meg Hillier and Julie Minns

Tuesday 15th September 2026 Commons Chamber

[Dame Meg Hillier]

I absolutely think it should be a high priority, because this generation is being so severely squeezed. The Government’s response to the Committee said:

“The Government recognises the cost-of-living challenges faced by many graduates, including those with Plan 2 student loans, and understands concerns about the impact of repayment terms on borrowers.”

The response says further that the Government

“keep all aspects of the student finance system under review.”

This is one change that is very simple to make and relatively cheap. I recognise that the Chancellor has had many challenges even since we put out our report, but this is an achievable change that could be done quickly and would make a big difference to this cohort.

[Ms Julie Minns (Carlisle) (Lab)]

One of the themes that comes through quite clearly in the report is the complexity of the student finance system and the difficulty that students have in understanding what they will actually pay—that is mis-selling, as I think my hon. Friend described it. Given that the Government appear to accept that the terms are confusing, is it fair that they continue to penalise borrowers who were potentially misled?

[Dame Meg Hillier]

One good thing is that the Government have recognised that problem in their response to us. We are dealing with mostly teenagers under the age of 18. Sometimes those going to university for the first time do not have other people around them who can advise them about the impact of a loan, and many have no choice and have to take out a loan. The cohort now paying back under plan 2 is being further penalised by the threshold change, so more and more is being layered on that particular cohort. There needs to be more fairness in the system.