Plan 2 loans apply to students who started courses in England and Wales between September 2012 and July 2023.
Graduates from Northern Ireland will not be impacted by the UK Government’s freeze on the student loan repayment threshold, the Economy Minister has confirmed.
In the Autumn Budget, Chancellor Rachel Reeves announced the salary at which Plan 2 student loans must be paid back would be frozen at £29,385 for three years starting from April 2027.
Plan 2 loans apply to students who started courses in England and Wales between September 2012 and July 2023.
The repayment threshold is currently £28,470 for this plan, and a freeze would mean those earning above that amount will be making larger repayments on their student loans than if the thresholds had risen in line with inflation.
Graduates repay nine per cent of the amount earned above the threshold outlined in their plan, and Plan 2 loans are charged a rate of interest equal to Retail Prices Index inflation, plus up to 3 per cent on top based on earnings.
Responding to a question from the SDLP’s Sinéad McLaughlin, Economy Minister Dr Caoimhe Archibald said: “The policy in respect of student loan repayment is a devolved matter. I can confirm that the proposal to freeze repayment thresholds in England will not apply to borrowers from here.
“The repayment threshold here will see an inflationary increase from £26,095 to £26,900 in April 2026.”
SDLP Opposition Economy Spokesperson Sinéad McLaughlin MLA said: “Graduates across the water have been hit hard by the Chancellor’s decision to freeze repayment thresholds. I welcome the Minister’s commitment here not to follow suit with this damaging approach.
“Yet the impact of student debt still hangs over the heads of too many graduates. We need a university system that is fit for the future, one that properly invests in our universities and fully supports students.
“In that context, it is disappointing that the Minister’s higher education funding review will not conclude before the end of the mandate, effectively passing the buck on big decisions to a future Economy Minister. We need much more ambition and a better approach from the Executive, to ensure every young person has the fair future they deserve.”
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