Question to the Department for Education:

To ask the Secretary of State for Education, whether she has made an assessment of the financial impact of the Student Loans Company's decision to change the overseas earnings thresholds for Poland for Plan 2 student loans from £16,380 in 2022-23 to £10,920 in 2023-24 on students.

The repayment of student loans is governed by the Education (Student Loans) (Repayment) Regulations 2009 (as amended) (the Regulations). The department calculates the overseas student loan repayment thresholds on behalf of the Student Loans Company, based on the cost of living of different countries relative to the UK. Countries are grouped in 'bands' with different levels of higher or lower costs of living, compared to the UK.

The Regulations set out the specific data and methodological approach to be used to determine the bandings repayment thresholds of different countries. Bandings are based on price level index (PLI) data published by the World Bank. The PLI is the average price of a given class of goods and services in a given region during a given period of time and is used as a proxy measure for the cost of living. Using a recognised measure of the relative cost of living in different countries ensures that borrowers residing in different countries are assessed in a fair, transparent and consistent way.

Bandings are reviewed annually based on the latest published PLI data. This means a country’s banding may change as a consequence of macroeconomic changes. The World Bank data shows that for the last few years, the PLI for Poland has been declining gradually, relative to the UK. At the last annual review, this caused Poland to move to a different band, which in turn resulted in a reduction in the repayment threshold for borrowers residing in Poland.