The Government has announced in the Budget Bill for 2022 that the interest rate on student loans should be reformed and that the Government intends to return to the Budget Bill for 2023 with a proposal for a reformed model for the interest rate on student loans in light of the introduction of a new adjustment student support from 2023.
SFS supports the new adjustment study support that is being introduced, but takes the risk of displacement effects for other students very seriously. With a changed interest rate model for student loans, the interest rate will increase.
The fact that more individuals are given the opportunity to study in the middle of their lives to strengthen their position in the labor market is, of course, fundamentally positive. In addition to the benefits for society and the individual this means, we believe that it also provides opportunities for a broader recruitment to higher education where people who without the adjustment study support would not have studied, now get that opportunity. Among other things, with this potential broadened recruitment in mind, it is crucial that the adjustment study support is not introduced at the expense of other student groups.
In our consultation response to the government, we show how the new proposal will not guarantee reduced expenditures for the state at all, how higher interest rates on student loans make borrowers more sensitive to socio-economic development and how the proposal goes against key parts of the basic funding system. The government's proposal came in the autumn of 2021, in a different economic situation. How would the interest rates on student loans be affected in an even worse situation? We discuss this and much more in our consultation response.