What is changing for students in England
Under the new tuition fee system starting in the 2012 academic year, universities in England will be able to charge students up to £9,000 in tuition fees, according to BBC reporting. The money is to be advanced by the government, and repayment begins after the student graduates, finds work, and reaches an annual income of £21,000.
Beyond tuition, students can also apply for a living-cost loan of between £3,575 and £5,288 depending on family circumstances.
What could borrowers actually repay?
BBC commissioned several well-known accounting firms to calculate a number of hypothetical student borrowing and repayment scenarios. In all of those scenarios, the hypothetical students borrowed three years of tuition at £9,000 a year plus £4,000 a year for living costs, for a total of £39,000.
The first hypothetical student was assumed to start on an average annual salary and receive a £1,000 pay rise each year. According to figures calculated by accounting firms including Baker Tilly for BBC television, the total amount repaid over time could reach £83,000.
A caveat attached to those figures: they do not take into account changes in the real value of money after inflation. Even so, the numbers offer a glimpse of what student loans can cost.
Where the pressure is coming from
The new tuition fee policy has triggered several student protests and demonstrations. The gap between what is borrowed and what is repaid is at the centre of the debate.
FAQ
How much can universities in England charge under the new system? Universities will be able to charge students in England up to £9,000 in tuition fees under the new system that begins in the 2012 academic year.
When does repayment start? Repayment starts after the student graduates and finds work, and once their income reaches £21,000 a year.
How much living-cost loan can a student apply for? A student can apply for a living-cost loan of £3,575 to £5,288 depending on family circumstances.
Could a student borrow £39,000 and repay £83,000? Yes, according to calculations by accounting firms commissioned by the BBC, a hypothetical student who borrowed £39,000 could face a total repayment of £83,000.