Student Loans

Debate between Meg Hillier and Sarah Russell

Tuesday 15th September 2026 Commons Chamber

[Dame Meg Hillier]

I thank my hon. Friend for the excellent work that she and her Committee do. We know that there is a crisis in the higher education system, but there is also a huge challenge for the graduates paying off these loans. It is a multifaceted picture, so I am pleased that the Government are looking at reviewing it, but people have just started plan 5 repayments, and a review that might see any changes is still a long way off.

We need to have the national conversation that I mentioned about a 50:50 balance. Society benefits from most graduates. They are not just taking; they are actually giving back, and it is really important that we recognise that in our national conversation. Frankly, universities are really struggling in part because of the way in which fees are structured, meaning that they are not getting enough money, but they are still very expensive for students, so nobody is winning in this situation.

[Sarah Russell (Congleton) (Lab)]

One of my constituents has been in touch. He is a neonatal nutritionist and is paying a marginal tax rate on his loan of 57%. Does the Chair of the Treasury Committee agree that that is not an acceptable outcome socially and that we must have change?

[Dame Meg Hillier]

When I looked at this issue in previous roles, before I was on the Treasury Committee, I found that one of the challenges is that the loan system is set up with lots of box-ticking and spreadsheets happening in Government Departments in Whitehall—a very long way from a 17-year-old who takes out a loan and starts paying it back after they graduate. We need to have them at the heart of the design. There will always be a discussion in government about where money is best spent and how much things cost in the short, medium and long term, but we need to ensure that the graduates paying back their loans are at the heart of that discussion, alongside the impact on further education institutions.