Just 30% of graduates will pay off their student loans

SEVEN in ten graduates in England will never repay all of their student debt – a higher proportion than in many other major economies.

This is because most students take on the full £9,250-a-year tuition fee loans but do not have to pay back much of the money until they are earning well, an analysis in ten countries has found.

All debts are wiped after 30 years so those who have only been low or middle earners all their lives will not have had to repay the full amount.

However, this has a big impact on the public purse as the unpaid money is made up with taxpayers’ cash.

The data by the international economic organisation the OECD found that between 40 per cent and 45 per cent of the value of loans in England will never be repaid.

In the Netherlands, 15 per cent of students never repay their debt, while in Sweden it is only 1.5 per cent.

England also has the second highest tuition fees of the ten countries – the highest being in the US. But the report states that the high fees in this country are offset by a ‘well-developed’ system of financial support for students.

For those who started university after 2012, nine per cent of earnings over £ 25,000 are repaid to funding body the Student Loans Company.

Despite the large fees, UK universities are still very attractive to foreign students.

The UK takes in 14 per cent of all international students across OECD countries – the second highest after the US, with 43 per cent of them in doctoral or equivalent programmes.

The teaching workforce in the UK is also one of the youngest among all OECD countries. In primary schools, 31 per cent of teachers are aged 30 or under, compared to the average of 12 per cent. The UK average age for graduates is 23, the lowest of all countries.

Education Secretary Damian Hinds said: ‘I have been clear that I want to see a world-class education for every child, whatever their background ... As the report recognises, we have high levels of young people in education or employment, the financial gains from going to university outstrip the cost and people are more likely to continue learning throughout their lives.’

‘University gains outstrip the cost’