Loan reforms create ‘huge uncertainty’ for public finances

Institute for Fiscal Studies says benefits to the public purse are far from clear

Government reforms to the student loans system will greatly increase uncertainty in public finances, an analysis by the Institute for Fisca Studies has concluded.

As part of its response to Philip Augar’s review of post-18 education and funding, ministers announced in February that the threshold at which students in England will begin repaying their student loans is to be cut to from just over £27,000 to £25,000. The maximum period over which they are eligible to repay was also increased from 30 to 40 years.