Overview
- The government will hold the earnings threshold at £29,385 for three years from the April 2026 level, bringing more graduates into repayment sooner.
- IFS analysis estimates average annual payments for Plan 2 borrowers will rise by about £93 in 2027–28 and £259 by 2029–30.
- For those who started in 2022, expected lifetime repayments increase by around £3,200 on average, with lower‑middle earners paying roughly £5,000 more, and the cohort projected to repay more than they borrowed in real terms.
- The IFS says the freezes save the government about £1.3bn, reducing the taxpayer share of student loan costs to roughly 3%.
- FOI figures show about 2.73 million people who repaid in 2024–25 accrued more interest than they paid, with £15.2bn of interest added versus £5bn repaid under rates set at RPI plus up to 3 percentage points.