This September, those starting university courses in England will see major changes to the way they pay back their student loans. New conditions mean that the annual salary threshold at which student loans are repaid will be reduced from £27,295 to £25,000, the repayment term will be extended from 30 to 40 years, and the interest rate will be lowered from an above inflation rate to a below inflation rate.
The public tend to back these changes, with 41% saying they support and 34% saying they oppose the new rules. Younger people are more likely to oppose the reforms than those in older age groups, however: 43% of 18-24 year olds say they oppose the measures, compared to 35% of those aged 25-49, 36% of 50-64 year olds and 26% of those over 65.
Non-graduates are more likely to support the changes than graduates, with 45% of non-graduates backing the changes, versus only 35% of graduates. Half of graduates (50%) oppose the changes, compared to 28% of non-graduates.
Conservative voters are also more likely to support the changes (54%) than Labour voters (29%).
The IFS has said that the changes will be a financial benefit the highest earning graduates, while all other graduates will end up paying more back over the lifetime of their loan.
When asked whether they think students will end up repaying more or less money under the new plans, the most common expectation among English people is that they will repay more. One in three (35%) think students will pay more than they currently do, while just one in ten (10%) think they will pay less. A quarter (28%) think the changes will make no difference.
Although people are more likely to think graduates will pay back more, they still tend to expect that graduates will be net better off financially better as a result of going to university. Four in ten English people (41%) think that graduates’ higher wages will offset the cost of going to university, compared to 32% who think over the course of a lifetime they will not make as much extra cash to compensate for the portion of the tuition fees they end up repaying.
Those who are university graduates themselves, however, tend to think that students under the new regime will end up worse off in the long term by 44% to 37%. Non-graduates take the opposite view, being more likely to say graduates under the new rules will end off better off (44%) than worse off (27%) after university.
University is currently bad value for money, say English people
While English people might support the incoming changes, and think that graduates will remain better off financially for having gone to university, they also think the cost of university education in England is not good value for money.
While 70% think £1,000 a year – about the cost between 1998 and 2006 – is good value for a university education, and 64% say the same of £3,000 a year – about the cost from 2006 to 2012 – this figure slumps to just 19% for £9,250 a year – the current level.
When asking graduates, opinions are mirrored. Just 18% think the current cost of university education is good value for money, with 69% saying they think it is bad value for money. Similarly, just 21% of non-graduates think the current cost is good value, and 42% think it is bad value for money.