Plan 2 student loans, the system most people who started university from 2012 to 2023 are on, increasingly feel like a scam.
Under Plan 2, the interest on your loan is 3 per cent above inflation, so your loan can grow so fast that you can be paying the appropriate amount every month yet see the balance go up.
The Conservatives would scrap the additional 3% and cap interest at RPI, so balances stop accelerating upwards. For example, a graduate with £40,000 of debt earning £50,000 could save around £26,000 over their lifetime.
This will be funded by cutting 100,000 places on University courses that don’t enhance young people’s careers - no longer funding courses that leave young people with large debts & weak job prospects.
Instead of subsidising low-value courses, the funding would be redirected into 100,000 additional apprenticeships each year for 18 to 21 year olds, helping more young people access high-skilled, well-paid careers. That means strengthening technical and vocational routes into skilled trades such as plumbing and electrical work.
Please let me know what you think about our plans to cut Student Loan interest payments and reduce the debt burden on our young graduates.