Overview
- An analysis by London Economics, commissioned by NUS and HEPI, finds the 2022/23 Plan 2 cohort delivers a surplus of about £679 million and saves the Treasury more than £5 billion versus previous terms.
- Freezing the repayment threshold drives most of the change, with the 2022 freeze adding roughly £4.6 billion and a later three‑year freeze at £29,385 adding about £1.3 billion by pulling repayments forward.
- Ministers defend the system, saying they inherited Plan 2, raised thresholds in the past two years, and will cap interest on Plan 2 loans at 6% from September.
- Researchers say lower and middle earners face the bigger hit, with graduates on £40,000 or more projected to repay about £740 extra in 2032 under the revised terms.
- NUS and HEPI back a stepped, income‑banded repayment model that modelling says would be near cost‑neutral, as a Treasury Committee inquiry takes evidence until 14 April.