I agree, and I will make that point shortly. This is not only a graduate issue, but a fiscal time bomb. In 2024-25, write-offs recorded in Department for Education accounts rose to £310 million, up from £121 million the year before. The longer this system continues without reform, the more unstable it becomes for borrowers and Governments alike, and then where is the ambition? Every pound earned above the threshold attracts a 9% deduction, on top of existing taxes. The marginal deduction rate that many middle earners face is far higher than the headline rate suggests. Perception shapes behaviour. If progression feels like it is punished, and if promotion feels like a heavy deduction rather than a reward, morale suffers.
This generation did what we asked of them—they studied, trained and qualified—but many feel let down and misled. So what must change? Not the principle of contribution, because their education has to be paid for, but the fairness of the design. The Minister and the Government urgently need to reconsider the following, and I hope hon. Friends will add to this list: first, whether freezing thresholds is justified in a cost of living crisis; secondly, whether to raise the threshold to alleviate hardship and make the system fairer; thirdly, whether RPI remains an appropriate benchmark for interest calculations; and fourthly, whether a 9% repayment rate disproportionately affects middle earners and should be reduced.
Perhaps it should be a combination of all of the above, because tinkering at the edges will not suffice. Neither will knee-jerk reactions: some of the proposals I have heard, such as cutting the interest rate without addressing the structural flaws, offers only headlines, not solutions. Those who designed the system cannot now pretend they bear no responsibility for its consequences, when they had 12 years to get it right. Equally, suggesting we cut certain courses, as some have suggested, simply because the graduates on those courses repay less, confuses economic return with social value.