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Students: Loans

Original answer

Interest rates on student loans have been consistently linked to a widely recognised and adopted measure of inflation. Interest rates are set in legislation in reference to the Retail Price Index (RPI) from the previous March and are applied annually on 1 September until 31 August.

The Office for National Statistics has undertaken a substantial programme of work over the past two years to enhance how inflation is measured and this will be carried over into student loans. The Office for Budget Responsibility has confirmed that from 2030 (at the earliest), movements in RPI will be aligned with The Consumer Prices Index as viewed here: https://obr.uk/box/the-long-run-difference-between-rpi-and-cpi-inflation/.

The answer was corrected by Josh MacAlister (Labour)

on Friday, 10 April 2026 on behalf of the Department for Education.

Corrected answer

Interest rates on student loans have been consistently linked to a widely recognised and adopted measure of inflation. Interest rates are set in legislation in reference to the Retail Price Index (RPI) from the previous March and are applied annually on 1 September until 31 August.

The Office for National Statistics has undertaken a substantial programme of work over the past two years to enhance how inflation is measured and this will be carried over into student loans. The Office for Budget Responsibility has confirmed that from 2030 (at the earliest), movements in RPI will be aligned with The Consumer Prices Index, including owner occupiers' housing costs as viewed here: https://obr.uk/box/the-long-run-difference-between-rpi-and-cpi-inflation/.

Secondary information

Type

Written question

Reference

113204

Session

2024-26

Subjects

Interest rates Loans Students

Link

View this Written question on www.parliament.uk