Wales retains fairer student loan repayment system
Cymru yn cadw system ad-dalu benthyciadau decach i fyfyrwyr
The Minister for Education and Welsh Language has announced Wales will retain our current fairer and progressive student finance repayment system, despite changes made in England.
Wales’s student support repayment system has historically been aligned to England’s, but adopting the new English system would mean Welsh students would repay loans over a longer period of time, with higher earners paying less and middle- and lower-income earners paying back more than at present.
Last year the Welsh Government had originally decided to temporarily retain the current student loans system for the academic year to assess the changes being made in England.
Jeremy Miles has now decided to retain the current, fairer and more progressive system for future years, subject to annual review to ensure it remains sustainable.
The current progressive system of student finance means that Welsh undergraduate students have less to repay on average than their English peers as we continue to provide non-repayable grants and they receive a guaranteed level of maintenance support irrespective of their household income.
The Minister for Education and Welsh Language said: “The UK Government’s regressive reforms benefit the highest earners and worsen the position of middle and lower earning graduates.
“Though Wales’ repayment system has historically been aligned to England’s, my view is that the new system in England is not a good deal.
“The reforms benefit the highest earners and worsen the position for middle and lower earning graduates. Women are also disproportionately affected.
“We certainly shouldn’t be asking teachers, nurses and social workers to pay more, while the highest earners pay less.
“I can therefore announce today that we will not move to the system adopted in England but will retain the current system. This means Welsh graduates will continue to repay loans for a 30-year repayment period rather than 40-years as will be the case in England.”
Notes to editors
Plan 2 applies to students who began their course on or after 1 September 2012. The yearly threshold for repayment is £27,295, monthly is £2,274 and the weekly threshold is £524. The repayment term is 30 years.
Plan 5 applies in England for students who will begin their course on or after 1 September 2023. The yearly threshold for repayment is £25,000, monthly is £2,083 and the weekly threshold is £480. The repayment term is 40 years.