Paying back student loans UK Great Britain

February 6, 2016
The student loan repayment

In an ideal world, there is everything to be gained by students from the rest of Europe coming to British universities to study: it is a mutually beneficial process. Certainly, the huge popularity of British universities among talented, high-paying students from the rest of the world has proved a great boon. But in a fiercely competitive undergraduate environment, the swelling numbers from the EU could create discontent. This will be exacerbated by the fact that they can take full advantage of the student loan system.

And here is where unfairness could creep in. According to the Student Loans Company, EU student debt has quadrupled from £42 million in 2008 to £167 million last year. That is expected to worsen. According to the Higher Education Policy Unit, it is likely that many EU students will never pay back their UK loans. Not only is it near-impossible to enforce British tax laws in a foreign jurisdiction, but many EU countries are far poorer than the UK and salaries are lower, meaning that many graduates will never hit the £21, 000-a-year threshold at which repayment of the loans kicks in.

This threatens to stoke up ill-feeling. Not only will EU students be denying British students university places; many of them won't have to pay for it. We should be wary of such a development. In the past, extremist parties have exploited the concerns of those working-class Britons who resent it when people coming to this country from EU member states appear to receive preferential treatment in council housing allocation. There appears to be no hard statistical (though some anecdotal) evidence that such bias actually exists, but that hardly matters, because many people stranded on housing waiting lists believe that it does, and that is what fuels the resentment. It is vital such attitudes do not take hold in higher education. So far, ministers have had little to say about this emerging problem. It is time they paid it serious attention.

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