Students: Loans
The question
To ask the Secretary of State for Education, what estimate she has made of the proportion of the total value of Plan 2 student loans issued since 2012 that will be written off.
Answered by Josh MacAlister
The department does not hold an estimate of the proportion of total Plan 2 outlay since 2012 that will be written off. We forecast subsidy portions for outlay for current and future financial years.
We estimate a resource accounting and budget (RAB) charge of 34% for Plan 2 loan outlay issued in the 2025/26 academic year to English domiciled borrowers. The RAB charge represents the subsidy portion of loan outlay as recorded in departmental accounts.
Outstanding debt, including interest accrued, is cancelled at the end of the loan term with no detriment to the borrower, and debt is never passed on to family members or descendants. There are no commercial loans that offer this level of borrower protection. This cancellation/subsidy is a conscious investment in our young people and the skills capacity, people and economy of this country.
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