Question to the Department for Education:

To ask the Secretary of State for Education, if she will make an assessment of the potential merits of introducing an alternative to the fee-based funding model for higher education.

The higher education (HE) sector needs a secure financial footing to face the challenges of the next decade and to ensure that all students can be confident they will receive the world-class HE experience they deserve. This is why, after seven years of frozen fee caps under the previous government, we have taken the difficult decision to increase maximum tuition fee limits for the 2025/26 academic year by 3.1%, in line with the forecast rate of inflation.

The government believes in the principle that a fee-based funding model and income-contingent student loan repayment system is the most equitable way of ensuring that individuals who have benefited directly from HE make a fair contribution towards its cost. Upfront tuition fee loans have allowed many more students, including disadvantaged students, to access HE through removing financial barriers so that everyone with the ability and desire to enter HE can do so.

Student loans have important protections for borrowers. Monthly repayments depend on earnings, not on interest rates or the amount borrowed, and no-one who earns under the student loan repayment threshold is required to make any repayments at all. At the end of the loan term, any outstanding loan balance, including interest built up, will be written off with no detriment to the borrower.

The department will publish its plan for broader HE reform this summer and work with the sector and the Office for Students to deliver the change that the country needs.