Credit, Collections & Insolvency News
The government has begun its sale of the student loan book, which it expects to recoup £12billion The universities minister, Jo Johnson, said the move would have “no impact” on student borrowers paying off loans, as terms and conditions would remain the same after the sale was completed. The sale covers £4 bill ion of loans, which became eligible for repayment between 2002 and 2006. It is the first of a four-year programme of sales of loans issued before 2012, when university tuition fees were raised to £9,000.
Announcing the start of the process in a written statement to parliament on Monday, Johnson said: “This government is committed to bringing public finances under control and returning the budget to balance. As part of this, we will look to sell assets where value for money to the UK taxpayer is assured. This sale will have no impact on people with student loans and will only proceed once we are satisfied that it represents value for money for the taxpayer.”
The sell-off of loans and collections will be administered by the Student Loans Company.
The National Union of Students vice-president Sorana Vieru described the sale as economic illiteracy and warned that it risked beginning a process by which loans would have to be made more attractive to private buyers at the expense of student borrowers. “It is outrageous that bankers will profit off the backs of graduates who took out loans because they had no other option. The government wants to sell our education on the cheap and this is only the first step,” she said.
Sally Hunt, the general secretary of the University and College Union, which represents university workers, said: “The government has tried to sell off parts of the student loan book before, but not gone through with it because it didn’t feel the taxpayer would get a good deal. “You can forgive our scepticism when the minister [Johnson] says people with student debts have nothing to fear.”
