Written question asked by Shabana Mahmood (Labour) on Thursday, 27 June 2013, in the House of Commons. It was due for an answer on Monday, 1 July 2013. It was answered by Lord Willetts (Conservative) on Thursday, 4 July 2013 on behalf of the Department for Business, Innovation and Skills.

Students: Loans

Question

To ask the Secretary of State for Business, Innovation and Skills what assessment he has made of the likely effects of the announcement in spending round 2013, Cm 8639, that the resource accounting budget for higher education student loans will increase to £4.4 billion in 2015-16.

[162984]

Answer

The BIS student loan resource accounting budget (RAB) falls outside the ONS definition of PSCB (public sector current budget). The student loan resource accounting budget is used to ensure control over the long-term costs of the student loan book, but does not directly impact the fiscal aggregates.

The resource accounting budget for FY2015-16 of £4.4 billion is not directly comparable with the FY2014-15 baseline figure of £2.9 billion set in 2010, because of changes since 2010 including the following:

macroeconomic conditions, which have increased the RAB charge to around 35%;

increases to repayments thresholds since 2010;

the introduction of further education loans since 2010.

The total outlay on student loans will increase between FY2014-15 and FY2015-16 as a result of a higher proportion of students being eligible for higher fee loans. Decisions have not yet been taken on rates of tuition and maintenance loans in academic year 2015/16.

Secondary information

Type: Written question
Reference: 162984; 565 cc775-6W
Session: 2013-14
Subjects: Higher education Loans Students
Link: View this Written question on www.publications.parliament.uk

Students: Loans

Secondary information

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