§ Mr. RendelTo ask the Secretary of State for Education and Skills what assessment he has made of debt incurred in the course of doing a university degree as a proportion of lifetime income, as an average for graduates. [82775]
§ Margaret Hodge[holding answer 25 November 2002]: Information on student loan accounts is held by the Student Loans Company, and relates to publicly owned debt or to debts held in the private sector following the two Government debt sales. Information on students' private sector debt such as overdrafts and other commercial loans is not available centrally.
The second cohort of students on a three-year degree course who entered higher education under the new student support arrangements are due to enter repayment in April 2003. The average debt of a borrower with a new income contingent loan entering repayment in that year is estimated to be some £7,380. This includes borrowers who have completed three years of study from 1998 as well as those on shorter courses or who have left higher education early.
The figure provided is very small when compared to the estimated average lifetime earnings of graduates whose highest qualification is a first degree, which is, undiscounted, around £1,075,000. All of these figures relate to Great Britain.
§ Annabelle EwingTo ask the Secretary of State for Education and Skills what discussions he has had with the Scottish Executive regarding his Department's inquiry into funding for students in higher education. [82417]
§ Margaret Hodge[holding answer 25 November 2002]: My right hon. Friend holds regular discussions with my Scottish counterpart on a range of issues of mutual interest. I have also spoken with the hon. Gentlemen regarding higher education issues.
§ Mr. RendelTo ask the Secretary of State for Education and Skills if he will estimate the level of funding required if university grants had been maintained at their final level in(a) real terms and (b) actual terms in (i) 1998–99, (ii) 1999–2000, (iii) 2000–01, (iv) 2001–02 and (v) 2002–03, broken down for students originating in (a) England and (b) Wales. [83011]
§ Margaret Hodge[holding answer 25 November 2002]: Under the "Mandatory Awards" scheme in operation up to academic year 1997–98 students received two forms of grant:
- (i) an award for maintenance, and
- (ii) an award paid by LEAs to Higher Education Institutions towards tuition fee costs.
Tables 1 and 2 show the estimated funding required for LEA expenditure on awards for fees and maintenance in real and cash terms for each of the financial years 1998–99 to 2002–03, assuming that the grants available in 1997–98 had continued thereafter.
564W
Table 1: Estimated Grant Funding in real1 terms £m Year England Wales Total 1998–99 1,815 11 1,926 1999–2000 1,812 111 1,922 2000–01 1,795 114 1,909 2001–02 1,823 115 1,935 2002–03 1,841 116 1,957 1 Figures have been converted to 1998–99 price levels using the September 2002 GDP deflators. Note:
Figures may not sum due to rounding.
Table 2: Estimated Grant Funding in cash terms £m Year England Wales Total 1998–99 1,815 111 1,926 1999–2000 1,855 114 1,969 2000–01 1,880 119 1,998 2001–02 1,950 123 2,073 2002–03 2,018 128 2,145 Note:
Figures may not sum due to rounding
These are approximate estimates derived by applying the grant arrangements in 1997–98 to numbers of England and Welsh students for the academic years 1998–99 to 2002–03. Costs for English and Welsh students have been pro-rated on the basis of numbers of students from each country.
Tables 3 and 4 shows the award payments for fees and maintenance made by LEAs in real and cash terms under the "Mandatory Awards" scheme for each of the financial years 1998–99 to 2002–03.
Table 3: Outturn Grant Payments in real1 terms £m Year England Wales Total 1998–99 1,491 91 1,582 1999–2000 672 41 713 2000–01 268 71 8 2001–02 71 4 75 2002–03 8 1 9 1Figures have been converted to 1998–99 price levels using the September 2002 GDP deflators. Note:
1. Figures may not sum due to rounding
2 Figures for England and Wales have been estimated.
3 2000–01 outturn is provisional.
Table 4: Outturn Grant Payments (cash terms) £m Year England Wales Total 1998–99 1,491 91 1,582 1999–2000 688 42 730 2000–01 281 18 298 2001–02 76 5 80 2002–03 9 1 9 Note:
1 Figures may not sum due to rounding.
2 Figures for England and Wales have been estimated.
3 2000–01 outturn is provisional
Costs for English and Welsh students have been pro-rated on the basis of numbers of students from each country.
565WIn addition, students also receive a subsidised loan towards living costs.
§ Mr. BoswellTo ask the Secretary of State for Education and Skills what action he is taking to minimise overpayment of student loans under the Inland Revenue collection arrangements. [83940]
§ Margaret HodgeThe Student Loans Company (SLC) has this month introduced a special service for borrowers who have nearly completed repayment of their income-contingent loans. Based on a projection of earnings from the borrower, the SLC will tell the Inland Revenue when repayments should stop being collected. This "self-predictor" model is designed to prevent employers collecting too much and the borrower having to obtain a refund.
My officials are also working with the SLC on more advanced web-based approaches as part of our programme to modernise the delivery of student support.
§ Mr. BoswellTo ask the Secretary of State for Education and Skills what action he is taking in conjunction with the Student Loans Company to improve availability of information on the amount of outstanding loan liabilities for individual graduates. [83941]
§ Margaret HodgeBorrowers under the pre-1998–99 scheme of mortgage style loans receive annual statements from the Student Loans Company (SLC) showing what has been repaid and the outstanding balance owed. Borrowers can call or write to the SLC at any time, and be given an up to date statement.
For most borrowers under the current income-contingent loans scheme, repayments will be collected by their employers through deductions from their earnings, with tax and national insurance contributions. These borrowers receive a statement from the SLC after the end of the tax year, once it has received details of what has been collected by the Inland Revenue.
As well as the yearly statement, borrowers' payslips contain details of their repayments. If a borrower contacts the SLC, it can provide an estimate of the amounts repaid and what is outstanding using the information on the borrower's payslips. Borrowers can contact the SLC over the phone for this information.
The SLC has this month introduced a service for borrowers under the income-contingent loan scheme who have nearly completed repayment of their loan. Based on a projection of earnings from the borrower, the company will tell the Inland Revenue when repayments should stop being collected. This is designed to prevent employers collecting too much and the borrower having to obtain a refund.
Self-employed borrowers receive their statements after making their self-assessment return to the Inland Revenue.
§ Mr. BoswellTo ask the Secretary of State for Education and Skills if he will pay interest on repayments in cases where individual graduates have overpaid their student loan liabilities. [83942]
§ Margaret HodgeBorrowers who have overpaid their student loans, through deductions from their salaries, are entitled to a full refund of the amount overpaid with566W interest. The interest is paid at the same rate as it is charged on the loan—at the rate of inflation—and is tax free.