Tens of thousands of graduates will have to start repaying their student loans sooner because of a “stealth tax” announced in the Budget, The i Paper can reveal.
An extra 161,000 graduates are set to see their monthly pay deducted due to Labour’s decision to freeze the repayment threshold for Plan 2 loans for three years – instead of increasing it in line with inflation, according to analysis by the Centre for Business and Economics Research (CEBR).
More than a fifth (22 per cent) of Plan 2 borrowers who are currently under the repayment threshold of £29,385 will have to start making repayments during the freeze from 2027 to 2029, the economics consultancy’s research for The i Paper found.
Shorts
Plan 2 loans were issued in England between September 2012 and July 2023 and are still used in Wales.
