Powell says student loan system at top of in-tray

Lucy Powell has said she wants to make definite the pupil loans strategy is "fair" and that the contented is at the apical of her in-tray as the caller acquisition secretary. Labour's lawman person told the BBC she stood by comments she made in February that the involvement rates graduates with Plan 2 loans were paying were "egregious". She said she was committed to looking at the issue, though acknowledged she "can't marque immoderate promises" about changes. Plan 2 loans were taken out by students in England between September 2012 and July 2023, and are still issued in Wales. Graduates pay back what they earn above the repayment threshold at a rate of 9%. In November past year, then-Chancellor Rachel Reeves said the repayment threshold for students with Plan 2 loans would be frozen at £29,385 between 2027 and 2030, instead of rising with inflation. The alteration would result in students starting to repay their loans sooner than they would otherwise have done, and their rising salaries leading to greater repayments. Campaigners have called for that determination to be reversed. Reeves earlier said the government's measures were "fair and proportionate" for getting "the equilibrium close between taxation and spending". In April, the authorities said interest on some pupil loans in England – including Plan 2 – would be capped at 6%. Speaking to Matt Chorley on BBC Radio 5 Live, Powell said she was "very familiar" with the contented as her eldest kid has a Plan 2 loan. She said: "I deliberation it's not conscionable astur the threshold of erstwhile radical commencement to wage it back, but besides the involvement complaint which is RPI [retail prices index] positive 3%." "I deliberation I've called it successful the past egregious and I'm not going to alteration my sentiment connected that conscionable due to the fact that I'm present the caput of state." "The authorities has committed to a reappraisal of that, it's precise overmuch astatine the apical of my in-tray arsenic the caput of state, and I privation to marque definite we look astatine this truthful it's just for students." Powell described it as a "real cost-of-living issue" for young people, adding: "They're paying precocious repayments and never, ever paying disconnected the superior of their pupil loan." Pressed on whether it is something she will look at, Powell replied: "Yes. I can't marque immoderate promises, but it needs looking at." MPs on the Treasury Committee this month said comparing pupil indebtedness repayments to telephone contracts or cinema tickets "amounted to mis-selling" by government. It came after a BBC investigation recovered the authorities compared pupil indebtedness repayments to £30-a-month telephone contracts in promotional presentations to teenagers a decade ago. Earlier this year, Conservative person Kemi Badenoch said she would cut the rate of interest charged on Plan 2 loans, capping it at RPI only. The existing RPI rate is 3%.