This is the copy of an open letter that I am sending to my MP about Student loans. Please use as a template and write to your MP if you feel as strongly about this subject as I do.
150A West Wycombe Road
26th May 2016
Dear Mr Baker
The Student Loan Debacle
This is an open letter to you as my Member of Parliament. I would greatly value your support and I have no doubt, so would the thousands of young graduates, like my children.
My children took out student loans at the age of eighteen to study their chosen subjects at the Universities of Aberdeen and Falmouth. Whilst they were undergraduates, fees were increased in the UK to £9,000 per year, from £3,000 – a huge hike in student fees. When they took out their student loans, they were told the loans were at a very low interest rate, and at the time that was around 0.5%.
They were still in the Sixth Form at school, when they agreed to their student loans. They had no experience of loans, credit cards or mortgages. Like all the other thousands of students in the UK, they trusted the Government that the interest rate would remain low - at around 0.5%.
They have both graduated with huge debts in the tens of thousands. However they have just learned, the underhand way, that the Government have sold their loans to a private company, which has caused the interest rates to skyrocket. At no point were they consulted about this, and of course they would never have agreed to this enormous increase in fees.
Now graduates, they feel they have been cheated by a government who encouraged them to undertake higher education, despite trebling the cost of attending university.
The current interest rate is now around 3.9%. They were told their loans would remain around 0.5% interest. In fact the current interest rate is greater than many mortgage companies are charging when people buy a house and their loans are likely to double, year on year, with the additional interest that they will be charged. Graduates will need to be earning in excess of £40,000 pa to keep pace - I believe a really top notch starting salary for an average graduate is about £25,000 pa - and don't get me started on the number of companies that are insisting on graduates working for nothing in internships, or we'll be here all day and night.
I feel they have been mis-sold the loan. A commercial firm would not be allowed to buy loans from another company and then hike the interest rates. This is not what they and thousands of others signed up to. How can this be allowed? How can their loan agreements be altered without their prior knowledge or permission.
This is a disgraceful act by a government which encouraged them, when at school, to go on to higher education – helped by a government loan with the promise of a low interest repayment scheme. Along with many of their former university colleagues - and their Parents - they have lost their trust in this Government.
Their contract was with the government and they were not asked to make a new contract with the private company, which I believe is unlawful.
They should refuse to pay this loan, as they have no contract with the new company, but the repayments are deducted at source, before any salary is paid out, so they have no choice - which I suspect may also be unlawful? I appreciate that they agreed to this when the original loan was taken out, but since the contractural arrangements have changed, without their express permission, I think this should be properly examined.
They have been told that, as graduates, they are the future leaders of the country in politics, engineering and commerce. I hope and believe that when their generation reaches parliament, our future government is never so short sighted as to treat their “future leaders” in such an underhand way.
Mr Baker, I am putting this to you, in the hope you will be able to bring some pressure to bear on the outrageous situation this government has now left them and their generation in, due to the unacceptable hike in interest on their already large student loans and without their prior knowledge. This is not the way to keep our future leaders’ trust……..or votes.
I was one of the lucky ones, as I graduated five years ago and was given a full grant. As my earnings are meagre, this was highly beneficial for me but many mature graduates would have the means to pay for their tuition. It is criminal that our young people are starting out their lives saddled with debts of up to double their starting salary and likely to double, year on year, because the interest rates have hiked without their permission or agreement. I look forward to hearing from you and I value your support.
Sue Ing-Simmons FDA Interior Design
The Rt Hon David Cameron MP.
10 Downing Street
The Rt Hon Jeremy Corbyn
Leader of the Parliamentary Labour Party
House of Commons
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