Overview
- Citing Tuesday's Commons Treasury Committee evidence, Sir Phillip Augar called changing Plan 2 loan terms a "moral issue" and likened the situation to the PPI mis‑selling that led to mass compensation.
- The government froze the Plan 2 repayment threshold at £29,385 for three years from April 2027 and has said it will cap maximum interest at 6% from September to limit costs for graduates.
- Independent analysis from London Economics and IFS researchers shows the 2022 and 2025 changes raise lifetime repayments for many middle and lower earners, with a 2022/23 cohort earning £40,000 facing about £740 more by 2032 under recent rules.
- Experts and witnesses at the hearing disagreed on oversight, with Augar arguing for a duty of customer care and others, including Universities UK, saying the Financial Conduct Authority may not be the right regulator for state-backed loans.
- Public trust has fallen sharply as a result, with the British Social Attitudes survey reporting a record 34% saying university is not worth it, and commentators warn the row could prompt demands for greater transparency, regulatory action, or retrospective redress.