The average female student who started university in 2023 will pay back £10,000 more over their lifetime as a result of recent changes to England’s loan repayment system, new research has found.
In contrast, male students starting a full-time undergraduate degree this year will benefit from the reforms, paying back on average £7,500 less than under the previous system, according to modelling by consultancy London Economics for the Nuffield Foundation charity.
The Financial Times has built a tool to show how much you will repay depending on your lifetime earnings.
The UK government introduced new rules in September 2023 that extended the repayment window from 30 years to 40 years, cut the minimum salary for repayments from £27,295 to £25,000, and slowed the rate at which the threshold increases.
Women are disproportionately affected by these changes as career breaks and job choices result in lower average lifetime earnings. Meanwhile, men are more likely to be high earners and so benefit from the government’s decision to reduce the interest rate on loans.
Under the new system, all but the lowest earners pay back a similar amount — between £54,000 and £56,000 — but this means middle earners like teachers and nurses will pay a larger share of their income than those on the highest salaries.
A woman in the middle of the income distribution pays 3.1 per cent of her lifetime income over the repayment period, five times the proportion paid by the top 10 per cent of male graduates.
