Right now, the student finance system simply isn’t working.

Graduates are paying more, for longer, on terms that keep changing. Repayment thresholds have been frozen. Interest rules have been altered. The repayment period has been extended to 40 years for some borrowers. Successive governments have quietly moved the goalposts, and young people are left picking up the bill.

At a time when rents, mortgages and food bills are rising, graduates are being squeezed even harder.

That’s not fair. And it’s not sustainable.

We know trust has to be rebuilt

The Liberal Democrats paid a heavy political price for making promises on tuition fees we couldn’t keep. We’ve learned from that.

That’s why we are not making unrealistic pledges. We are setting out a pragmatic, costed and achievable plan that would make a real difference to graduates now, while also fixing the system for the long term.

Our plan: Unfreeze repayment thresholds and put money back in your pocket

We would urgently reform the system to reduce monthly repayments by reversing Labour’s freeze on repayment thresholds.

For example:

• A graduate earning £35,000 would see their monthly repayments cut in half within three years.
   
• They would get an immediate boost of around £100 next year.
   
• Over the lifetime of their loan, lower earners could save up to £5,000.

We would achieve this by:

1. Ending the repayment threshold freeze

Instead of freezing the salary level at which you start repaying, we would raise it in line with average earnings, so as wages rise, you keep more of what you earn.

That’s how the system was originally designed. It should never have been constantly undermined by successive Conservative and Labour governments who since 2015 have repeatedly frozen thresholds and changed the terms of people’s loans, meaning graduates are left with soaring bills.

2. Stopping governments from constantly changing the rules

Graduates should not wake up to find the government has changed the terms of their loan.

We would create an independent watchdog to oversee student loan repayment terms, including thresholds, interest rates and repayment conditions, so governments cannot keep moving the goalposts.

Rewarding public service

We also want to recognise people who dedicate their careers to serving our communities.

Under our plans nurses, doctors, teachers, police officers and armed forces personnel could have part of their student loan written off after 10 years of public service.

This would help tackle the recruitment and retention crises in the NHS and schools, while rewarding those who commit to public service.

When experienced staff leave early, it costs taxpayers hundreds of thousands of pounds in training and agency costs. Retaining even a modest number of professionals would save some of this money and strengthen our public services.

Bringing back maintenance grants

The Conservatives scrapped maintenance grants for the poorest students.

We would restore £3,500 a year in maintenance grants for disadvantaged students, so young people from lower-income backgrounds face fewer barriers to go into higher education and graduate with less debt.

Fixing the system for good

Short-term changes aren’t enough. The system needs long-term reform that lasts beyond one Parliament.

That’s why we are calling for a Royal Commission to build a cross-party consensus on a fairer, more stable student finance system,  including looking at fairer interest rates and how to stop constant political interference.

A fairer deal for graduates

The current system has drifted away from its original design and become more punitive over time.

Our plan would cut repayments, protect graduates from political meddling, reward public service and restore maintenance grants for those from disadvantaged backgrounds.

We cannot undo the past. But we can learn from it, and act now to make things better.

This is a bold yet deliverable plan to ease the cost-of-living pressure on graduates today, while building a fairer system for tomorrow.