A group of graduates dressed as sharks said they were “drowning” under the weight of their student debt, accusing the government of acting like “loan sharks” as they protested against the student loan system outside parliament.
Organised by the National Union of Students (NUS), the demonstration outside the Houses of Parliament on Wednesday came as student loans, particularly “Plan Two” loans and the interest added to them, have faced increasing scrutiny.
The protesters, wearing masks of chancellor Rachel Reeves as well as their shark suits, demanded an end to the freeze on repayment thresholds announced in the last Budget, as well as calling for a cap on those repayments and the beginning of a wider conversation on interest rates.
Instead of rising with inflation each year, the repayment threshold, which is set to rise to £29,385 in April 2026, will be frozen for three years. Graduates begin repaying nine per cent of their income above this threshold.
The freeze means more graduates will start making repayments as they are dragged over the threshold earlier than they would have been if it was rising with inflation.
Martin Lewis criticised the freeze but Ms Reeves defended the overall student loan system as “fair and reasonable”.
At the protest, NUS president and Birmingham University graduate Amira Campbell, 24, said she now owes more than £50,000 of student debt and described the situation as a crisis that the “country has sleepwalked into”.
She told The Independent: “We’ve got young people who are 17 or 18 years old told by their parents, their schools, their government that they should go to university, that they should upskill and become part of the workforce of this country.
“Then they’ve gone to university, come out the other end and they’re struggling to get a job. They can’t get on the housing market. They’re wanting to start families, but they simply cannot afford to.
“Meanwhile, they watch money from their bank account leave every single month into these student loans that they had no choice but to take on.”
About the nature of the protest, she added: “We believe that the government are being a bit of a loan shark when it comes to student loans.”
Alex Stanley, 23, who graduated from the University of Exeter in 2023, said the current system means “young people are being punished for their ambition.”
He told The Independent: “I borrowed £50,000 and I’m now in £62,000 of debt. £7,000 of that was accrued whilst I was still a student.
“It’s a complete scandal of a system. When the Tories trebled tuition fees back in the previous government, they gave young people the assurance that they’d never really have to look at that debt at all. It wasn’t something that was real in many ways.
“But the reality is that that’s a promise that’s now been broken.”
The loan system is weighted against those whose parents cannot pay for their fees up front, Alex said, as interest rates mean the longer it takes to clear your debt, the more you have to pay.
While an undergraduate is studying, interest will be added to their loan at the rate of retail price index (RPI) inflation, plus three per cent. Once they graduate, interest is added at RPI inflation rate, plus up to three per cent depending on how much the graduate is earning.
The graduates said the repayments they have been able to make are paltry in comparison with the interest being added to their debt.
“It is a very regressive system”, Alex said. “It’s important that you note that a lot of people are having this conversation as if it’s a graduate tax.
“But it’s actually only a graduate tax for the majority of us, the middle of us, because the very wealthiest can afford to pay their way out of the system as if it was a sort of one-time bill. The rest of us are left in a system with spiralling debt where the burden on them is ever increasing.”
About that “burden”, Alex said the debt prohibits graduates from building their lives and limits their ability to plan for the future.
“Well, the reality is that it feels like we’re drowning”, he explained. “I’m in £62,000 of debt. That’s £12,000 more than I expected. And that’s the case for so many young people. The average graduate is in £53,000 of debt.
“We’re talking about a generation of people who are already struggling to put down a mortgage for a home, struggling to start a family.
“And that’s before we even start talking about those struggling to pay their rent and bills. All this is doing is adding to that ever-increasing burden of debt.”
A government spokesperson said: “We recognise the concerns among borrowers. The student loans system was designed and implemented by previous governments. We’re making the tough but fair decisions needed to protect taxpayers and students now and for future generations of students and workers.
“We have set an ambitious target of two-thirds of young people studying degrees or gold-standard apprenticeships by the age of 25 and we are supporting students with the cost of university by increasing maintenance loans every year in-line with forecast inflation and reintroducing targeted maintenance grants.
“The student finance system is heavily subsidised by government, and lower-earning graduates will always be protected, with any outstanding loan and interest cancelled at the end of the repayment term.
“It is right that those who are able to repay do so and under this system, where repayments are determined by income not total borrowed, graduates earning some of the highest salaries in the country contribute more towards the repayment of their student loan than workers who did not attend university or graduates on the lowest salaries.”
Source: UK Politics - www.independent.co.uk
