Question to the Department for Education:

To ask the Secretary of State for Education, what recent assessment has been made of the potential impact of student loan interest rates on total debt; and what legislative steps are being taken to lower the overall debt burden on recent graduates.

The department recently published a set of statistics presenting analysis of earnings and lifetime repayment forecasts for student loans in England, which looks at the level of earnings required to reduce student loan balances, taking interest accrual into account. These statistics are available at: https://explore-education-statistics.service.gov.uk/find-statistics/student-loan-forecasts-earnings/2025-26.

The government has capped the maximum interest rates on Plan 2 and 3 student loans at 6% for the 2026/27 academic year. We are clear it does not resolve all the issues with the inherited Plan 2 system. We are considering a range of options to make the system fairer. However, to be fiscally responsible, we must consider how any change would be funded.