Student loan debt might be putting people off having children, Kemi Badenoch has said.
The Conservative leader described it as a “huge burden” that left many graduates unable to feel financially secure – which may put them off starting a family.
In an interview with The Independent, she also revealed that if she had had to take out similar loans for her education she would have been left with debt of £100,000 – which would take her “forever” to pay off – and might have struggled to buy her first flat, a move that led to her meeting her husband.
She also talked of her concerns for the future for her own children, including one who will be 18 in five years, as she set out her party’s policy to slash the interest rate on the loans.
Her warning comes a year after the education secretary Bridget Phillipson said Britons should consider having more children and at an earlier age, as she said they were being put off by the high costs of living,
Ms Badenoch said if she had taken out what is known as a ‘Plan 2’ student loan – which students who attended university between 2012 and 2023 took out – her debt would probably be around £100,000.
She said she would have come out with “about £80,000… and the debt would probably be about £100,000 now on current interest rates. I think that’s quite wrong.”
Asked how long it might have taken her to pay off, she said: “Well, probably forever, because I think psychologically, the idea of just constantly having this thing like a millstone around my neck would have been quite heavy.
“But also, I got a mortgage when I was 27 on a flat – I probably would not have been able to do that with the way that the interest payments on loans are working right now.
“So I might not have got my first flat. That might have been harder. I met my husband, who lived near me, with that first flat. I might not have even met the person that I was with. I mean, obviously that’s a personal experience. But I think that having debt is actually a very heavy thing for people to carry.”
Asked if she thought it was affecting the country’s birth rate, she said: “I wouldn’t be surprised if indirectly it is affecting people’s timing in terms of starting a family.
“Most people don’t want to start a family until they feel financially secure, and this is one of the things that I think is creating a huge burden for a lot of young people.”
She said she kept “putting myself in the shoes of what a 26 or 27 year old today is dealing with”.
“I don’t think it’s fair. But now I also have three children of my own. My oldest is going to be 13, and I started thinking, well, in five years time, she’s going to be 18, what kind of courses will be available? What’s AI going to do? I’m thinking very much about the future, and I want people to know that if we just keep focusing on what happened yesterday, we’re never going to be able to give a better future for young people.”
She added: “I had a student loan. It took me about eight years to pay it off. To think that I could still be paying it now and it not getting smaller, would be absolutely horrendous. So I want to see change in the system.”
Interest on Plan 2 loans is charged at the rate of RPI (retail prices index) inflation plus up to 3 per cent, depending on how much a graduate earns. Following Rachel Reeves’s November budget, the salary threshold at which repayments kick in under the Plan 2 system is set to be frozen for three years, leading to some people having to pay more.
There are widespread concerns around the costs of the loans, with pressure piling on the Treasury to find a way to lower the costs for graduates.
The Conservatives have announced plans to restrict this to RPI only. Ms Badenoch said her party would pay for the policy by shifting money from courses offering “very very poor value” for young people, many of which she said should not be degrees at all but should be apprenticeships.
She gave examples of clock making and floral arrangement courses.
“It’s basically courses which, actually, you don’t need a degree to do the thing. One example that I heard today was horology, which is clock making. That is not a degree level course,” she said.
“You should be doing an apprenticeship to learn about clocks. You don’t need a three year degree and writing essays to do that. Floral arrangement… I mean, they make the golf studies look actually quite cerebral. These are not university degrees.”
She added: “Lots of people think we’re talking about arts versus sciences. It’s not that. It is actual technical things, skills, which don’t need £9,000 pounds a year to learn, and people taking out debts that they will never be able to pay back. It’s not fair on the students. It’s also not fair on the taxpayer, because many of the students will never be able to pay back those loans so the taxpayer has to pay. That’s not right.”
She also said she would “debate” Martin Lewis, the money saving expert, on the issue after he gatecrashed a TV interview she gave on her plans.
“He is looking, I think, at how do we make repayments easier, “ she said. “I’m looking at the whole system, and where are the areas that need change.”
A government spokesperson said: “We inherited the student loans system, including Plan 2, which was devised by the previous government. Threshold freezes have been introduced to protect taxpayers and students now, alongside future generations of learners and workers.
“The student finance system protects lower-earning graduates, with repayments determined by incomes and outstanding loans and interest being cancelled at the end of repayment terms.”
