12 English Universities Give Loan Examples on Below-Average Pay
Applicants in England who want to know what a student loan will cost them can look at university websites. A BBC check found that some give repayment examples based only on pay below the national average, and a few carry plain errors.
How Plan 5 repayments work
Students starting in England now take out Plan 5 loans for tuition fees and living costs. Under the rules, 9% of every pound earned over £25,000 goes to the loan, until it is paid off or 40 years have passed. The more a graduate earns, the more they pay each month.
Someone on £30,000 repays £37.50 a month. Someone on £100,000 repays £562.50.
What the websites say
The BBC reviewed public information on more than 110 university websites in England. Most gave no worked examples at all, and most pointed to guidance from the Department for Education (DfE), the Student Loans Company or Student Finance England.
Twelve gave examples based on pay lower than the UK average of £39,039. More than a dozen used higher-than-average earnings. The lowest figure came from the University of Gloucestershire, which put a £26,000 salary at £7.47 a month. Northumbria and Huddersfield each gave a £35,000 salary and a £75 monthly repayment.
Northumbria's page said such graduates would be "repaying an amount less than the cost of a daily coffee". That line was removed after the BBC got in touch. The university said £35,000 was broadly in line with the average for full-time workers in the North East of England.
Errors found on university pages
Some pages were simply wrong. Exeter said Plan 5 loans are written off a decade earlier than they are. Royal Holloway and Edge Hill listed the wrong repayment thresholds, and Harper Adams said English students were still on Plan 2 loans. All four have since updated their sites.
The DfE site gives monthly examples only up to £38,400, for other loan plans. It has no real-world repayment example for Plan 5 students.
MP calls for change
Dame Meg Hillier, who chairs the Treasury Committee and led an inquiry into student loans this year, said some of the information was misleading. She said the DfE must add higher-salary examples to its own site. "I'm pretty shocked at what the BBC has uncovered here," she said, and promised to raise it with MPs.
The committee's own report had already faulted the DfE for not explaining what higher earnings do to monthly repayments. It also criticised comparisons with £30-a-month phone contracts. The DfE then pledged to improve the information given to prospective borrowers. It now says it will review what it publishes and is working with universities to keep their information clear and up to date.
Megan Russon, 21, a recent graduate from Cannock, earns about £29,000 as a tax accountant and repays around £30 a month. She expects to earn about £50,000 once chartered in three years, which would mean roughly £187 a month. She says open day examples suggested repayments would be minimal.
The universities replied in different ways. Gloucestershire, Birmingham and Harper Adams said they had updated their sites, and Birkbeck is reviewing its page. Sheffield said its example was illustrative. Manchester Metropolitan and Wolverhampton said theirs were explanatory and would be reviewed. Birmingham City declined to comment, and the BBC was still waiting to hear from Huddersfield.
Source: BBC News