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Student Loans for Higher Education statistics
30/07/2009
Official statistics on repayment of income contingent student loans are today published jointly by the Scotland's Chief Statistician and the Student Loans Company (SLC). Income contingent student loans are those where repayments are linked to a borrower's income after they leave university or college. Repayments are generally made through the tax system.
Key findings include:
- Generally, the older the repayment group, the higher the percentage who have fully repaid their loans. As of the June 30, 2009, 18 per cent of the 2000 cohort had fully repaid their loans, after nine years of repayment liability - compared to only three per cent of the latest entry cohort (2009).
- For the latest cohort year at which full repayment status information is available (2007) 28 per cent were in employment and had made at least one repayment during tax year 200-08. A further 35 per cent were employed but below the £15,000 earnings threshold for repayment.
- 21 per cent of the 2007 cohort year were not repaying any loans in tax year 2007-08 as their residence and (or) employment status had not yet been determined.
- The average amount repaid by each borrower through the tax system in the tax year 2007-08 ranged from £390 for the 2007 cohort in its first year of repayment to £610 for both the 2003 and 2004 cohorts, after four/five years of repayment liability. The total amount repaid via the tax system by the 2007 cohort in tax year 2007-08 was £4.2 million.
- The average debt for borrowers who still had a live account at the end of tax year 2007-08 ranged from £5,300 for the 2000 cohort, after eight years of repayment liability to £7,480 for the 2004 cohort, after four years of repayment liability. The 2007 cohort had an average debt of £6,850.
This release follows on from the statistical first release Student Loans for Higher Education in Scotland Financial Year 2008-09 which was published in June. Today's publication provides additional analysis of the repayment statistics for income contingent loans - i.e. loans available to student since the academic year 1998-99 where repayments are linked to income after leaving college or university. Fixed term loans (known as mortgage style loans) are not included. The breakdown by cohort year groups borrowers according to the year in which their first income contingent loan became liable for repayment.
The June release showed the position as at March 31, 2009. However, the data held by the Student Loans Company at that time for repayments via HMRC represent mostly the effect of repayments in tax year 2007-08. As backdated information can be received from HMRC, the data posted by SLC for one financial year can end up covering multiple tax years. The purpose of these new statistics is to illustrate, for each tax year, the changes in repayments and outstanding debt from the point of view of borrowers themselves and to give their repayment status at the end of the tax year 2007-08. This release shows the position as at June 30, 2009.
This publication relates to Scottish domiciled higher education students and EU domiciled higher education students studying in Scotland. Higher education refers to any qualification at HNC/HND level or above.
The average repayment amount dropped for all repayment cohorts except the 2004 cohort between tax year 2004-05 and 2005-06 due to the increase, from £10,000 to £15,000, in the income threshold at which repayments begin.
The average outstanding debt for each repayment cohort has increased year on year. Interest added to the balance in the early years of repayment has tended to outweigh the repayments made and many of the borrowers have gone on to take out further loans after their initial loans became liable for repayment.