New Debt and Repayment Scheme Totals €25,000 for Graduating Students

The Department of Education has recently proposed a new scheme designed to get students in school at higher rates. The increase of students in universities in the United Kingdom is already expected to rise by 30%, with these extra students needing to find financial aid in order to pay for fees and tuition. This amount of money is supposed to be taken on by the student or the family of the student, but the Department of Education’s new plan would put the cost of going to school in the future, after students have finished their studies. Specifically, the debt which be run up would not have to be paid until the graduate finds a job at an adequate income level. Then, and only then, would the student be expected to repay the amount of money that he or she owes.

The average amount of the debt has been calculated at €25,000 per student. This number has been averaged out for specific majors as well. For example, the former minister for education, Batt O’Keeffe, started this plan as a sort of study now - pay later idea. Those who finished a degree in teaching would have a debt of around €21,000 to pay after graduation. Nursing students would have to pay down a debt load of approximately €23,000 after graduation and procurement of an adequate job. Those who took degrees in the field of engineering would have to pay back a debt load of around €31,000 in total.

The idea for this scheme came from main recommendations from the Hunt report which was published recently on higher education. The entire project will be run by the European Investment Bank, the National Treasury Management Agency, or the large list of British companies which specialize in these types of education plans.

Other sources said that the smallest amount of debt which could be taken on would actually be €25,000 which shows the increased price due to interest rates. That means that most graduates would take 10 years to pay off their debts, if they were paid back at standard rates. These fees associated with the loans which would be used to pay tuition and fees of at least €5,000 per year, and they would be repayable through a higher tax once the student got a job that allowed for repayment.

The Minister for Education, Mary Coughlan, mentioned that she did not intend for students to be hit with large debt loads. The actual situation, she insisted, is that students should be grateful for the opportunity to pick up increased education and expertise with the assistance of the government. Thus, students should make a significant contribution to the cost of their educations. Fine Gael has already supported the graduate tax; Labour is against additional fees for students, but it agrees with new ideas for new student loan schemes which do not have any upfront fees. The hope is that the new scheme will find widespread support from each party involved.