BBC finds student-loan repayment examples omit higher salaries

A BBC review of more than 110 university websites in England found that 12 gave student-loan repayment examples based only on salaries below the UK average, while several also contained inaccurate information about repayment rules.

The findings have prompted Treasury Committee chair Dame Meg Hillier to call for the Department for Education (DfE) and universities to give students clearer examples, including for people who earn more as their careers progress. The DfE says it will review its guidance and is working with universities to keep their information clear and up to date.

For Plan 5 loans, taken out by English undergraduates who started in August 2023 or later, borrowers repay 9% of earnings above £25,000. That means monthly repayments rise with salary: the BBC calculated that someone earning £30,000 would pay £37.50 a month, compared with £562.50 for someone earning £100,000.

The BBC found that most university websites it reviewed did not provide worked repayment examples. Among those that did, 12 used salaries below the UK average of £39,039. Examples included monthly repayments of £7.50 at the University of Gloucestershire and £75 at Northumbria University and the University of Huddersfield.

Northumbria had described a £75 repayment, based on a £35,000 salary, as less than the cost of a daily coffee. It removed that comparison after the BBC contacted the university. Northumbria said the salary was broadly in line with average full-time earnings in the North East and that it would review its wording.

The review also identified errors in information about loan write-off periods, repayment thresholds and which loan plan applied to some students. The universities concerned updated their websites after the BBC contacted them.

Hillier said some of the information was “misleading” and said she would urge MPs to press universities to improve it. She argued that the DfE should lead by showing how repayments change for higher earners, while universities also had a responsibility to students.

The DfE said its guidance explains how repayments are calculated across different plans. It said it had committed to reviewing its information following Treasury Committee recommendations, including the effect of salary progression on monthly repayments.

Universities gave varied responses. The Open University said its examples reflected income levels likely to match its students’ circumstances, while noting many go on to earn significantly more. The University of Portsmouth said its example came from Student Finance England and would be updated. The University of Sheffield described its example as illustrative; Manchester Metropolitan University and the University of Wolverhampton said they would review their examples. Birkbeck said it was reviewing its information. Birmingham City University declined to comment, and the BBC said it had requested a response from Huddersfield.

The issue follows a Treasury Committee inquiry into student loans. Hillier has previously criticised information about how repayments change with earnings, and the DfE has pledged to improve guidance for prospective borrowers.