Lords Committee expresses concern over lack of information on the impact of changes to student loans legislation

The Regulations have been laid by the Department for Education (DfE) and make changes which mean the current repayment thresholds for student loans that applied in the 2021-22 financial year will be maintained and continue to apply in the 2022-23 financial year. This avoids an automatic 4.6% increase of these thresholds on 6 April 2022.

The Committee recognised the need for financial prudence in the public sector and DfE’s commitment to ensure the ongoing sustainability of the student loan system, however it expressed concern regarding the impact on those who have student loans.

In its report the Committee said that while DfE made it clear in the EM that the changes made by this instrument will generate an expected £3.7 billion of savings in public sector net borrowing over the period up to and including financial year 2024-25, it is silent on any additional costs those with student loans might incur as a result of these changes. This omission concerned the Committee which has prompted it to draw the Regulations to the special attention of the House on the ground that they are politically or legally important and give rise to issues of public policy likely to be of interest to the House.

Lord Hutton of Furness, Member of the Secondary Legislation Scrutiny Committee said;

“Explanatory Memorandums are designed to accompany an instrument so as to provide Parliament and the public who will be affected by any changes in the law with a clear understanding of any such effects and how they will be practically operated.

“In this instance, we are particularly concerned that while these changes will affect a large portion of the student population and possibly their families, the EM only emphasises the savings Government will make and is silent on the costs to those who have student loans. This is unsatisfactory and the House may wish to raise this omission with the Minister.”