Several universities in England have only been using below-average salaries in online examples of student-loan repayments, a BBC investigation found, the BBC reported. Dame Meg Hillier, who chairs the Treasury Committee and led a recent inquiry into student loans, said some of the information was "misleading," including one comparison to the "cost of a daily coffee." She said the Department for Education must also include higher-salary examples on its own website. The department said it would review the information it provides, and universities said their sites referred to government material and would be reviewed where necessary.
Student loan repayments in England are tied to earnings. Current and prospective students take out Plan 5 loans for tuition and living costs and repay 9% of anything they earn over £25,000 for 40 years, or until the loan is paid off. The BBC reviewed more than 110 university websites and found inaccurate information about the salary at which repayments start and how long they last. It also found that 12 universities only gave worked examples based on earnings below the UK average of £39,039. The University of Gloucestershire, for example, said a £26,000 salary would mean repaying £7.47 a month. Northumbria University and the University of Huddersfield gave examples of £75 monthly repayments on a £35,000 salary. Northumbria's site said those graduates would be "repaying an amount less than the cost of a daily coffee," a comparison removed after the BBC got in touch.
Someone earning £30,000 would repay £37.50 a month, but someone earning £100,000 would repay £562.50. Megan Russon, 21, a recently graduated tax accountant from Cannock on about £29,000, will repay about £30 a month, but expects to earn around £50,000 once she is chartered and then repay about £187. She said universities had told open-day visitors that repayments "should be minimal." "When I was at university, I started realising the salaries that I was going to be on after I graduated, then I started realising actually this is going to be impacting me quite a lot." The BBC listed 12 universities that used only below-average examples, and found other errors: the University of Exeter said Plan 5 loans were written off a decade earlier than they are; Royal Holloway and Edge Hill listed the wrong thresholds; Harper Adams said English students were still on Plan 2 loans. All four have since updated their sites.
Hillier said she was "pretty shocked" and that the DfE should "take the lead" by showing how higher earnings change monthly bills. Her earlier inquiry argued the department had been "mis-selling" Plan 2 loans. Lewis Wilson of the National Union of Students said that "if this was any other financial product, it would have crossed the line into mis-selling." The DfE said its guidance explains how repayments are calculated and that applicants must have "clear and accurate information." The verified finding is a pattern of low-salary examples and some outright errors, now under review, not a change in the repayment rules themselves.