The impact of tuition fees and the student loan system is to be reviewed by an influential committee of MPs.
The Treasury Committee will review changes to the student loan system, including the repayment threshold and interest rates. It will also examine the impact of higher education on public finance.
The announcement comes after universities minister Jo Johnson confirmed that tuition fees will be frozen at £9,250 from next year and that the salary repayment threshold for graduates to start repaying their loans will increase from £21,000 to £25,000.
Nicky Morgan MP, former education minister and chair of the Treasury Committee, said: “Student loan debt is projected to be around £160bn within six years, and the government has announced that it will review the whole student finance system. The committee will scrutinise the current system and any future developments closely.”
Prime Minister Theresa May first announced the plans earlier this month at the Conservative Party conference, as she pledged to “look again” at student finance.
She said: “We know that the cost of higher education is a worry, which is why we are pledging to help students with an immediate freeze in maximum fee levels and by increasing the amount graduates can earn before they start paying their fees back, amounting to a saving of £360 a year, while the Government looks again at the question of funding and student finance.”
The UK’s leading universities have welcomed the move.
Tim Bradshaw, acting director of the Russell Group, which represents 24 leading universities including the following London universities: LSE, UCL, Imperial, King’s College London and Queen Mary University, said: “We need a system of student finance that is fair for students, the taxpayer and for universities too.
“The announcement of an increase in the student loan repayment threshold was a positive move that will help recent graduates.
“I have previously called for the interest rate attached to student loans to be looked at again and am pleased that this will be considered by the committee.”