A parliamentary inquiry into England’s student loan system commenced on Tuesday, as new research reveals a significant rise in public skepticism, with one-third of people now questioning the value of a university degree. The Treasury Select Committee of MPs will hear evidence from student organizations and experts regarding graduate debt and interest rates, coinciding with the British Social Attitudes survey’s findings that 34% of people in 2025 believe a degree is “just isn’t worth the amount of time and money.” This marks the highest level of concern in two decades, with a notable decline in those who feel university leaves graduates “a lot better off” long-term.
Rising Doubts on Degree Value
The British Social Attitudes survey, a long-standing tracker of public opinion, shows a stark shift in perception regarding higher education. In 2005, only 14% of individuals questioned the worth of a university education in terms of time and money. By 2025, this figure has more than doubled to 34%. Concurrently, the proportion of people who believe a degree provides significant long-term financial benefits has fallen from 50% in 2005 to 36% in 2025.
Graduate Debt Burdens and Loan System Scrutiny
Against this backdrop of public unease, the Treasury Select Committee’s inquiry aims to address the financial pressures faced by graduates, particularly those who took out Plan 2 loans between 2012 and 2023. Many graduates report being unaware of the full terms of their loans when they enrolled, leading to escalating debt. For instance, one graduate, Gemma, who pursued a degree in 2016, saw her initial debt of £34,105 grow to £41,908 due to accumulating interest outpacing her repayments. Despite acknowledging her degree’s role in securing a well-paying job, she described the loan as “draining” and “like climbing a mountain.”
Impact on Life Choices
The financial strain of student loans is influencing significant life decisions for graduates. Gemma, now 33, stated that the ongoing debt has contributed to her decision to postpone starting a family, as interest continues to accrue even during unpaid maternity leave. The current system dictates that graduates repay 9% of their earnings above a threshold, which is set to be frozen at £29,385 from April 2027 for three years. This freeze means more graduates will enter the repayment phase earlier, a move criticized by the National Union of Students (NUS) and campaign group Rethink Repayment as contrary to the original loan terms.
Student Organizations’ Demands
The NUS is advocating for a review of the graduate earnings repayment threshold and interest rates. Alex Stanley from the NUS emphasized the need for a longer-term “course correction” to prevent a generation from facing obstacles in home ownership and family planning. More than 50,000 individuals have submitted written evidence to the MPs’ inquiry, highlighting widespread concerns about the student loan system.
Government’s Defense and Universities’ Perspective
The government has defended the freeze on the repayment threshold, stating that the current student loan system protects lower-earning graduates, with repayments linked to earnings and loans written off after 30 years. A government statement acknowledged graduate concerns and highlighted actions such as raising the graduate repayment threshold in 2021 and reintroducing targeted maintenance loans. Vivienne Stern MBE, Chief Executive of Universities UK, acknowledged the challenging labor market but pointed to data indicating that graduates are still more likely to be employed, earn more, and have better health outcomes. She stressed that a university education benefits both individuals and the nation’s economic growth.
Looking Ahead
As the inquiry progresses, attention will focus on whether policy adjustments will be made to the repayment threshold, interest rates, and the overall transparency of student loan terms. The long-term implications for graduate financial well-being, social mobility, and the perceived value of higher education in the UK remain key areas to watch.
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