Students: Loans
The question
To ask the Secretary of State for Education, whether she plans to review (a) the age-65 write-off rule and (b) other terms of pre-2006 Plan 1 student loans to create consistency with later cohorts of borrowers whose loans are written off after 25 years.
Answered by Josh MacAlister
Where a new plan type is introduced, the terms, including the length of the loan, are considered as a whole. The new terms are not applied retrospectively to borrowers who have signed up to previous plans in existence at the time of their study. They are then set in legislation to apply to that specific loan type.
Although both pre-2006 and post-2006 Plan 1 loans retained the Plan 1 title, these are different plan types.
Plan 1 post-2006 included a shorter loan term of 25 years, however, tuition fee increases resulted in higher loan balances on course completion than for pre-2006 borrowers. Pre-2006 borrowers, whose loan term ends aged 65, benefitted from lower tuition fee loans and a lower loan balance on completion of their course.
There are no plans to review pre-2006 Plan 1 terms and conditions, including the age 65 write-off term.
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