Stop The Sale Of Student LoansBy Editor
The Government are planning to sell off student loans, which will mean higher payments for over 3 million students.
A speech given to Parliament by Lib Dem, Danny Alexander the Chief Secretary to the Treasury outlined the Governments plans to sell off £15 billion of public assets by 2020. This includes ‘The Student Loan Book’ which is worth around £10bn.
What does this mean for you? Well if you were a student between 1998 and 2012 and you had a student loan then it will take you longer to pay it off because you could end up paying triple the amount of interest. The interest on your loan is currently capped at 1.5%, but the proposals could mean that this will rise to 3.6%.
Those who started University in 2012 don’t worry, you’re not getting left out. The interest on your loan is already calculated at around 3%, based on the RPI or the base rates of a number of banks, whichever is the lowest.
The government will get an initial cash boost from the sale of the ‘Student Loan Book’ and the removal of the loans from the public debt.
This may seem what we need in these times of austerity, but is it?
As it stands now the money you pay back on your student loan is invested back into the UKs economy. If the ‘Student Loan Book’ is sold off and privatised then there is no guarantee that this will continue.
We also have to look at the system in the US. The rate of interest on their student loans is currently 6.8%. This could become a possibility for UK students.
The 2008 Sale of Student Loans Act means that the government can authorise the sale of the ‘Student loans Book’ without any consultation or Parliament vote.
Dr Thomas Richard Bowers has started an e-petition against the proposed privatisation. If the petition reaches 10,000, the government would have to officially respond to the petition. But if the petition reaches 100,000 then the matter would have to be debated within parliament.
We urge all our students to sign this petition and force the matter to be debated within parliament and stop the sale of student loans.