Student loans row

Why is Martin Lewis clashing with Rachel Reeves over changes?

- Rupert Jones

A fairly technical-sounding change to student loans in November’s budget has become the catalyst for a row pitting the UK consumer champion Martin Lewis against the chancellor, Rachel Reeves.

In one interview, Lewis - the founder of MoneySavingExpert.com - said he did not think the planned change to repayment terms “was a moral thing”.

Reeves has defended herself and insisted the system is fair, but with Lewis all but demanding that millions of graduates rise up and write letters to their MPs to say “this isn’t on”, this bust-up looks set to snowball further.

The disagreement is focused on the estimated 5.8 million graduates who took out a student loan between September 2012 and July 2023. For many, everything they hand over from their salary is dwarfed by the interest that is slapped on their debt every month.

Reeves’s decision to freeze the salary threshold for repayments for “plan 2” student loans for three years means many graduates will now have to pay even more towards their student loans.