Student Debt Has Risen To More Than £100 Billion In The UK
The Debrief: And it’s set to double to £200bn in the next six years. Ah.
Student debt in the UK has soared to more than £100bn for the first time ever, making the amount of money UK students pay for a university education hit the headlines once again.
National student loan debts have increased by 16.6% since last year, from £89.3bn to £100.5bn, according to the Student Loans Company.
While it doesn’t mean your individual debt repayments will increase (that is, if you’ve already graduated from a £9k a year degree), it’s not good news for the government.
As the majority of students will never pay off their full loan in the 30 years after they graduate (after that time, your debt is wiped), this 16.6% jump in debt owed in just one year, shows that this number is only going to go up.
But why has the national debt gone up so much, and so quickly? Well, it’s all down to the rules introduced in 2012 that allowed universities to charge £9k a year in tuition fees. In 2012, student debt was less than half it is now - at £45.9bn - so it makes sense that the figure has jumped so drastically in five years.
Sebastian Burnside, senior economist at Natwest, told the Guardian that debt is likely to double AGAIN to £200bn in the next six years: “These latest figures show student debt is becoming of greater priority with every passing year. Student debt is the fastest growing type of borrowing and is rapidly becoming economically significant.”
He also said it was “unclear what the longer-term implications of rising student debts in the UK would be".
“We don’t yet know how graduates will respond, how it will affect their attitudes to pensions, savings, buying a house.”
But, for the moment at least, it's not going to affect current students and graduates. But as this figure is set to keep rising, it does mean the government has some serious thinking to do - as student debt is now higher than the nation’s credit card debt. Acccck.
For more information on how your student loan repayment works, click here.
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