Chancellor Rachel Reeves has urged repayments on loans may very well be lower by reducing inflation.
For Plan 2 loans, interest is at the moment charged on the price of Retail Prices Index (RPI) plus up to 3%, relying on how a lot a graduate earns.
Badenoch stated she would cap the interest charged to RPI solely, which is at the moment 3.8%, arguing it will assist the next variety of college students repay their money owed.
The Conservative chief wrote: “I am horrified at what graduates today are dealing with, and this is one of the reasons millions of young people feel they’ve been stitched up.”
The Conservative-Liberal Democrat coalition authorities launched Plan 2 loans in 2012 and tripled tuition charges to up to £9,000 a yr.
Responding to Badenoch’s plans, the training secretary remarked that it was “galling” to see the Conservatives complaining a few system that their authorities helped usher in.
“There are flaws in that system,” Phillipson stated, however she careworn it was one “the Conservatives left behind”.
Shadow training secretary Laura Trott shed extra mild on the Conservatives’ plan on Sunday with Laura Kuenssberg, saying that the occasion desires to “stop the Government funding dead-end university courses”.
Citing a 2020 report from the Institute of Fiscal Studies, which discovered up to 30% of young people going to university have negative returns, external, she stated she would really like to shut 100,000 college locations to alleviate debt and fund apprenticeships.
Pressed by Kuenssberg about which programs can be compelled to shut, Trott supplied the instance of artistic arts.
Some 75% of loans for these programs, she stated, are “not paid back”.
It was put to Trott that this might trigger some universities – which are already facing financial challenges – to shut.
The shadow training secretary acknowledged that these are “difficult” choices however they’re the correct ones to be making to assist younger individuals safe work.
“We’d have to look at the effect on the whole system, but I refuse to keep funding degree courses which are not delivering for young people.”
