Student Loans: Review

Earl of Effingham Excerpts

Tuesday 24th February 2026 Lords Chamber

[Baroness Smith of Malvern (Lab)]

My noble friend makes a very important point. I went to university without a student loan, but I was part of only 14% of young people who were able to benefit from higher education. That figure now stands at more than 50%, and we need a student finance system that recognises that. I reiterate that the Government are making changes to student finance. We will reintroduce student grants and we are increasing maintenance loans for students. We are therefore opening up the opportunity for more students from lower-income backgrounds to get the benefits that higher education brings.

[The Earl of Effingham (Con)]

My Lords, as my noble friend Lord Young of Cookham put it so well, Rachel Reeves says that the student loan system is “fair and reasonable”; Lucy Powell, on the other hand, says that the system is “unfair” and “egregious”, while Bridget Phillipson says that it is not a priority for the Government. With three contradictory views on a review of student loans, is it any surprise to the Minister that, according to the latest Ipsos survey, over two-thirds of the country

“do not have confidence that the Government is running the country … properly, competently or seriously”?

[Baroness Smith of Malvern (Lab)]

I wonder whether the noble Earl has had the opportunity to discuss with some of his colleagues whether they believe that the system that they introduced is a scam. This is a system that was introduced by the previous Government. Plan 2 is no longer in operation for students starting today. Finally, if the leader of the Opposition is trying to suggest to students that they will repay less through a cap on interest, she would, of course, be misleading them, because that would not be true.