Today the government sold student loans worth Â£ 900million to a private debt collector for the bargain price of Â£ 160million, in a deal that includes all student loans taken out before 1998.
But this outrageous move is likely to be right around one of the âGreat Student Loan Giveawaysâ.
In today’s story, the government is casting doubt on it by saying it is âlooking at optionsâ on a future sale of the Income-Conditional Repayment Loan (ICR) portfolio. These are all student loans taken out since 1998.
In fact, the government is likely to do much more than ‘consider’ the privatization of all student loans, if Danny Alexander, the Chief Secretary of the Treasury, declaration to parliament in june of this year is something to pass.
He said: “We will take steps to sell Â£ 15bn in public assets by 2020. Â£ 10bn of this money will come from corporate and financial assets like the student loan portfolio.”
The fight to stop the liquidation of student debt will therefore intensify.
Anger over the government’s plan to privatize the student loan portfolio is already growing on campuses. Last week on Student assembly against austerity
organized a day of action which saw a wave of protest on more than 25 campuses.
Student anger at the proposals is fueled by fears that shifting our student debt to private companies could lead to increased financial burdens on students and graduates, as the new owners of the debt increase rates of debt. interest in order to make more profit.
These concerns are well placed. Like a secret report for the government revealed, in order to ensure that the student loan portfolio is profitable for private companies, the repayment interest limit should be increased or removed as a whole. Frankly speaking, this proposal would skyrocket student debt and represent a retrospective increase in tuition fees.
As Conservative Universities Minister David Willetts, a small parliamentary committee last June, it is very easy to increase the interest rate: âIn the letter that each student receives, there are words to the effect that governments reserve the right to modify the conditions of the loans.
In light of this, David Willetts’ assurances that the terms and conditions of our student loans will not be changed as a result of the privatization of the student loan book ring hollow.
We are determined to create a mass campus movement across the UK to stop the government in its tracks. The Student Assembly Against Austerity is coordinating a major national week of action in February next year to make the government think twice and rule out any further privatization of the student loan portfolio.